Graintfjall wrote:“Two questions. First, I’m confused by the wording of Article 9.
a time limit on the number … what does that mean in practice? That they can set a time limit within which a certain number of claims can be enforced? It seems to mix…”
Júlía Maria fumbles for the proper wording, “…properties? To conflate both ‘time’ and ‘number’. But it may not matter if the meaning is clear and simply escaping this doddery old economist.
"My intent is to allow nations to bar repeat bankruptcy claims by a party within too short a time. In the C.D.S.P., for example, there is a moratorium of 7 year period in which an individual may not file for bankruptcy under the same chapter. I don't mean to drone on about C.D.S.P. legalisms, but there are five different kinds of bankruptcy, and it is theoretically possible to file under a different chapter and follow different rules, but this is not always the case elsewhere. Suffice to say, it is to allow nations to take measures preventing repeated bankruptcy claims to the detriment of bona fide creditors."
“Second. After setting out the definitions, the resolution proceeds to discuss a foreign bankruptcy proceeding. Here’s my concern, admittedly more hypothetical at this stage. What if a foreign bankruptcy lacks procedural fairness (setting aside, for the moment, the question of how that could given all the various legal fairness resolutions the General Assembly has passed)? We don’t have a harmonized bankruptcy code and it is conceivable that another country’s bankruptcy laws are not procedurally fair. Is this a valid concern, or is it something that, in concert with those other resolutions on legal fairness, is unlikely to arise?
"That is eminently reasonable as a concern, and one that I considered. I decided that, regardless of the subjective fairness of a procedure (after all, a communist country may consider no creditor protection fair), where the substantial part of a collection of assets remains in one nation, it is eminently more efficient to enforce that nation's law over a smaller part of assets that are, by mere happenstance, in another nation. As such, creditors needn't worry about a debtor using foreign jurisdictions to conceal assets and frustrate the lending process, which disincentivizes otherwise manageable risk. It also allows debtors to initiate only one complicated proceeding, allowing them to avail themselves of bankruptcy protections more readily.
"That unjust laws may be applied beyond their jurisdiction is a risk, but I consider that the harm of those laws being enforced is outweighed by the greater risk of nations either refusing comity, thus requiring multi-jurisdictional proceedings as a hindrance to both debtors and creditors, or selectively enforcing foreign laws in a way that makes the process entirely uncertain for all parties involved."
“We’re really reaching for something to oppose for no reason than to dust the cobwebs off, and as written this would likely have our support – subject to the back-office gremlins giving it a fine-tooth going over.”
"Given the lack of genuine substantive debate on this, ambassador, I do not begrudge you the review at all."
Posted: Wed Apr 22, 2020 6:40 pm
