London: +44 (0)20 7236 2601
St Albans: +44 (0)1727 869141
Rickmansworth: +44 (0) 1923 771010
Milton Keynes: +44 (0)1908 605552

Uncertainty in the UNCITRAL Model Law and the European Insolvency Regulation?

Although he describes Judge Drain's decision in In re SPhinX Ltd as pragmatic and commercial, Chris Mallon of Weil, Gotshal & Manges uses the case in an article entitled:
Bankruptcy Blunder
to illustrate his view that the uncertainty inherent in the Model Law makes credit-risk assessment very difficult and encourages forum shopping (and he expresses similar concern about the European Insolvency Regulation). I think the benefits of legislation encouraging cooperation between insolvency regimes far outweigh the risks of forum shopping. Of course parties will seek to gain advantage from any perceived uncertainty and some courts may react less predictably than others, but the COMI concept and its interpretation is becoming familiar to most practitioners. Certainly in Europe the debate has moved beyond COMI to considering how to manage cooperation between main and secondary proceedings, particularly in relation to creditors' rights to claim in either or both, or whether secondary proceedings are better avoided altogether by recognition of creditors' local rights in main proceedings.

 

 

Date: 29th December, 2006
Author: Chris Laughton

SHARE THIS

Articles from this Author

Contact a Partner

Tweet

We have had lots of festive fun across the 4 offices today fundraising for @savechildrenuk #ChristmasJumperDay we a… twitter.com/i/web/status/9…

Chartered accountants @mercerhole has helped an organisation to preserve more than 190 jobs chambermk.co.uk/news/mercer-ho…

Follow

LinkedIn

For the latest Mercer & Hole news, visit our LinkedIn page mercer-&-hole

Click here to follow us on LinkedIn