INSOL Principles meaning

Basic principles Owing to the versatility of schemes of arrangement (schemes) (see Practice Note: Benefits of schemes compared to other processes), together with their ability to bind every creditor within the affected classes of a scheme compromise, and the shortcomings perceived in certain domestic restructuring tools in some overseas jurisdictions, schemes are frequently deployed to restructure foreign companies or English companies with substantial assets or creditor bases outside the UK (see Practice Note: Establishing jurisdiction and sufficient connection). Yet, absent recognition, a scheme may have little practical effect, or the scheme company may remain vulnerable to being subject to an overseas insolvency procedure. Consequently, advisers should address recognition questions from the outset of the scheme process. For proceedings issued on or after 31 December 2020, the operative elements of the EU Recast Regulation on Insolvency dealing with automatic recognition, and the EU Brussels I recast, no longer apply to the UK (see: No deal Brexit—impact on jurisdiction agreements—checklist), with recognition now turning on private international law (see Practice Note:...

This Practice Note has been archived and is no longer maintained. Lexis+® UK are collaborating with INSOL Europe on a joint initiative to source articles from INSOL Europe’s national correspondents across EU Member States to compile a table distilling their findings, also drawing on Lexology Panoramic (see News Analysis: INSOL Europe/Lexology Panoramic launch Joint Project on ‘How EU Member States recognise insolvency and restructuring proceedings of a third country’). It examines how EU Member States would recognise insolvency or restructuring proceedings begun in a third country, such as the UK (post Brexit), the US, Japan, Australia or Canada. The table is intended only as a guide to the general principles and you should always consult local lawyers in the relevant jurisdiction to confirm the measures currently in force and the effect of any particular circumstances or nuances on your case. The questions The first question considers whether the UNCITRAL Model Law on Insolvency has been adopted in that country and, if not, whether adoption is being contemplated. A...

Introduction Alongside the formal frameworks of (i) the UNCITRAL Model Law on Cross-Border Insolvency (as implemented in England by the CBIR 2006, SI 2006/1030) and (ii) Regulation (EU) 2015/848 (the EU Recast Regulation on Insolvency) operating between Member States, parties often opt to follow non-binding guidance to support cross-border restructurings and insolvencies, including: INSOL principles (2017) INSOL TW Guidelines ALI NAFTA Principles (2001) ALI/III Co-Co Guidelines (2001) UNCITRAL Practice Guide (2009) Global Principles (2012) JIN Guidelines (2016) JIN Basic Guidelines (2025) These texts broadly mirror concepts in the EU Recast Regulation and the Model Law, reflecting the market view that swift, consensual and co-ordinated processes generally deliver stronger returns than fragmented, contested proceedings. England’s Chancery Guide (paras 21.90–21.91) encourages early consideration of adopting, with suitable modifications, one of the following for a cross-border case: the ALI/III Co-Co Guidelines, the EU Guidelines, or the JIN Guidelines. In Re Lehman Brothers International Europe (In Administration), although...