As complex restructurings increasingly implicate cross-border considerations, other countries’ insolvency laws have become increasingly more relevant to practitioners in the U.S. This article will focus on creditors’ in various jurisdictions to provide a better understanding of how foreign creditors protect their rights in an insolvency proceeding.
Brazilian Federal Law No. 12.846/13 (the “Anti-Corruption Law”), which became effective on Jan. 29, 2014, establishes the civil and administrative liability of legal entities for acts that are harmful to the public administration, and applies to both domestic and foreign entities. The new law applies not only to Brazilian legal entities, but also to foreign legal entities with headquarters, branches or representatives in Brazil, and will reach acts performed in Brazil and even acts harmful to the foreign public administration perpetrated abroad.
A recent decision by the Second Circuit Court of Appeals in Drawbridge Special Opportunities Fund LP v. Barnet,[1] which found that the bankruptcy court should not have granted chapter 15 recognition to the foreign insolvency proceeding of an Australian company, adds to the growing body of recent case law evidencing that courts will evaluate the relief a foreign representative seeks under the established standards and requirements applicable to cases under other chapters of the Bankruptcy Code.
German corporate bankruptcy law will soon undergo a major reform when the proposed Gesetz zur weiteren Erleichterung der Sanierung von Unternehmen (ESUG, or the Company Restructuring Facilitation Act) passes through legislation. The objective of the ESUG is to facilitate the restructuring of companies, strengthen the role of creditors and advance debtor-in-possession (DIP) type orders (eigenverwaltung) and reorganization plans (insolvenzplan).
A new law recently published in Brazil will facilitate the making of new investments with limited liability. Federal Law No. 12,441, enacted on July 11, 2011 (Law 12,441), amended certain provisions of the Brazilian Civil Code (Federal Law No.
On April 19, 2011, the High Court of England and Wales heard an application for the sanction of a scheme of arrangement for Rodenstock GmbH, a solvent German company. Two days later, the court entered an order sanctioning the scheme, and indicating that Mr. Justice Briggs’ reasoning would be provided in a reserved judgment. The judgment that followed, entered on May 6, 2011, [1] is notable because it expresses a bullish or expansive view of U.K.
On June 14, 2010, the joint liquidators of Fairfield Sentry Ltd.—the largest Madoff “feeder fund”—filed a chapter 15 petition with the U.S. Bankruptcy Court for the Southern District of New York seeking recognition of the fund’s British Virgin Islands (BVI)-based insolvency proceedings.
One of the by-products of the Lehman insolvency is an increased focus on client money protection. The decision of Briggs J in the Lehman case concerning client moneys, reported as Lehman Brothers International (Europe) (in administration) v. CRC Credit Fund Limited & Ors, [2009] EWHC 3228, highlights a number of deficiencies in the current regime.
The Basel Committee on Banking Supervision may be most widely known as the originator of the “Basel Capital Standards,” “Basel II” and “Basel [III].” They provide guiding principles for capital for credit institutions (principally deposit-taking institutions) and related actors in the organized and regulated financial markets. The committee traces its origins largely to bank failures. The collapse of Bankhaus Herstatt and of Franklin National Bank and related entities in the 1970s provided important reasons for the formation of the committee.
At one time, insolvency proceedings were primarily confined to one jurisdiction. However, in the age of expanding globalization, corporate insolvencies may now involve businesses and assets in multiple jurisdictions.