Law.com Subscribers SAVE 30%

Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.

The Bankruptcy StrategistFeaturesBankruptcyInternational Law

Challenges Faced By U.S. Debtors Aiming to Qualify for Chapter 15 Recognition

By Richard J. Bernard and Roya Imani
October 01, 2023

Although Chapter 11 under the Bankruptcy Code represents a powerful corporate restructuring tool, many complain about the cost of Chapter 11. Other countries have restructuring and liquidation regimes that may represent more efficient tools to restructure or liquidate non-U.S.-based companies with U.S. subsidiaries and operations. Joint non-U.S. and U.S. proceedings may be the only realistic solution for mega cases like Nortel (Canada, United States and United Kingdom), Lehman Brothers (United States and United Kingdom) and Enron (United States and Canada).

There are, however, significant costs and complexities of running parallel proceedings with multiple courts around the world applying different laws and reaching conflicting rulings. When restructuring or liquidating a non-U.S.-based company with U.S. operations, practitioners should consider the benefit and efficiency of utilizing the company's home country laws under a foreign proceeding and a Chapter 15 in the United States.

|

Overview

Given the global economy, it is common for foreign companies to have U.S. subsidiaries with their own creditors and assets within the United States. Faced with this cross-border presence, foreign-based companies must decide how to safeguard their assets in the United States, manage U.S. creditors, and most efficiently restructure or liquidate the company. Imposing one nation's laws onto another requires some level of consent or waiver of sovereignty by the other nation.

This premium content is locked for Entertainment Law & Finance subscribers only

  • Stay current on the latest information, rulings, regulations, and trends
  • Includes practical, must-have information on copyrights, royalties, AI, and more
  • Tap into expert guidance from top entertainment lawyers and experts

For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473

Read These Next
How Secure Is the AI System Your Law Firm Is Using? Image

In a profession where confidentiality is paramount, failing to address AI security concerns could have disastrous consequences. It is vital that law firms and those in related industries ask the right questions about AI security to protect their clients and their reputation.

COVID-19 and Lease Negotiations: Early Termination Provisions Image

During the COVID-19 pandemic, some tenants were able to negotiate termination agreements with their landlords. But even though a landlord may agree to terminate a lease to regain control of a defaulting tenant's space without costly and lengthy litigation, typically a defaulting tenant that otherwise has no contractual right to terminate its lease will be in a much weaker bargaining position with respect to the conditions for termination.

Pleading Importation: ITC Decisions Highlight Need for Adequate Evidentiary Support Image

The International Trade Commission is empowered to block the importation into the United States of products that infringe U.S. intellectual property rights, In the past, the ITC generally instituted investigations without questioning the importation allegations in the complaint, however in several recent cases, the ITC declined to institute an investigation as to certain proposed respondents due to inadequate pleading of importation.

The Power of Your Inner Circle: Turning Friends and Social Contacts Into Business Allies Image

Practical strategies to explore doing business with friends and social contacts in a way that respects relationships and maximizes opportunities.

Authentic Communications Today Increase Success for Value-Driven Clients Image

As the relationship between in-house and outside counsel continues to evolve, lawyers must continue to foster a client-first mindset, offer business-focused solutions, and embrace technology that helps deliver work faster and more efficiently.