Home Thoughts, From Abroad - Restructuring Recognition (and Recognition Of Restructuring)

Where a company's liquidation is necessary, deciding who or where is best placed to administer an orderly wind down for the benefit of creditors can be difficult: the shortfall of assets in an insolvency will highlight jurisdictional differences in approach as to questions of priority, frequently territorial rather than universalist.

However, certain restructuring processes have by necessity been forged under the banner of a liquidation process¹, in which case the appropriateness of a particular jurisdiction's primacy can be in danger of distortion. A tension can certainly arise if a debtor company espouses the possibility of a restructuring for which it needs negotiation breathing space; but creditors prefer a winding up before further asset erosion and/or to investigate matters leading to the company's present predicament: where that division is evident across two different jurisdictions the issue is underscored.