Vol 7 (2010) - Issue 4

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Look Chan Ho (ed.), Cross-Border Insolvency: A Commentary on the UNCITRAL Model Law

This is the only specialist work entirely devoted to the United Nations Commission on International Trade (UNCITRAL) Model Law on Cross Border Insolvency. The Model Law is an entirely new concept now enacted directly into English law by its inclusion in almost all material respects in the Cross-Border Insolvency Regulations 2006. The Regulations came into force on 4 April 2006.

There has since that time been only a handful of English decisions on various aspects of the Regulation, in particular the consideration of the types of proceedings, essentially main proceedings which justify recognition in this country. The same is hardly unusual with an enactment of this sort. The same slow but steady growth occurred with the EC Insolvency Regulation introduced into English law in 2000. Even now the English jurisprudence on the EC Regulation is not immense. It does, however, benefit from the substantial growth in reported case law and commentary on mainland Europe although the failure properly to record such decisions in a formal, systematic and easily accessible form is not helpful. It is to be hoped that the same problems do not apply over time with regard to the Model Law.

This is the 2nd edition of this work and is very welcome. The main editor remains the same individual who is increasingly familiar as a respected commentator on insolvency and banking subjects particularly in periodical literature. He is well known for causing there to be the occasional reassessment of well known themes such as the pari passu rule and subordination principles. He is a solicitor at one of the best practices dealing with insolvency and restructuring. This may well explain the presence of such an excellent group of contributors who comment on other jurisdictions in which the Model Law has been enacted. The work is the latest in a small but developing collection of specialist imprints by the same publisher each related to various forms of restructuring and financing.

The editor sensibly begins with an overview. It is often forgotten and overlooked that no reciprocity lies at the heart of the Model Law although a few jurisdictions have imposed that requirement in a de facto manner. Many concepts are, of course, familiar as they reflect similar concepts in the EC Insolvency Regulation. One issue, however, yet to be explored, certainly in the English jurisprudence, is the balance to be struck between competing claims, eg between a secured claimant in the recognising State and the effect of the home State insolvency process. This and similar problems remain great challenges ahead. In addition the vast and equally unexplored range of cross-border communication and co-operation mechanisms and concepts need to be worked out. As an overall principle, cross-border communication between judges at least, has not been embraced with total fervour by United Kingdom courts and much will have to be addressed on this score in the years to come.

As this review is being written, the Insolvency Service in the United Kingdom has launched an initial inquiry amongst practitioners as to the way in which the Model Law has been received, implemented and considered. This is no doubt because it presents so many features which are still relatively new and novel in the eyes of UK practitioners and lawyers.

Matters may not be vastly helped by the relatively small number of jurisdictions which have adopted the Model Law but there are some very important members in that club. They include particularly Australia, New Zealand, Canada, South Africa and most importantly the United States. The fact that these jurisdictions have adopted the Model Law reflects itself in the degree of detail which each contribution relating to those countries enjoys in this work.

The real value of the book is in its cross-references. Many of the contributors provide copious footnotes, not simply as to the origin and genesis of the way in which the Model Law has been enacted and adopted in particular jurisdictions but also with regard to domestic law and jurisprudence. There is no doubt that there will have to be much comparative analysis by each new jurisdiction as and when it joins the club. In October 2008, for example, the New South Wales Supreme Court issued a practice note to the effect that parties should consider guide lines applicable to court to court communication in cross-border cases. The format of those guidelines was drawn from the American Law Institute more or less designed in conjunction with the International Insolvency Institute. The same phenomenon has occurred in Canada.