Have you heard about Chapter 15 of the Bankruptcy Code? Most likely you do not have, most bankruptcy attorneys do not raise this kind of incident. Many people did not know Chapter 9 of the Bankruptcy Code until the recent luxury bankruptcy case of various local governments through the United States. Chapter 15 was created in 2005 when bankruptcy law was revised. So why did you need to create another chapter? There are already two chapters to reconstitute the debt as you can already liquidate the asset. Family farmers and fishermen have their own special chapter with local governments.
So what is Chapter 15? Rules concerning bankruptcy proceedings of companies conducting business in multiple countries already exist. The United Nations Commission on International Trade Law manages bankruptcy internationally. Prior to the creation of Chapter 15, there was Article 304 of the Bankruptcy Act, which involved debtors, asset claims, and stakeholders including countries other than the United States. The idea is to help cooperate with the US courts and foreign courts. If you are operating overseas you already know that there are uncertainties when dealing with other countries and their laws. When things go bad it will be more certain now when dealing with bankruptcy situations across the border. As with the other chapters in the Bankruptcy Code chapter, it is equitable to treat all involved parties, maximize assets and gain the benefit of those who are money.
Another goal is to help companies with these problems rescue their jobs well and protect existing investments. Normally the case in chapter 15 is part of other procedures in another foreign jurisdiction. It does not mean that reorganization of Chapter 7 or Chapter 11 is not done either. It is possible that there are liabilities for a large number of parties with assets in the United States and for parties who need to manage under other chapters of bankruptcy law.
If Chapter 15 is initiated by a foreign representative, the foreign company will be able to acquire automatic stay and continue driving. Another goal is to provide protection against discrimination against foreign creditors and creditors. This is a very complex area of bankruptcy law, in this article it only hurts the surface of the possible things and its way. If you think there are foreign debt issues to be resolved, please consult an experienced bankruptcy attorney in your jurisdiction. The chapter of bankruptcy law will be used more frequently as business outside the United States continues to be done in the United States. I hope that more cooperation will be brought to foreign courts for the benefit of employees and those paying money.
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