II. The Suggestions for Improving China's Cross-border Insolvency Recognition and Assistance: Adopting the UNCITRAL Model Law
The United Nations Commission on International Trade Law (UNCITRAL) adopted the Model Law on Cross-border Insolvency (hereinafter referred to as the "Model Law") in 1997, which has become the most important legal document on cross-border insolvency cooperation in the world. Thus far, the Model Law has been adopted in 55 jurisdictions, including the major trading and investment partners of the PRC. The adoption of the Model Law as soon as possible is of great significance for improving China's cross-border insolvency legislation and judicial practice.
II.1 It is in the Interest of China to Adopt the Model Law
With the continuous advancement of China's reform and opening up policy and the "Belt and Road" initiative, China has transformed herself from a traditional capital importing country to a capital exporting country in 2015. Judging from the decisions and experiences of the United States, the United Kingdom, Singapore, Japan, and South Korea in adopting the Model Law, international cooperation on cross-border insolvency issues is increasingly in line with China's interests. Especially in the context of promoting the "Belt and Road Initiative", promoting the cooperation among different jurisdictions in the field of cross-border insolvency is of great importance to China in attracting more international investment and trade.
The Supreme People's Court has attached more and more importance to cross-border insolvency issues in recent years. In addition to the Minutes of Meetings promulgated mentioned above, actively engaging itself in the revision of the EBL also constitutes a key step. Furthermore, the SPC will discuss and deal with such core issues as the jurisdiction of cross-border insolvency, the status and treatment of foreign bankruptcy representatives and creditors, the conditions and methods of granting judicial assistance to foreign bankruptcy proceedings, etc. And a group of judges proficient in foreign law and international commercial dispute resolution will be trained in an effort to strengthening international cooperation in the area as well.
II. 2Adopting the Model Law does no Harm to China's Interests
The international cooperation advocated by the Model Law is based on pragmatic considerations. Access, recognition, relief, coordination and cooperation are the four main elements of the Model Law. The Model Law establishes simplified procedures for foreign insolvency proceedings and recognition of foreign representatives, providing a degree of certainty as to whether the court will make a decision on recognition. Reliefs are divided into four categories, including automatic relief, discretionary relief, interim relief, and relief that grant foreign representatives the standing to participate in various domestic bankruptcy proceedings. The Model Law separates recognition from relief, granting the judges with flexible discretion, allowing the stakeholders to initiate parallel insolvency proceedings, and also giving judge the freedom to modify or terminate relief where necessary, among others. In addition, the framework established by the Model Law supports communication and cooperation between courts in different jurisdictions, as well as between courts and foreign administrators, in order to handle cross-border insolvency cases in a more efficient way.
As a golden international norm and the best model for coping with cross-border insolvency cooperation, the Model Law strikes a delicate balance between encouraging international cooperation and protecting the interests of enacting States: on the one hand, it only coordinating proceedings in different jurisdictions from procedural angles, without touching on the complex substantive laws; on the other hand, it focuses on protecting the core interests of the enacting states in cross-border insolvency cases, including national sovereignty, core values and employees' rights and interests, etc. Based on this flexibility, when China adopts the Model Law, in maintaining the basic spirit of cooperation and coordinated framework, it can make necessary and flexible adjustments to relevant provisions according to its practical needs, in order to ensure that China's interests are not harmed.
In conclusion, as one of the important indicators of the country's legal and business environment, the bankruptcy system has a huge impact on economic development. From the perspective of international practice in recent years, the international competition in cross-border insolvency and reorganization has become increasingly fierce. Singapore has in recent years committed itself to becoming a new international bankruptcy and reorganization center, and Singapore International Commercial Court recently brought in a retired US bankruptcy judge to strengthen its trial power in cross-border insolvency matters. China should recognize the importance of cross-border insolvency cooperation in creating a more competitive economic and trade environment, and in line with the current needs of improving bankruptcy legislation and judicial practice, take the opportunity of revising the EBL to adopt the Model Law. After becoming a jurisdiction adopting the "Model Law", China may further improve the domestic bankruptcy regulations, actively promote the two-way recognition and assistance in cross-border insolvency cooperation, and finally promote the healthy development of China's international investment and trade.