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Blog 2007

2007-11-doc1 Bear Stearns: Recognition of Foreign Insolvency Proceedings in the US

A conference, with this title, is organised by The British Institute of International and Comparative Law, in London, on Monday 26 November 2007 (17:30 to 19:30). It is chaired by the Hon Mr Justice Lightman. Speakers include: Gabriel Moss QC, Stephen Gale, Ron Dekoven and myself. Location: The British Institute of International and Comparative Law, Charles Clore House, 17 Russell Square, London, WC1B 5JP. From the conference brochure: What is this seminar about? In August, the US Bankruptcy Court declined to recognise the Cayman Islands proceedings of two Bear Stearns' Hedge Funds under Chapter 15 of the US Bankruptcy Code. Judge Lifland of the Bankruptcy Court found that, although formally registered in the Cayman Islands, there was neither a "centre of main interest" (COMI) nor an "establishment" in Cayman and therefore recognition under Chapter 15 was not possible. In reaching his decision, Judge Lifland looked at the UNCITRAL Model Law, its Guide to Enactment, the European Insolvency Regulation and the European Court of Justice's Eurofood decision of 2 May 2006. During the seminar Bob Wessels, Gabriel Moss, Stephen Gale and Ron Dekoven will discuss this decision and the earlier SPhinX case in particular and will focus more generally on the desicion topic of recognition of foreign insolvency proceedings in the US. Background Bear Stearns Asset Management operated two funds -- the High-Grade Structured Credit Strategies Fund and the High-Grade Structured Credit Strategies Enhanced Leverage Fund (once controlling about $10 billion in assets) -- that had invested heavily in collateralized debt obligations (CDOs) backed by subprime mortgages. As a result of the recent turmoil in sub-prime lending and in the financial markets, the two Cayman-registered Bear Stearns funds filed winding-up petitions in the Cayman islands and joint provisional liquidators appointed in Cayman applied for recognition under Chapter 15 of the US Bankruptcy Code. The liquidators of Bear Stearns's two Cayman-based bankrupt hedge funds have appealed the ruling in the United States Bankruptcy Court, which denied their request to liquidate in the Cayman Islands rather than in the US. See

2007-11-doc2 Voorontwerp Insolventiewet verschenen

[Pre-draft Insolvency Act published] Vandaag, 1 november 2007, is door de voorzitter van de Commissie insolventierecht, Prof. mr. S. C. J. J. Kortmann, aan minister Hirsch Ballin van Justitie het Voorontwerp Insolventiewet aangeboden. De minister heeft besloten om via een internetconsultatie reacties op het voorontwerp in te winnen. Ik verwacht dat de Commissie, waar ik lid van ben, in de gelegenheid wordt gesteld de reacties te verwerken in een definitieve tekst. De duur van de consultatieronde is mij nu nog niet bekend. De belangrijkste elementen worden kort in een persbericht weergeven. Daarin staat echter niet de doorbraak die het voorontwerp kent ten aanzien het bestaande stelsel van internationaal insolventierecht. Het voorontwerp geeft in Titel 10 een 30-tal bepalingen voor grensoverschrijdende insolventies. Voor grensoverschrijdende insolventies binnen de Europese Unie geeft de Europese Insolventieverordening natuurlijk voorzieningen. In aanvulling hierop bevat het voorontwerp voorzieningen die betrekking hebben op grensoverschrijdende insolventies waarbij ook landen buiten de Europese Unie zijn betrokken. Insiders herkennen de UNCITRAL Model law on Cross-Border Insolvency, althans naar haar inhoud, niet naar haar vorm. voorontwerp- insolventiewet -persbericht.pdf voorontwerp- insolventiewet- nov-2007.pdf

2007-10-doc6 INSOL Europe: Call for papers

Earliers documents of October on this weblog have mentioned some of the Academic Forum of INSOL Europe's activities. For the Annual meeting of next year (Barcelona,

2007-10-doc5 The Comity Principle

During the INSOL Europe meetings (see this weblog under 2007-10-doc2, doc3 and doc 4) a discussion took place with regard to the additional value the principle of comity would have now Chapter 15 is in force since Oktober 2005 in the US. Some Europeans were not familiar with the concept. See for some insight my article "The Comity Principle", which has been published in: "Amice", a Liber Amicorum presented to professor G.R. Rutgers in April 2005, on the occasion of his retirement from the University in Groningen (Kluwer, 2005, pp. 347-359). comity.pdf

2007-10-doc2 Co Co Guidelines adopted by INSOL Europe

I have been able to report several times about one of the larger projects I have been working on, together with a group of some twenty practitioners, academics and judges: the European Communication & Cooperation Guidelines for Cross-border Insolvency. See my last message under 2007-09-doc1. I am pleased to announce that these Guidelines now have been adopted by INSOL Europe, durings its Annual meeting of 10-14 October 2008. See the organisations' declaration attached.