Vol 20 (2023) - Issue 6

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Navigating the Rule in Gibbs in Cross-Border Restructurings: Alternatives to a Solely English Process

Synopsis
The rule in Gibbs may be infamous but it is not insurmountable. While debate rages on (both in England and Wales, and the other common law jurisdictions in which the rule still holds sway) as to whether it should be discarded, debtors are left navigating the longstanding rule. Through two-step legal processes, recognition proceedings, parallel proceedings and an increased confidence in relying on the purported extraterritorial effects of foreign processes, debtors continue to successfully restructure English law-governed obligations even where the rule in Gibbs complicates matters. The purpose of this article is to discuss and evaluate the increasingly innovative tools and tactics that debtors are using to navigate, and mitigate the impacts of, the rule in Gibbs.