Inter-creditor Equity in Sovereign Debt Restructuring

Abstract

This dissertation explores the relationship among creditors in

sovereign debt restructuring and specifically focuses on the issue of

inter-creditor equity. It consists of five ar ticles focusing on the core issues regarding inter-creditor equity in the context of domestic insolvency law. It is largely inspired by international developments on the legal reform and practice of sovereign debt restructuring in the past three years. Overall, this disser tation argues that a multilateral legal framework for sovereign debt restructuring should not take the form of a collective proceeding and should not include debt claims with all types of maturities. In the context of a cram-down, a safeguard procedure should be put in place to ensure that any amendment of the contract terms imposed by majority bondholders is fair and equitable with respect to minority bondholders who have voted against the amendment. Arbitral tr ibunals established pursuant to international investment treaties could serve as an appropriate forum to develop such a safeguard provision. A new arbitral tribunal, preferably modelled after the tribunal concerning the Bank for International Settlements, could apply the safeguard provision once developed, because not all