WRAP AROUND STUDY GUIDE A Framework for, and Class of 2017 -2018/Session... · 1 WRAP AROUND STUDY

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    WRAP AROUND STUDY GUIDE

    A Framework for, and Concepts and Instruments of

    International Insolvency

    2017/18

    HOW TO USE THE WRAP AROUND STUDY GUIDE

    The purpose of the Wrap Around Study Guide study guide is to provide the candidates with some

    basic framework regarding the scope of the work to be covered during the session. The guide

    therefore includes a summary of the required prescribed materials that you should read against

    the backdrop of the insolvency law framework. (It also contains some cross referencing to the Study

    Notes which serve as the basic preparatory notes for this part of the course.)

    Candidates are urged to read the required prescribed materials in advance, using the Study Notes as

    the point of departure, in order to prepare themselves for this session. (Please bring a copy of the

    Wrap Around Study Guide along to this session.)

    In this session we will try to establish what international insolvency law is all about, and to assess the

    general sources, terminology and the broad principles against the backdrop of general features or

    essentials of insolvency systems. The development of international insolvency law will thus be

    discussed from the point of view of the development of both cross-border insolvency rules as well as

    the setting of standards for the development of domestic insolvency law systems.

    In order to do so we will consider the essential features of insolvency law, the sources of international

    insolvency law and some problem areas to be considered when working with cross-border matters.

    It must be pointed out that the lecturer of this session does not present all the contents of this

    guide as his own since it is largely structured around a summary of the prescribed texts and a

    number of other selected sources in order to make these more accessible for the purposes of the

    session.

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    OUTCOMES:

    SECTION A: GENERAL BACKGROUND

    After completion of this section you must know the basics of the following aspects:

    The framework and essential features of insolvency law.

    Some comparative aspects.

    Classification of insolvency systems.

    Different classes of creditors.

    Core terminology.

    SECION B: THE SOURCES AND NATURE OF INTERNATIONAL INSOLVENCY

    After completion of this section you must know the basics of the following aspects:

    What international insolvency law is.

    The sources and nature of international insolvency law.

    Basic principles and approaches to cross-border insolvency cases.

    Various models and instruments available and in those in the process of being developed in the area of cross-border insolvency law.

    Problematic areas in cross-border insolvency law.

    SECTION C: THE HARMONIZATION OF NATIONAL INSOLVENCY LAW AND ITS USE

    IN INTERNATIONAL INSOLVENCY LAW

    After completion of this section you must know the basics of the following aspects:

    Principles to harmonise national insolvency laws.

    Difficult areas for harmonisation, like:

    Voidable dispositions;

    Labour contracts;

    Priorities;

    Securities, and

    Principles relating to the qualifications of estate representatives.

    SECTION D: PRINCIPLES RELATING TO THE QUALIFICATIONS OF ESTATE

    After completion of this section you must know the basics of the following aspects:

    Appointment and qualifications

    Regulation

    Remuneration

    A. REQUIRED READING

    Boraine, Andr., Wrap Around Study Guide with cross referencing to sources for reading as indicated.

    Boraine, A., Insol Fellowship Study Notes (compiled by A Boraine), read sections as indicated in Wrap Around Study Guide.

    Omar, Paul., The Landscape of International Insolvency Law [Updated version of Omar,

    Paul J., The Landscape of International Insolvency. Law, in: 11 International Insolvency

    Review 2002, 173ff.]

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    Wood, Philip R., Principles of International Insolvency (2007) pp. 1 -30 (General

    Introduction).

    [Note: Follow Wrap Around Study Guide and Class Notes below as a guide]

    B. ADDITIONAL READING

    Fletcher, Ian F., Theory and Principle in Cross-Border Insolvency, in: Ian F. Fletcher, Insolvency in Private International Law: National and International Approaches (2005) pp.

    3-17.

    Fletcher, Ian .F., The Law of Insolvency(2009, with 2014 Second Cumulative Supplement) Chapters 1 & 2. (Fletcher 2).

    Garrido, J.M., The Role of Personal Insolvency in Economic Development in the World Bank Legal Review (2014) Vol 5 pp 111 127.

    Hatzimihail, NE, The Many Lives and Faces of the Lex Mercatoria : History as Genealogy in International Business Law (2008) 71 Law and Contemporary Problems at 169.

    Levinthal, L., The early history of bankruptcy law 1919 University of Pennsylvania Law Review 223.

    Wessels, B., International Insolvency Law (2012)

    Wessels, Bob and Boon, Gert Jan., Sources of International Insolvency Law.[Chapter 1 "Introduction to International Instruments: Commentary" from: Wessels, B and Boon, GJ.,

    Cross-Border Insolvency Law. International Instruments and Commentary, 2nd ed Kluwer

    Law International, (2015), pp. 1 134.]

    Westbrook, J., Locating the eye of the financial storm (2007) Brook. J Intl L vol 32:3.

    Westbrook, J., Ian Fletcher and the Internationalist Principle 2015 (3) NIBLeJ at 30.

    C. SOURCE MATERIALS

    See Annexures A to E at the end of Study Notes.

    D. GENERIC MATERIAL OFTEN COVERING MORE THAN ONE SESSION

    Read: Sections of Insol Fellowship Study Notes as indicated in this Study Guide.

    Read: Omar, Paul., The Landscape of International Insolvency Law [Updated version of Omar, Paul J., The Landscape of International Insolvency. Law, in: 11 International

    Insolvency Review 2002, 173ff.]

    Read: Wood, Philip R., Principles of International Insolvency (2007) pp. 1 -30 (General Introduction)

    NOTE: FOR SECTIONS A TO D: FOLLOW STUDY NOTES AND READ COMPULSORY

    READING MATERIALS

    SECTION A: GENERAL BACKGROUND [Read: Study notes pp 9 - 24]

    After completion of this study unit you must know the basics of the following aspects:

    The framework and essential features of insolvency law.

    Core terminology.

    The history of insolvency law.

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    Comparative aspects.

    Classification of insolvency systems.

    Different classes of creditors.

    1 FRAMEWORK OF ESSENTIAL FEATURES OF AN

    INSOLVENCY SYSTEM

    [UNCITRAL Legislative Guide:

    Different approaches to effective and efficient insolvency law. Most

    suitable national or local context.]

    A. ESSENCE OF INSOLVENCY/ BANKRUPTCY

    Collective (versus individual) nature/ procedure

    Meaning: insolvency and bankruptcy

    Terminology: consider principles

    Liquidation of Assets v rescue

    History: - English law and civil law

    o Insolvency law families - Individuals & corporate

    B. POLICY CONSIDERATIONS etc

    Pro creditor

    Pro debtor

    Traditional English v continental approach AND

    Key Objectives etc

    Certainty in market place

    Transparent and predictable

    Maximization of assets

    Balance: rescue and liquidation

    Equitable treatment of creditors (and distribution)

    Rules for ranking and priorities

    Timely, efficient impartial resolution of insolvency

    Preservation of estate Insolvency law should:

    Deal with rescue(restructuring) and liq

    Recognise rights established outside insolvency (general law) - local and foreign?

    Rights of real security

    Harmonised, predictable rules for cross-border Considerations:

    Balancing: interests of creditors, debtor, society different

    approaches policy

    Fresh start liquidation v rescue culture

    Society constantly changing insolvency not static

    Dependent on well-developed commercial system and regulatory

    framework

    Courts and role players professionals

    C. SOURCES

    Insolvency legislation (single Act or various pieces of legislation)

    Examples:

    USA

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    Germany

    Australia

    South Africa

    England and Wales

    General law v Insolvency Law

    Legislation, Common law, precedent

    CONSUMER

    BANKRUPT

    -CY

    -INDIVI-

    DUALS

    D. COMMON CHARACTERISTICS

    (General features)

    Liquidation

    Debt restructuring [Liquidation or rescue: result provides more value to creditors]

    CORPORATE

    BANKRUPTCY

    E. GATEWAYS AND COMMENCEMENT

    (How to open an insolvency proceeding?)

    Court?

    Other?

    Who can apply? (locus standi)

    Who not?

    Debtor/ creditor

    Open access?

    When to apply and requirements

    Insolvency Balance sheet C