7th TW Insolvency Forum, Marrakech – Cross-Border Insolvency Law Perspectives
I’m in the city of Marrakech this week for the 7th TW Insolvency Forum. As usual it is good to meet with colleagues and friends we work with in relation to Cross-Border matters, and give a Scots Law perspective on International Insolvency Law matters.
The city is fascinating, being a combination of European and African. Some of the architecture here is distinctly French while the sights and sounds of the Old Medina are those of Berber and Arab history.
COP22 the Climate Change Conference follows us over the weekend. In the meantime, we have also been discussing international policy; but rather how it will affect domestic and cross-border corporate insolvency.
Of course there has been discussion and speculation about the the effect of brexit. However, give the terms (and fact) of a United Kingdom exit from EU membership are not known, it is hard to measure the effect on domestic insolvency law of Brexit. There is of course further uncertainty because of the Article 50 Litigation, which is reported to be leapfrogging the English Court of Appeal to be heard in the U.K. Supreme Court next month.
I was, however, struck by the insolvency implications of CETA (the EU trade agreement with Canada). In terms of that agreement, it will be open, for example, to a Canadian investor to bring a claim against a member state if they suffer (again by way of example only) discrimination at the hands of a public authority. There is an argument that if local laws in a member state (for example, in Belgium) compel a court to approve a restructure where the highest offer for a distressed undertaking is rejected in favour of one that offers to preserve more jobs, a Canadian creditor may have a claim against the member state for financial loss. Such a claim, however, would be under the treaty and to the special tribunal instituted by the treaty. There is, it seems, a lack of literature dealing with the insolvency implications (although there is growing amount of literature on the issues caused by (arbitration) approach of the tribunals set up under the treaty) of the treaty. It will be interesting to see if claims follow or if the treaty is prayed in aid of arguments when the court has discretionary power as to what to approve in a restructure.
As usual with international law, the answer may not be black or white, or be found easily!