A Study On The Extraterritorial Effect Of Insolvency Proceedings

With the development of international economic communication and transnational corporations, there are more and more insolvency cases concerning international or foreign elements. The extraterritorial effect of insolvency, as the most important legal problem in cross-border insolvency, should be the basis of solving all cross-border insolvency cases. Researches on the extraterritorial effect of insolvency combined with Chinese situation are valuable to both theory and practice. This article means to explore on the issue.With respect to the writing means, comparative researches are used in this dissertation in order to probe into some key problems more clearly and distinctly. In addition to this, Chinese relevant legislation and practice are combined into the necessary discussion and explanation.Chapter One and Chapter Two, focus on the general theory of cross-border insolvency and two theories on extraterritorial effect of insolvency proceedings —universality view and territorial approach, including their meanings, inherent cause of choice by a country's legislation and comments on their advantages and disadvantages.Chapter Three to Chapter Five, expound the theory and judicial practice in some countries and international organizations. Based on the above-mentioned researches, the author points out: the closing from territoriality to universality, and the internationalization for extraterritorial effect of insolvency, have become two trends.Chapter Six probes into the regulation and judicial practice of China for problem of extraterritotial effect of insolvency. The author indicates: the crux of the matter is how to keep balance between the protection of local creditors and international cooperation in cross-border insolvency cases from the point of view of increasing the international economic communication. In view of the concrete measures and strategies, although pure "universality" view is still a kind of idealism, strict territorial approach should be given up. To a degree, the balance of emphasis being placed on the "controlled universality" principle. At last, a systematic train of thought is provided to Chineseuniform insolvency law's formulation on this problem in a special section. The dissertation advises that China should choose "controlled universality" principle in coming legislation. This attitude will conform to the development trends of modern insolvency laws, protect the interests of Chinese creditors and conduct the cooperation of cross-border insolvency cases.