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Michael Murray’s on-going commentary on issues in corporate and personal insolvency law and related policy and law reform, in Australia and internationally. Given the scope of insolvency, this extends to business, consumer and professional conduct, and ethics, governance and regulation, criminal, tax, environmental and administrative law, and the courts and government.

 

UNCITRAL’s 50 Years – Cross-border insolvency of corporate groups; recognition of insolvency judgments – UNCCA

A conference in celebration of the 50th anniversary of UNCITRAL was held in Brisbane on 2 December 2016. Among other issues discussed was the UNCITRAL meeting in Vienna commencing 12 December 2016 of Working Group V which is developing a code for the cross-border insolvency of corporate groups; and for the recognition of foreign insolvency judgments.  

At the conference, the Attorney-General expressed appreciation for the work of the local UNCITRAL Coordination Committee Australia (UNCCA) in its support of Australian input to the work of UNCITRAL

 

The United Nations Commission on International Trade Law (UNCITRAL) is the core legal body of the United Nations system in the field of international trade law. It was established on 17 December 1966. The conference was held by the University of Queensland, UNCITRAL, UNCCA, and the Australian Attorney-General’s Department (AGD). 

UNCITRAL has been specialising in commercial law reform worldwide for over 40 years, with a view to the modernisation and harmonisation of rules on international business. The Model Law on Cross-border Insolvency is one product of its work, along with the UN Convention on Contracts for the International sale of Goods (CISG) and the recent UNCITRAL Model Law on Secured Transactions.   

UNCCA, chaired by Tim Castle in Sydney, promotes the work of UNCITRAL in Australia and supports its overseas working group meetings.

The Attorney-General, the Hon George Brandis QC, spoke to the meeting by video, explaining the history of UNCITRAL and Australia’s involvement, and the important contribution made by UNCCA and its members to the development of international trade laws and guidance.

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The main speech was given by the Hon Justice James Douglas of the Supreme Court of Queensland, who raised the issue of the knowledge and reception of international conventions in Australian law and court decisions, in particular the CISG.  Jenny Clift, the Senior Legal Officer at the UNCITRAL Secretariat in Vienna, spoke on the history of UNCITRAL from an Australian perspective, and the influence and standing of Australia’s contributions over the years.  Jenny is also the Secretary of UNCITRAL Working Group V (Insolvency) and the Head of the Technical Assistance and Cooperation Unit. 

The day was opened by Professor Sarah Derrington, Dean and Head of the TC Beirne Law School, and by Tim Castle as founding chair of UNCCA.

Following topics included future directions in cross-border insolvency, secured transactions and the CISG, international arbitrations, and electronic transferable records and communications.  Speakers included Emeritus Professor Mary Hiscock, Bond University; Dr Alan Davidson, UQ and UNCCA; Luca Castellani, Secretary of Working Group IV in Vienna; Professor Rosalind Mason , QUT; Professor Sheelagh McCracken, University of Sydney; James Green, barrister; Marina Kofman, Australian Centre for International Commercial Arbitration; Jeremy Shelley of AGD; and Annabelle Simpson, student delegate to UNCITRAL. 

UNCITRAL

The various working groups of UNCITRAL are these

Working Group I – Presently examining micros, small and medium sized enterprises

Working Group II – Arbitration and Conciliation and Dispute Settlement

Working Group III – Online Dispute Resolution

Working Group IV – Electronic Commerce

Working Group V – Insolvency Law

Working Group V – Insolvency Law

I am attending the meeting of WGV in Vienna from 12 to 16 December 2016 on behalf of LAWASIA. It is examining these two issues.

Cross-border insolvency of multinational enterprise groups

Working Group V is examining cross-border insolvency of multinational enterprise groups and is developing provisions on a number of issues, some of which would extend the existing provisions of the Model Law on Cross-Border Insolvency and of Part Three of the UNCITRAL Legislative Guide on Insolvency Law. There is also the UNCITRAL Practice Guide on Cross-Border Insolvency.

The key elements of how the law might be developed include those that might be based upon the Legislative Guide and on the Model Law; and the form that the text might take, noting that some of the key elements lend themselves to being developed as a model law, while others are more suitable for inclusion in a legislative guide.

Working Group V has already agreed to a set of key principles and has considered a number of draft provisions addressing three main areas:

(a) the coordination and cooperation of insolvency proceedings relating to an enterprise group;

(b) the elements needed for the development and approval of a group insolvency solution involving multiple entities; and

(c) the use of so-called “synthetic proceedings” in lieu of commencing “non-main” proceedings.

Two additional supplementary areas might include

(d) the use of synthetic proceedings in lieu of commencing “main” proceedings, and

(e) approval of a group insolvency solution on a more streamlined basis by reference to the adequate protection of the interests of creditors of affected group members. 

Working Group V has developed a consolidated draft legislative text incorporating the agreed key principles and draft provisions addressing those five areas.

That draft text has been revised for further consideration at the session in the week of 12-16 December 2016.

Recognition and enforcement of insolvency-related judgments

Working Group V is also developing a model law or model legislative provisions for the recognition and enforcement of insolvency-derived judgments. It has identified a number of key issues to be addressed in a draft instrument, which it was agreed should be developed as a standalone model law, as opposed to forming part of the existing Model Law.

The Working Group has discussed a first draft of a model law. This is also listed for consideration at the session commencing 12 December.

Comment

Any comment or input of request for further information can me made to me, Michael Murray, as representing LAWASIA and UNCCA at this session in Vienna.

 

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