Recognition of a foreign “automatic stay” in Bankruptcy ‐ the position of Germany, France and the United States

Abstract

In cross-border insolvencies creditors often try to secure payment of their individual claims by attachment of the debtor's property abroad. The bankruptcy court may order a stay offoreign proceedings, but often measures of coercion will only be efficient if foreign courts co-operate. This article examines, from the viewpoint of the non-bankruptcy country, the effects of a foreign insolvency proceeding upon actions or execution proceedings in Germany, France and the United States. It deals only with the recognition of a foreign (automatic)' stay, in contrast with a domestic automatic stay as consequence of a domestic parallel bankruptcy proceeding. However, it must be kept in mind that parallel bankruptcy proceedings can be co-ordinated with each other2; in this case, they are an alternative model of co-operation.