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Is Chapter 15 Universalist or Territorialist? Empirical Evidence from United States Bankruptcy Court Cases


Jeremy Leong


Wong Partnership; Singapore Management University - School of Law

August 11, 2010

Wisconsin International Law Journal, Forthcoming

Abstract:     
This article reports the findings of an empirical study of relief granted in all Chapter 15 cases filed since it was enacted in 2005. It argues that United States courts applying Chapter 15 have not unconditionally turned over debtor’s assets in the United States to foreign main proceedings. The results of the study show that while United States courts recognized foreign proceedings in almost every Chapter 15 case, courts entrusted United States assets to foreign proceedings for distribution in only 45.5% of cases where foreign proceedings were recognized. When such entrustment was granted, 31.8% of cases were accompanied by qualifying factors including, orders which protected United States creditors by allowing them to be paid according to the priority scheme under United States bankruptcy law; or assurances that certain United States creditors would be paid in full or in priority. In only 9.1% of cases, entrustment of assets for distribution was ordered without any qualifications; and where there were US creditors and assets at stake. From this data, this paper concludes that when deciding Chapter 15 cases, United States courts seldom grant Entrustment without Qualifications when United States creditors may be adversely affected. As a result, this article argues that Chapter 15 is not as universalist as its proponents claim it to be and exposes the inability of Chapter 15 to resolve conflicting priority rules between the United States and foreign proceedings.

Number of Pages in PDF File: 27

Keywords: Bankruptcy, Insolvency, International Bankruptcy, International Insolvency, Chapter 15, Bankruptcy Code, Empirical, Territorialism, Universalism

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Date posted: October 11, 2010  

Suggested Citation

Leong, Jeremy, Is Chapter 15 Universalist or Territorialist? Empirical Evidence from United States Bankruptcy Court Cases (August 11, 2010). Wisconsin International Law Journal, Forthcoming. Available at SSRN: http://ssrn.com/abstract=1690545

Contact Information

Jeremy Leong (Contact Author)
Wong Partnership ( email )
80 Raffles Place
#58-01 UOB Plaza 1
Singapore, 048624
Singapore
Singapore Management University - School of Law
60, Stamford Road
Level 4
Singapore, 178900
Singapore

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