Memorandum No.2

The memorandum starts with a set of recommendations, which each member has to show whether they agree/disagree with.

Comments of Association of British Chambers of Commerce

The document has the comment on EEC Bankruptcy Convention made by the Association of British Chambers of Commerce. The note hopes that the new reforms would lead to a reduction of the number of debtors declared bankrupt.

On scope, the comments suggest that the Convention only applies to judicially supervised proceedings, and not voluntary winding up. It also suggests that it applies to criminal bankruptcy.

A number of issues related to jurisdiction were discussed, for example, the applicable law, evidence and the powers of the courts.

The note suggests that revenue authorities should claim as ordinary creditors. Preferential and secured debts are also discussed.

On enforcement of judgement, the note suggests that training should be provided for court officers to understand and implement the court judgements.

The note also suggests that proper terms should be used to define mens rea. Further, a distinction must be made between the commercially reckless, and those that are guilty of fraud.

 The Association of Certified Accountants notes –Part I

The association also recommends that the Convention apply to the winding up of the insolvent deceased debtor, and that criminal bankruptcy should also be included in the Convention.

The Association of Certified Accountants notes- Part II

 On choice of law provision, the association accepts that the main objective is to reach a uniformity of substantive law among member states. It also accepts that the duty of a liquidator to his/her creditors should be absolute. The report makes a number of observations regarding Article 37.

The Association of Certified Accountants notes- Part III

 This part covers the areas of preferential and secured debts, enforcement of judgements and the uniform law.

The report explores the possible grounds of challenge of a court judgement. Further, the report deals with the difficulties relating to ‘fraudulent preferences’.

The report concludes by highlighting the fact that the Convention gives rise to issues in international law. It also said that there is a need for unification of laws across Member States.

Memorandum of the British Bankers’ Association

This memorandum focuses on the issues that the Convention could pose on bankers. On jurisdiction, the notes points to the fact that the scope of the Convention is too wide. This could lead to an ‘undisciplined scramble’ of jurisdictions across Member State.

The report recommends that the concept of registration be more closely defined in order to avoid a wide scope of applicability. Further, this report raises the concern that a floating charge might be held invalid against the company’s UK assets, if the centre of administration is in another EEC country.

The British Insurers European Committee 

This report explains in detail why the Convention should include deceased insolvents.

EEC Submissions A - C