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The characterization of pre-insolvency proceedings in private international law
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Mevorach, Irit and Walters, Adrian (2020) The characterization of pre-insolvency proceedings in private international law. European Business Organization Law Review, 21 (4). pp. 855-894. doi:10.1007/s40804-020-00176-x ISSN 1566-7529.
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Official URL: http://dx.doi.org/10.1007/s40804-020-00176-x
Abstract
The decade since the financial crisis has witnessed a proliferation of various ‘light touch’ financial restructuring techniques in the form of so-called pre-insolvency proceedings. These proceedings inhabit a space on the spectrum of insolvency and restructuring law, somewhere between a pure contractual workout, the domain of contract law, and a formal insolvency or rehabilitation proceeding, the domain of insolvency law. While, to date, international insolvency instruments have tended to define insolvency proceedings quite expansively, discussion of the cross-border implications of pre-insolvency proceedings has barely begun. The question is whether pre-insolvency proceedings should qualify as proceedings related to insolvency for the purpose of private international law characterization. The risk is over-inclusivity of cross-border insolvency law, which, where it is based on universality and unity, might defeat contractual expectations. This article argues, however, that we should be slow to exclude pre-insolvency proceedings from cross-border insolvency law: these proceedings are initiated in the zone of insolvency, their effectiveness depends on a statutory mandate and not purely on private ordering, they interact and intersect with formal proceedings, and can benefit from the unique system developed by cross-border insolvency law. We suggest, though, that modified universalism (the leading norm of cross-border insolvency) and international insolvency instruments, should, and are able to, adjust to the peculiarities of pre-insolvency proceedings to address concerns about inclusivity and accommodate pre-insolvency proceedings adequately.
Item Type: | Journal Article | ||||||||
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Divisions: | Faculty of Social Sciences > School of Law | ||||||||
Journal or Publication Title: | European Business Organization Law Review | ||||||||
Publisher: | Springer | ||||||||
ISSN: | 1566-7529 | ||||||||
Official Date: | December 2020 | ||||||||
Dates: |
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Volume: | 21 | ||||||||
Number: | 4 | ||||||||
Page Range: | pp. 855-894 | ||||||||
DOI: | 10.1007/s40804-020-00176-x | ||||||||
Status: | Peer Reviewed | ||||||||
Publication Status: | Published | ||||||||
Access rights to Published version: | Open Access (Creative Commons) | ||||||||
Date of first compliant deposit: | 6 September 2023 | ||||||||
Date of first compliant Open Access: | 6 September 2023 |
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