Becomes 41st State to enact legislation based on the Model Law
NEW YORK, United States of America, November 20, 2015
With its adoption of the Insolvency Bill 2014 on 18 November 2015, Malawi has become the 41st State in the world to have enacted legislation based on the United Nations Commission on International Trade Law (UNCITRAL) Model Law on Cross-Border Insolvency. It is expected that the Bill will be gazetted as the Insolvency Act 2015 in December 2015. Reform of the Insolvency Act has been accompanied by significant reforms to the Companies Act.
The UNCITRAL Model Law on Cross-Border Insolvency, adopted in 1997, is designed to assist States to equip their insolvency laws with a modern, harmonized and fair framework to address more effectively instances of cross-border insolvency. Those instances include cases where the insolvent debtor has assets in more than one State or where some of the creditors of the debtor are not from the State where the insolvency proceeding is taking place. The Model Law respects the differences among national procedural laws and does not attempt a substantive unification of insolvency law. It offers solutions that help in several modest but significant ways. These include the following: foreign assistance for an insolvency proceeding taking place in the enacting State; foreign representatives’ access to courts of the enacting State; recognition of foreign proceedings; cross-border cooperation; and coordination of concurrent proceedings.
The Model Law was drafted by UNCITRAL’s Working Group on Insolvency Law, approved and adopted by the Commission in May 1997 and endorsed by the United Nations General Assembly in December 1997. Prior to enactment of the Insolvency Act in Malawi, legislation based on the Model Law had been adopted in the following jurisdictions: Australia (2008); Benin (Organisation pour l’Harmonisation en Afrique du Droit des Affaires (OHADA) – 2015); British Virgin Islands (2003); Burkina Faso (OHADA – 2015); Cameroon (OHADA – 2015); Canada (2005); Central African Republic (OHADA – 2015); Chad (OHADA – 2015); Chile (2013); Colombia (2006); Comoros (OHADA – 2015); Congo (OHADA – 2015); Côte d’Ivoire (OHADA – 2015); Democratic Republic of the Congo (OHADA – 2015); Equatorial Guinea (OHADA – 2015); Gabon (OHADA – 2015); Great Britain (2006); Greece (2010); Guinea (OHADA – 2015); Guinea-Bissau (OHADA – 2015); Japan (2000); Kenya (2015); Mali (OHADA – 2015); Mauritius (2009); Mexico (2000); Montenegro (2002); New Zealand (2006); Niger (OHADA – 2015); Philippines (2010); Poland (2003); Republic of Korea (2006); Romania (2002); Senegal (OHADA – 2015); Serbia (2004); Seychelles (2013); Slovenia (2007); South Africa (2000); Togo (OHADA – 2015); Uganda (2011); Vanuatu (2013); and the United States (2005).
United Nations (UN)