At the Edge of the Universe: Are Chapter 15’s Principles of ‘Universalism’ Too Parochial for the Realities of Today’s Global Economy?

At the Edge of the Universe: Are Chapter 15’s Principles of ‘Universalism’ Too Parochial for the Realities of Today’s Global Economy?

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WilmerHale Partners George W. Shuster Jr. and Benjamin Loveland published an article that examines the increasing complexity in applying the concept of “universalism” embodied in Chapter 15 of the Bankruptcy Code to global insolvency cases spanning across national borders. 

Their article, titled “At the Edge of the Universe: Are Chapter 15’s Principles of ‘Universalism’ Too Parochial for the Realities of Today’s Global Economy?,” was published in the August issue of the ABI Journal.

As Messrs. Shuster and Loveland explain, universalism is the concept “that a ‘main’ court in the debtor’s ‘home’ jurisdiction would administer the debtor’s insolvency proceeding, while ‘ancillary’ courts in other jurisdictions where the debtor has assets or liabilities would assist by recognizing the main court’s orders and otherwise cooperating in aid of the main proceeding.”  

The lawyers focus on two recent bankruptcy court decisions, In re Serviços de Petróleo Constellation SA and In re Agrokor d.d. They write that the two cases “illustrate the practical difficulties inherent in pursuing pure universalism, even in a country like the US, which, through the enactment of Chapter 15 has sought to foster universalism’s principles.” 

 

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