A New Approach to Transnational Insolvencies

Posted: 8 Apr 1997

See all articles by Robert K. Rasmussen

Robert K. Rasmussen

University of Southern California Gould School of Law

Date Written: January 1997

Abstract

This paper looks at the problems caused by the insolvencies of a multinational firm. It suggests that the current academic consensus that a single proceeding is optimal for all such insolvencies may not withstand scrutiny. It proposes that, as a first order solution, multinational firms should be allowed to select their own insolvency rules from a menu of options. A second best solution would be to allow multinational corporations to select, via a forum selection clause in the corporate charter, which country's or countries' bankruptcy regime will apply in the case of financial distress.

JEL Classification: G33, G34, G38, K22

Suggested Citation

Rasmussen, Robert K., A New Approach to Transnational Insolvencies (January 1997). Available at SSRN: https://ssrn.com/abstract=10380

Robert K. Rasmussen (Contact Author)

University of Southern California Gould School of Law ( email )

699 Exposition Boulevard
Los Angeles, CA 90089-0071
United States
213-740-6473 (Phone)
213-740-5502 (Fax)

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