In the insolvency of a non grantor debtor, the creditor is an unsecured creditor with an unsecured claim against the non grantor debtor.

A note of caution was struck, however, in that regard, to the effect that such laws needed to strike an appropriate balance in the treatment of privileged, secured and unsecured creditors so as to become acceptable to States.

However, in some actions the status of creditors might be in dispute or might only be established by final judgement.

However, the Working Group was urged to consider such protective measures in a manner that ensured the equality of creditors, rather than establishing a preferential treatment of local creditors to the detriment of foreign creditors.

Sovereign debt restructurings with private creditors

This does not mean that official funding should be junior to private debt in any restructuring, for that would require substantially more loss bearing capacity from the official sector capacity that is probably not available. Indeed, if official funding were junior, it would be providing a larger cushion to private creditors and thus bailing them out to an even greater extent.

Besides, an express reference to local creditors in paragraph (1) would require a definition of local creditors, which would be difficult to formulate.

The bonds were rated BBB by Standard Poor a higher ranking than Brazil's sovereign position at the time.

That arrangement would involve private creditors in negotiating terms of a restructuring the provision of financial support by IMF can improve the bargaining position of the debtor, and combined with the adjustment programme, can signal to the unpaid creditors that their interest is best served by quickly reaching an agreement with the debtor.

15. Reiterates the importance of the orderly resolution of sovereign debt crises, notes the increasing voluntary use of collective action clauses in international sovereign bonds, and takes note of the efforts led by sovereign debtors and private creditors to develop a voluntary code of conduct for the resolution of sovereign debt crises

Haiti's external debt represents more than 1 billion with an accumulation of arrears towards multilateral (US 1,091.30 million) and bilateral (US 209.10 million) creditors (see table below).

It was noted, however, that one of the reasons the mechanism had failed to gain support was that IMF could not be regarded as a neutral arbitrator, given its preferred creditor status.

The interests of local creditors and of the creditors as a whole were not necessarily fostered by promoting the opening of parallel proceedings.

It was noted that the purpose of draft article 11 was generally to establish the equality of treatment between foreign and local creditors.

This Regulation applies only to proceedings where the centre of the debtor's main interests is located in the Community.

However, it was observed that foreign creditors, by not having direct access to local publications of limited circulation, found themselves in a less advantageous situation than local creditors.

To the extent that the value of the encumbered asset is insufficient to satisfy the secured creditor's claim, the secured creditor may participate as an ordinary unsecured creditor.

At the end of the day, debt forgiveness benefits creditors as much as it helps debtors. Creditors have known this since at least the sixteenth century, when Spain s King Philip II became the world s first known serial sovereign defaulter.

IV. Equal status and human rights of women

B. Human rights and the status of women

In response, it was pointed out that an approach based on the law of the country of the debtor apos s place of business would not be appropriate, since draft article 24 dealt with competing rights of creditors of the assignor and not with the rights and obligations of the debtor.

The most noteworthy was the IMF sovereign debt restructuring mechanism,29 which suggested some core features majority rule in restructuring decisions, a legal stay against claims by creditors, protection of creditors' interests, seniority of new money and a dispute resolution forum.

Debt relief is, however, dependent on all creditors spreading the burden fairly among themselves.

recognition 67 71 16 Article 19.

(b) Provide a temporal event for ordering priority among secured creditors and between a secured creditor and other classes of competing claimants.

Table 3 Recent sovereign debt restructurings with private creditors main features

(c) Ensure equitable burden sharing with private creditors

Status of the proposed new human rights body

First, it aims to ensure that obligations are fairly and regularly met when a debtor becomes financially insolvent. Thus, it seeks to protect the lawful rights of both creditors and debtors.

Because secured transactions affect the interests of various persons, including the debtor, other grantors, competing creditors, such as secured, privileged and unsecured creditors, purchasers and other transferees, and the State, the Guide proposes rules that take into account their legitimate interests and seek to achieve, in a balanced way, all the objectives mentioned above.

(ii) A creditor of the assignor or

Finally, it is important to recognize the contribution that efficient and equitable burden sharing between debtors and creditors can make to alleviating unsustainable debt burdens.

In reply, it was observed that, for example, the names and addresses of foreign creditors would be obtainable from the debtor apos s books and correspondence and that in the case of debtor initiated insolvencies, national laws often required the debtor to produce a full list of creditors.

Because healthy competition among all potential creditors is an effective way of reducing the cost of credit, the Guide recommends that the secured transactions regime apply equally to various creditors, including banks and other financial institutions, as well as domestic and non domestic creditors.

In response to that suggestion it was noted that such a provision would in fact prompt the opening of a local proceeding, a result which might not always be in the interests of all creditors, including local creditors.

The law should provide that a secured creditor with a security right that is not effective against third parties has towards third parties no right other than as an unsecured creditor priority over unsecured creditors unless the unsecured creditor has taken steps to reduce its claim to a judgement or the grantor has become insolvent .

(e) Protection of the insolvency estate against the actions of creditors, the debtor itself and the insolvency representative, and where the protective measures apply to secured creditors, the manner in which the economic value of the security interest will be protected during the insolvency proceedings

(a) Whether creditors have dealt with a group of companies as a single economic unit

Legion of Goodwill (General, 1999)

It had the merit of recognizing the role of the courts, ensuring equitable treatment for local creditors, providing that recognition of foreign proceedings would not prevent local creditors from initiating collective insolvency proceedings and providing that relief available to the foreign representative was subject to the protection granted to local creditors and to compliance with procedural requirements in the enacting State.

If the form of notification were to be left to national law, foreign creditors would be in a less advantageous situation than local creditors, since they typically do not have direct access to local publications.

The view was expressed that article 16 should aim at the protection of all creditors, foreign and local, in essentially the same manner and should establish a parallel between the powers that could be exercised by a local and a foreign representative.

(a) Enable a potential secured creditor to determine, in an efficient manner and with a high degree of certainty prior to extending credit, the priority that the security rights would have over competing claimants and

(172) The insolvency law should specify whether secured creditors are required to submit claims.

VI. Equal status and human rights of women