Cross-Border Insolvency: A Primer on Chapter 15 of the U.S. Bankruptcy Code
By Gabe Matus
The current global economic crisis has spawned a recent wave of complex insolvency proceedings in jurisdictions spanning the globe. Add to the mix the increasingly global nature of business and economics and the result is that a debtor subject to an insolvency proceeding in one jurisdiction may likely have assets and operations in a number of other sovereign jurisdictions. Managing the interrelation between concurrent multi-jurisdictional proceedings involving the same debtor or affiliated debtors has been a challenge for court systems, debtors and creditors alike since the emergence of the global economy. As economists warn of continuing risks and concerns with regard to the global economic outlook,[1] the regime established under Chapter 15 of the United States Bankruptcy Code (Ancillary and Other Cross-Border Cases)[2] becomes increasingly relevant for creditors and debtors – both abroad and within the U.S. This article provides a brief overview of Chapter 15 and some of the issues relevant to parties-in-interest in cross-border insolvency proceedings.