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| Iraq-Jordan |
| CPA plans Iraq bankrutpcy law to aid investment |
| 2004-04-05 |
| LONDON, April 2 (Reuters) - Iraq's U.S.-led authority is planning to introduce a U.S.-style bankruptcy law which will increase protection for foreign investors, a consultant to the CPA said on Friday. The Coalition Provisional Authority (CPA) -- headed by U.S. administrator Paul Bremer -- is currently passing up to 100 pieces of legislation ahead of a handover to an Iraqi-led government, timetabled for June 30. One expected change will clarify creditors' protection under a new bankruptcy law. This is considered important in order to mobilise the billions of dollars of inward investment the country needs to regenerate its economy. "Whether the economy moves forward depends on the confidence bankers have that they will be repaid," Daniel Fitzpatrick told Reuters. "The new bankruptcy law will contribute towards the predictability of that process." A group of Iraqi lawyers and foreign consultants worked on the amendments to the old bankruptcy law and circulated them among domestic and foreign agencies, including Iraqi bankers, judges and the World Bank. One of the most important amendments to the law is a clarification that secured creditors will rank first in the distribution of assets of a bankrupt company. Other amendments include softening punishments for managers of bankrupt companies -- which included imprisonment and prohibition from holding various jobs -- and encouraging negotiated work-outs between a debtor and its creditors. "One of the goals of the legislation is fostering a more entrepreneurial, risk-friendly culture," said Fitzpatrick. A troubled company will have protection from its creditors while it negotiates a reorganisation plan which the creditors can then vote on -- a process generally similar to the U.S. Chapter 11 bankruptcy procedure. Under other amendments, Iraqi courts will be authorised to recognise cross-border bankruptcy procedures, for instance when a multinational company working in Iraq gets into financial trouble. The next stage for the law is consideration by the Iraqi Governing Council, followed by a formal signing by Bremer. |
| Posted by:Steve White |
| #2 Was it posted on this site that only Bremer's worth his salt, that W's put in sons of campaign contributors and they're making a mess of everything??? |
| Posted by: Anonymous2U 2004-04-05 1:05:33 PM |
| #1 Sounds real messy! Will Iraqi's forgive someone's debt because he's filed for bankrutpcy, or ask for their children instead. |
| Posted by: Anonymous4016 2004-04-05 1:23:59 AM |