Beyond Fragmentation: Building Effective Cross-Border Insolvency Coordination

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Gargi Verma & Aaradhya Sharma, Army Institute of Law, Mohali

ABSTRACT

Cross border insolvency regimes are fraught with jurisdictional Obstacles as the law pertaining to different countries is in conflict in the interest of creditors, the distribution of assets, and the enforcement of such laws. Although international harmonisation attempts such as the UNCITRAL Model Law and the EU Insolvency Regulation have provided a framework for international cooperation in the procedure of insolvency, the differences between the countries persist. The high-profile cases of Lehman Brothers, FTX, and Jet Airways have highlighted the lacuna in the regulation of multinational corporate groups.

Whilst India’s system of insolvency is sound domestically due to the Insolvency and Bankruptcy Code, it suffers from similar issues of insufficient global harmonization tools with other jurisdictions. The latest reforms suggest that new coordination tools will be developed that, if successfully implemented, have the potential to make India a leader in relation to Asian cross-border insolvency resolution issues. The changing framework of global trade and the rise of digital assets require an advanced harmonization system and sophisticated tools of judicial cooperation to handle the increasing complexity of international corporate collapses.

Keywords: Cross-border Insolvency, UNCITRAL Model Law, Global Trade, Insolvency and Bankruptcy Code, International Coordination.

121. BEYOND FRAGMENTATION- BUILDING EFFECTIVE CROSS-BORDER INSOLVENCY COORDINATION.pdf

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