Representatives of foreign insolvency estates, typically trustees or court-appointed administrators, may access U.S. bankruptcy courts, among other reasons, for the purpose of bringing actions to avoid and recover payments and other transfers made before insolvency proceedings were commenced, for the benefit of their foreign estates. Recovery actions may be based upon the Bankruptcy Code1 or the foreign law that is otherwise applicable. The precise remedies, and the paths to their pursuit, require navigation through various chapters and remedies of the Bankruptcy Code.

A duly recognized representative of the debtor in its foreign proceeding (“foreign representative”) may commence a bankruptcy case under chapter 15 of the Bankruptcy Code. Chapter 15 allows representatives of foreign insolvency proceedings to obtain relief in U.S. bankruptcy courts. By its plain language, chapter 15 does not allow a foreign representative to bring avoidance actions under provisions of the Bankruptcy Code. As chapter 15 has developed, however, foreign representatives have nonetheless met with some success in avoiding and recovering transfers for the benefit of foreign debtors, including by seeking relief under chapter 7 and chapter 11 of the Bankruptcy Code, which they are entitled to do under certain circumstances.

Chapter 15—Ancillary Cases

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]