Vol 7 (2010) - Issue 2

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The UNCITRAL Model Law on Cross-Border Insolvency: Interaction with the English Courts

Introduction

The management of cross-border insolvency instances has a long pedigree in the United Kingdom, especially within the jurisdiction of the courts of England and Wales, which, as early as the 18th century, began offering the courts of other countries assistance in the administration of cases involving debtors trading or with assets in both jurisdictions. Progressively, the means of assistance have acquired legislative support, firstly through mutual aid provisions, first seen in the Bankruptcy Act 1861, and later the 'aid and auxiliary' doctrine set out in section 74 of the Bankruptcy Act 1869 and its legislative successors: section 122 of the Bankruptcy Act 1914 and section 426 of the Insolvency Act 1986, the latter also extending the provision to corporate insolvencies. Alongside this, as a parallel to the bankruptcy provisions, ancillary winding up, as now seen in section 221 of the Insolvency Act 1986, became the preferred co-operation mechanism for corporate debtors potentially subject to procedures in more than one jurisdiction. Membership of international organisations taking an interest in insolvency matters has resulted in the application of the European Regulation on Insolvency Proceedings 2000, while the initiative launched by UNCITRAL, which brought about the adoption of the UNCITRAL Model Law on Cross-Border Insolvency 1997, has also recently been given legislative effect in 2006. The Model Law is an innovative document that places co-operation and assistance at the heart of the text, particularly in Chapter IV (Articles 25-27), whose provisions are based on the ideal of co-operation between insolvency courts and representatives.