UNCITRAL United Nations Commission on International Trade Law Insolvency Law Jenny Clift Senior...

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UNCITRAL United Nations Commission on International Trade Law Insolvency Law Jenny Clift Senior Legal Officer

Transcript of UNCITRAL United Nations Commission on International Trade Law Insolvency Law Jenny Clift Senior...

Page 1: UNCITRAL United Nations Commission on International Trade Law Insolvency Law Jenny Clift Senior Legal Officer.

UNCITRAL United Nations Commission on International Trade Law

Insolvency Law

Jenny CliftSenior Legal Officer

Page 2: UNCITRAL United Nations Commission on International Trade Law Insolvency Law Jenny Clift Senior Legal Officer.

UNCITRAL United Nations Commission on International Trade Law

Membership & structure• 60 State members elected for 6 year terms,

representing 5 regional groupings

Africa (14): currently Algeria, Benin, Botswana, Cameroon, Egypt, Gabon, Kenya, Mauritius, Morocco, Namibia, Nigeria, Senegal, South Africa, Uganda

Asia Pacific (14), Latin America-Caribbean (10), Eastern Europe (8), WEOG (14)

• Structure – Commission: Members, observer States and invited non- and

inter-governmental organizations

– Working groups: currently 6, including insolvency; membership is the same as the Commission, but delegations more focused around subject-matter expertise; hold one week sessions twice per year

– Secretariat: located in Vienna, Austria

Page 3: UNCITRAL United Nations Commission on International Trade Law Insolvency Law Jenny Clift Senior Legal Officer.

UNCITRAL United Nations Commission on International Trade Law

Legislative GuideFinancial crises of 1990s led to recognition of role of insolvency law in preserving viable businesses and employment; promoting availability of finance; facilitating effective redistribution and recycling of assets; assisting recovery from economic and financial crisis

Assessment of insolvency regimes pointed to the need for modernization and adoption of best practice

Negotiation involved 87 States, 14 inter-governmental organizations and 13 non-governmental organizations

A key reference tool for law reform• Chile, Colombia, China, France, Georgia, Germany, India, Indonesia, Macedonia, Montenegro, Netherlands, ROK, Serbia, South Africa, Spain

• Part of the methodology for the FSB Reports on Observance of Standards and Codes (ROSC)

• Key resource in the World Bank Group Investment Climate Insolvency Technical Assistance Program

• Referenced in work by FSB, IMF, BCBS, EU on bank and financial institution resolution (especially part three)

Page 4: UNCITRAL United Nations Commission on International Trade Law Insolvency Law Jenny Clift Senior Legal Officer.

UNCITRAL United Nations Commission on International Trade Law

Legislative GuideIdentifies core issues to be addressed in an insolvency law & offers a range of solutions, with advantages and disadvantages discussed

Recommendations not intended to be directly enacted – outline issues and indicate how they might be addressed

Varying degrees of specificity of recommendations reflect degrees of consensus and/or relevance or importance of other policy and procedural considerations

Limited to debtors engaged in economic activity – consumers, specially regulated entities (e.g. banks) & enterprise groups not specifically addressed

Page 5: UNCITRAL United Nations Commission on International Trade Law Insolvency Law Jenny Clift Senior Legal Officer.

UNCITRAL United Nations Commission on International Trade Law

Model Law on Cross-Border Insolvency

Negotiation involved 72 States, 7 inter-governmental organizations and 10 non-governmental organizations

Provides a framework for cooperation and coordination of insolvency proceedings across borders

Legislation enacted by:

Australia (2008), British Virgin Islands* (2005), Canada (2009), Colombia (2006), Eritrea (1998), Great Britain (2006), Greece (2010), Japan (2000), Mauritius (2009), Mexico (2000), Montenegro (2002), New Zealand (2006), Poland (2003), Republic of Korea (2006), Romania (2003), Slovenia (2008), Serbia (2004), South Africa* (2000) and United States of America (2005)

Page 6: UNCITRAL United Nations Commission on International Trade Law Insolvency Law Jenny Clift Senior Legal Officer.

UNCITRAL United Nations Commission on International Trade Law

Model Law on Cross-Border Insolvency

Reasons to adopt• Establishes simple straightforward requirements for recognition of foreign proceedings• Focuses on quick and predictable outcomes • Reduces scope for disputes• Recognizes need for speed - provision for interim relief• Similarity of laws (e.g. OHADA, EU) facilitates proof of law, especially in cross-border cases• International jurisprudence provides resource for interpretation and application• Establishes framework for cooperation and coordination• Multinational Judicial Colloquium fosters cooperation• The Judicial Perspective provides information for judges on issues associated with applications under the ML

Page 7: UNCITRAL United Nations Commission on International Trade Law Insolvency Law Jenny Clift Senior Legal Officer.

UNCITRAL United Nations Commission on International Trade Law

Model Law on Cross-Border Insolvency

Concerns and apprehensions• Imports insolvency law of the foreign country • Protection of local creditors and participation of local creditors in foreign proceedings not ensured • Foreign insolvency practitioners will be allowed to administer local proceedings • Recognition of foreign court decisions and orders on insolvency detracts from sovereignty and independence • Cannot be adopted without reciprocity • Practical issues make implementation difficult – mechanics of how to cooperate, judicial experience