Creditors in insolvency proceedings

Recommendations 115 (impact of insolvency on conflict of laws rules) and 116 (enforcement in insolvency proceedings)

(c) Request any relief available to it in insolvency proceedings.

(49) The insolvency law should specify that the measures applicable on commencement of insolvency proceedings remain effective throughout those proceedings until

1346 2000 on Insolvency Proceedings nor the UNCITRAL Model Law on Cross Border Insolvency addresses the issue.

(46) The insolvency law should specify that, on commencement of insolvency proceedings add a, b, c, d, e

(mm) Insolvency proceedings means collective judicial or administrative proceedings for the purposes of either reorganization or liquidation of the debtor's business conducted according to the insolvency law.

(ll) Insolvency estate means assets and rights of the debtor that are controlled or supervised by the insolvency representative and subject to the insolvency proceedings.

The Hague Conference collaborated closely with UNCITRAL in developing the chapter of the UNCITRAL Legislative Guide on Insolvency Law dealing with law applicable in insolvency proceedings.

(4) The insolvency law should specify that where a security interest is effective and enforceable under law other than the insolvency law, it will be recognized in insolvency proceedings as effective and enforceable.

Three issues of specific concern in insolvency proceedings involving one of a group of companies are

The unavailability of provisional measures in such circumstances could frustrate the objectives of the insolvency proceedings.

Under some insolvency laws, intra group transactions may be subject to avoidance proceedings.

The insolvency law should specify that, if a security right is entitled to priority under law other than the insolvency law, that priority continues unimpaired in insolvency proceedings except if, pursuant to the insolvency law, another claim is given priority.

(c) Commencement of insolvency proceedings by a group company against a related group company.

(30) The law applicable to the validity and effectiveness of rights and claims existing at the time of the commencement of insolvency proceedings should be determined by the private international law rules of the State in which insolvency proceedings are commenced.

However, criminal proceedings associated with punishment of fraudulent activities often significantly impact the insolvency process.

(137) The insolvency law should specify that a party in interest have a right to be heard on any issue in the insolvency proceedings that affects its rights, obligations or interests.

On 31 May 2002, EU Regulation 1346 2000 on cross border insolvency proceedings came into force.

The stay does not apply to commencement of full insolvency proceedings in the United States, although those proceedings would be subject to the provisions on coordination and cooperation.

The insolvency law should provide that, in the case of the insolvency proceedings of the grantor, the acquisition financier has the rights and duties of a holder of a security right.

The insolvency law should provide that, in the case of the insolvency proceedings of the grantor, the acquisition financier has the rights and duties of a holder of a security right.

So, for example, the definition of assets of the debtor is included to explain the scope of the insolvency estate formed on commencement of the insolvency proceedings and thus the assets that will be affected by the commencement of those proceedings.

For example, it is not uncommon for insolvency proceedings to be partially or completely suspended pending criminal investigations.

220. A second sub area, broadly referred to as quot access and recognition quot , concerned the granting of access to the courts to representatives of foreign insolvency proceedings or creditors, and to giving recognition to orders issued by foreign courts administering insolvency proceedings.

J. The insolvency law should provide that, if a holder of a security right in an asset of the insolvency estate has subordinated its priority unilaterally or by agreement in favour of any existing or future competing claimant, such subordination is binding in insolvency proceedings with respect to the grantor.

For the purposes of this chapter, the term debtor as used in the recommendations taken from the Insolvency Guide should be read as referring to a person who meets the requirements for the commencement of insolvency proceedings (see Insolvency Guide, part two, chapter I, section A, paras.

(iv) The insolvency representative in the insolvency of the grantor or

Directors' and officers' responsibilities and liabilities in insolvency and pre insolvency cases

Some insolvency laws provide, for example, that where a lender advances funds to an insolvent debtor in that period, it may be responsible for any increase in the liabilities of other creditors or the advance will be subject to avoidance in any ensuing insolvency proceedings.

Insolvency

(e) In the area of insolvency, the UNCITRAL Model Law on Cross Border Insolvency and the UNCITRAL Legislative Guide on Insolvency Law

Developments in insolvency law adoption of the UNCITRAL Model Law on Cross Border Insolvency

In that connection, the Commission noted with particular satisfaction the efforts undertaken by Working Group V (Insolvency Law) and Working Group VI towards coordinating their work on a subject of common interest such as the treatment of security interests in the case of insolvency proceedings.

In any event, it may be necessary to determine the balance of responsibilities between the interim insolvency representative and the debtor with respect to the operation of the debtor's business, bearing in mind that no determination as to commencement of insolvency proceedings has been made.

Where business fails, it is important not only to know how those groups will be treated in insolvency proceedings, but also to ensure that that treatment facilitates, rather than hinders, the fast and efficient conduct of those proceedings.

In the absence of enabling or clarifying treatment in the insolvency law, the provision of finance in the period before commencement of the insolvency proceedings may also raise difficult questions relating to the application of avoidance powers and the liability of both the lender and the debtor.

Italy noted with satisfaction that the UNCITRAL Congress, whose proceedings it hoped to see published quickly, had suggested a number of very interesting topics, such as pre hearing conferences in arbitral proceedings, assignment of claims and cross border insolvency.

Insolvency law

Insolvency law

That's insolvency.

That's insolvency.

Effectiveness of security rights in insolvency

Note to the Working Group See recommendation 85 (see WP.21 Add.1), which sets forth the general rule on subordination applicable in the absence of insolvency proceedings.

The advantage of focusing on systems in the insolvency area is that the insolvency area ultimately applies to all activities whenever an insolvency or reorganization occurs.