When Liquidation is NOT an Option - LPEs in Distress
When Liquidation is NOT an Option - LPEs in Distress
This global project investigated the treatment of local public entities facing financial difficulties in 20 jurisdictions around the world.
Project Overview
The treatment of local public entities (LPEs) in distress is a significantly under-researched area of insolvency and public law, particularly outside the US. However, the financial collapse of these entities frequently has a domino effect on the private sector, as well as on local, regional and national communities. Insolvency practitioners tend to know little about how LPEs in financial distress are managed. Globally, insolvency laws pertaining to LPEs are heavily influenced by local traditions, cultures and historic developments.
This project offered for the first time a global overview of the treatment of ongoing, executory contracts and obligations should LPEs file for formal insolvency or turnaround procedures.
This project was the first to examine the treatment of distressed LPEs on a global scale and the first to articulate unifying principles and standards for the laws and regulations governing the financial distress of LPEs. This project included participants from countries with varied economic and governmental structures.
This project is highly topical. In periods of financial distress, governments are keen on reducing transfers of funds to local, regional and national communities, thus directly or indirectly causing situations of financial distress to many LPEs.
This project aimed to collect information on the treatment of LPEs in financial distress around the world, with a view to providing guidance to practitioners and making recommendations for minimum standards of regulation.
The project focused on four geographical regions: Europe, Asia, Africa and the Middle East, and the America. Particularly, it covered the following jurisdictions:
AFRICA/ME: Ghana, Nigeria, South Africa and Uganda;
AMERICAS: Argentina, Brazil, Canada, the United States of America;
ASIA: Australia, Bangladesh, People’s Republic of China, Japan;
EUROPE: Belgium, Croatia, France, Germany, Italy, the Netherlands, the Russian Federation, and the United Kingdom.
The single contributions from the 20 countries analysed in the study are available in the INSOL International Technical Library. A leaflet with a summary of the key findings from the study is available here.
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