Understanding Cross-Border Insolvency Protocols

Cross-border insolvency protocols are pivotal tools aimed at facilitating coordination during insolvency proceedings that span multiple jurisdictions. These protocols can be categorized as either commercial contracts or court-based tools, often depending on the context in which they are used. Historically, they were adopted due to the absence of a cohesive international insolvency law framework, allowing lawyers and courts to create agreements that promote cooperative strategies in handling insolvency cases across borders. Examples of situations where these protocols have been utilized include high-profile bankruptcies such as Lehman Brothers, Maxwell Communications, and recent cases like the failed crypto hedge fund Three Arrows Capital.