Fletcher Moot 2026 Competition

International insolvency law addresses the legal complications that arise when an insolvent debtor has assets, creditors, or operations in more than one jurisdiction. Historically, states approached insolvency through the doctrine of 'territoriality,' under which each jurisdiction administered the assets within its borders according to its own laws. This produced asset grabs, inconsistent treatment of creditors, and value destruction in transnational bankruptcies. As global trade and multinational corporate structures expanded in the late twentieth century, the limits of territoriality became acute, with high-profile failures such as BCCI (1991), Maxwell Communications (1991), and later Lehman Brothers (2008) demonstrating the need for coordinated regimes. The modern field has gravitated toward 'modified universalism,' under which a debtor's main insolvency proceeding in its center of main interests (COMI) is recognized abroad, while local courts retain limited authority over assets and creditors in their territory. This approach is reflected in the EU Insolvency Regulation (Recast 2015/848), the UNCITRAL Model Law on Cross-Border Insolvency (1997), and a growing body of bilateral protocols and court-to-court communication guidelines such as the JIN Guidelines. Soft-law instruments and judicial cooperation have filled gaps where treaty-making has proven politically difficult. Today, the field grapples with several unresolved tensions: the treatment of multinational enterprise groups rather than single entities; the recognition of insolvency-related judgments (addressed in UNCITRAL's 2018 Model Law on Recognition and Enforcement of Insolvency-Related Judgments); sovereign and quasi-sovereign debt restructurings; and the use of forum shopping for restructuring tools such as the English scheme of arrangement, the Dutch WHOA, and US Chapter 11. Asymmetric adoption of UNCITRAL instruments — strong uptake in common-law jurisdictions, slower uptake in civil-law and emerging economies — remains a structural challenge.

The UNCITRAL Model Law on Cross-Border Insolvency was adopted in 1997 to provide states with a template for handling insolvencies involving foreign debtors, creditors, or assets. It emerged from collaboration between UNCITRAL and INSOL International in response to the increasing frequency of multinational insolvencies and the inadequacy of purely territorial regimes. Rather than a treaty, the Model Law is a legislative template that states adapt into domestic law, preserving sovereignty while promoting convergence on core procedural principles: access for foreign representatives, recognition of foreign proceedings, available relief, and cooperation between courts. Central to the Model Law is the distinction between 'foreign main proceedings,' opened in the debtor's center of main interests (COMI), and 'foreign non-main proceedings,' opened where the debtor has an establishment. Recognition of a main proceeding triggers an automatic stay and other relief, facilitating orderly administration. The Model Law has been enacted in approximately 60 jurisdictions, including the United States (Chapter 15 of the Bankruptcy Code, 2005), the United Kingdom (Cross-Border Insolvency Regulations 2006), Japan, Singapore, Australia, South Africa, and Mexico, among others. Notable holdouts include China, India (which adopted the law in principle but has not operationalized it), and most of continental Europe outside the EU Insolvency Regulation framework. Application has generated significant jurisprudence on COMI determination, the public policy exception, and the scope of relief available post-recognition. Landmark cases such as Rubin v. Eurofinance (UKSC 2012) exposed limits in the recognition of insolvency-related judgments, prompting UNCITRAL's 2018 supplementary Model Law on that subject. Debates continue over whether the Model Law adequately handles corporate group insolvencies, restructuring plans that bind dissenting foreign creditors, and the COMI of digital-asset and decentralized businesses — issues sharpened by the FTX and Three Arrows Capital collapses.

The UNCITRAL Model Law on Enterprise Group Insolvency was adopted by the UN General Assembly in 2019 to address a structural gap in the 1997 Model Law: most multinational businesses operate as integrated groups of legally distinct entities, yet cross-border insolvency frameworks have traditionally treated each entity in isolation. Group structures permit operational synergies but produce serious coordination problems when financial distress hits, including duplicative proceedings, value destruction from disorderly liquidation of interdependent subsidiaries, and disputes over intercompany claims and asset commingling. Cases such as Lehman Brothers, Nortel Networks, and Jet Airways illustrated how single-entity tools were inadequate for groups spanning dozens of jurisdictions. The instrument introduces the concept of a 'planning proceeding' — a main insolvency proceeding for one or more group members in the group's center of main interests, in which a coordinated 'group insolvency solution' can be developed for the entire enterprise. It allows participating courts and insolvency representatives to cooperate, share information, and recognize the planning proceeding without subordinating their own jurisdictional authority. Crucially, it permits relief in foreign jurisdictions to support a group solution, while preserving local creditor protections and public policy exceptions. The instrument complements rather than replaces the 1997 Model Law and the 2018 Model Law on Insolvency-Related Judgments. Uptake has been slow. As of the mid-2020s, only a handful of jurisdictions have enacted or formally moved toward enactment, in part because the instrument is technically demanding and presupposes a developed cross-border insolvency culture. Debate centers on whether 'planning proceeding' jurisdiction will encourage forum shopping toward debtor-friendly venues, how it interacts with the EU Insolvency Regulation's group coordination provisions, and whether it can adequately handle state-owned enterprises and groups whose center of management is opaque. The instrument is also being tested conceptually against complex restructurings of crypto-asset platforms and integrated supply-chain failures.