ISSUE OF CROSS-BORDER INSOLVENCY : IS INSOLVENCY PROTOCOLASUCCESS STORY IN INDIA?

• Sharma, Sandhya

  University of Delhi

  Author

• Vahini, Versha

  Author

The use of cross-border insolvency protocols is expected to rise due to the growing volume of cross-border commerce and corporate transactions, which frequently include organisations possessing assets and incurring liabilities in many jurisdictions.

As evident from the discussion in this paper that, insolvency protocols have emerged out of necessity and will persist in that manner. The protocol in Maxwell served as an innovative mechanism to resolve the dispute between the legal procedures of the United States and the United Kingdom. The protocol that was implemented in Lehman and Madoff case provided the streamlined communication, synchronisation, and exchange of information. Therefore, each protocol caters to the requirements of a particular scenario, rendering it highly attractive tool in cross-border insolvency cases.

 If courts and judges enthusiastically advocate insolvency protocols, they may become the standard norm and allow parties to pre-arrange with creditors regarding protocol terms. This would reduce uncertainty in insolvency proceedings, easing concerns among creditors of huge multi-nation corporations. Still, there is no clarity whether courts would be upholding such pre-existing commercial agreements, as while doing so it will restrict the ability to customise the protocols as per the need and requirement of each case.

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