New UNCITRAL Model Law On The Recognition And Enforcement Of Insolvency-Related Judgments

On September 18, 2018, the United Nations Commission on International Trade Law ("UNCITRAL") published its final version of the new Model Law on the Recognition and Enforcement of Insolvency-Related Judgments (the "IRJ Model Law"). The IRJ Model Law creates a framework for the recognition and enforcement of judgments in foreign bankruptcy and insolvency proceedings. It is intended to supplement and complement the 1997 UNCITRAL Model Law on Cross-Border Insolvency (the "CBI Model Law"). The CBI Model Law has been adopted by 44 nations or territories, including the U.S., in chapter 15 of the Bankruptcy Code (enacted in 2005), and the U.K., in the Cross-Border Insolvency Regulations (in force since 2007) (the "CBIR"). The CBI Model Law establishes a framework for cooperation and coordination among courts presiding over cross-border bankruptcy and insolvency proceedings.

The stated purpose of the IRJ Model Law is:

To create greater certainty in regard to rights and remedies for recognition and enforcement of insolvency-related judgments; To avoid the duplication of insolvency proceedings; To ensure timely and cost-effective recognition and enforcement of insolvency-related judgments; To promote comity and cooperation between jurisdictions regarding insolvency-related judgments; To protect and maximize the value of insolvency estates; and Where legislation based on the [CBI Model Law] has been enacted, to complement that legislation. Like the CBI Model Law, the IRJ Model Law promotes a universalist, rather than a territorial, approach to cross-border bankruptcy proceedings. In this context, "universalism" means that bankruptcy or insolvency proceedings should be recognized worldwide, obviating the need for disjointed proceedings in multiple foreign jurisdictions applying local law for the benefit of local creditors in an exercise of...