Learn about Chapter 15 Bankruptcy Purpose
It has been said that math is a universal language. Words and alphabets may be different from country to country, but numbers are a constant no matter where on Earth you go. With regards to bankruptcy laws, these too are subject to change just between American states, never mind between independent nations. However, debt is measured in numerical figures, and provided the right exchange rates are calculated, this should translate no matter what.
The role of a uniform bankruptcy law – or at least one modeled on a uniform law – then must be to reconcile the inconsistencies in bankruptcy laws across jurisdictions with the literal data that is the sum of debts to creditors. In terms of American bankruptcy laws, Chapter 15 bankruptcy is this negotiator. The following are considerations of the purposes of Chapter 15 bankruptcy:
As the most critical parties in these matters are those that are directly impacted by bankruptcy laws, namely the debtors and creditors, this idea of community is all for naught if agreements are made that do not represent those groups' best interests. Another clear objective of Chapter 15 is that, in liquidation cases bankruptcy filers will get the maximum possible value for their assets. In reorganization cases, the objective is that they are able to salvage their businesses. Regarding lenders, though, they too should be given certain safeguards, especially their representation in court.
As the United Nations Commission on International Trade Law (UNCITRAL) is a law that deals more broadly with "international trade," it makes sense that Chapter 15 law is not only concerned so narrowly with bankruptcy laws. Overall, this chapter strives to uphold "greater legal certainty for trade and investment" across borders.
NEXT: Learn All About Cross Border Insolvency