- In 2005, Congress enacted Chapter 15 of the Bankruptcy Code to facilitate global cooperation among courts in multinational restructurings and to streamline the procedures to obtain orders from U.S. Bankruptcy Courts to aid foreign insolvency proceedings by, for example, enjoining U.S. litigation against foreign Debtors. As this new set of laws is less than two years old and most Chapter 15 cases have been conducted without serious objections. Case law interpreting Chapter 15 is only in its formative stages. While there remains well developed case law under the former section 304 of the Bankruptcy Code, it is an open question as to that case law’s continued applicability, but respected commentators have opined that section 304 case law will remain a source of guidance under the new system.
- Set forth below in section II is a discussion of Chapter 15, the procedures involved in obtaining relief, the type of relief available, major recent cases interpreting its provision and a discussion of major issues yet to be decided by U.S. courts.
- In section III below, there is also a discussion of strategies available to U.S. creditors of foreign debtors that can assist in maximizing recoveries.
Ch. 26 U.S. Bankruptcy Court Assistance to Non-U.S. Proceedings
JEFFREY W. LEVITAN, ADAM BERKOWITZ