184
‘‘(II) must have been filed in a
manner permitted by applicable non-
bankruptcy law; or’’.
SEC. 815. DISCHARGE OF THE ESTATE’S LIABILITY FOR UN-
PAID TAXES.
Section 505(b) of title 11, United States Code, is
amended in the second sentence by inserting ‘‘the estate,’’
after ‘‘misrepresentation,’’.
SEC. 816. REQUIREMENT TO FILE TAX RETURNS TO CON-
FIRM CHAPTER 13 PLANS.
(a) FILING
OF PREPETITION TAX RETURNS RE-
QUIRED FOR PLAN CONFIRMATION.—Section 1325(a) of
title 11, United States Code, as amended by section 143,
is amended—
(1) in paragraph (6) by striking ‘‘and’’ at the
end;
(2) in paragraph (7) by striking the period at
the end and inserting ‘‘; and’’; and
(3) by adding at the end the following:
‘‘(8) if the debtor has filed all Federal, State,
and local tax returns as required by section 1308 of
this title.’’.
(b) ADDITIONAL TIME PERMITTED FOR FILING TAX
RETURNS.—(1) Chapter 13 of title 11, United States
185
Code, as amended by section 137, is amended by adding
at the end the following:
‘‘§ 1308. Filing of prepetition tax returns
‘‘(a) On or before the day prior to the day on which
the first meeting of the creditors is convened under section
341(a) of this title, the debtor shall have filed with appro-
priate tax authorities all tax returns for all taxable periods
ending in the 3-year period ending on the date of filing
of the petition.
‘‘(b) If the tax returns required by subsection (a)
have not been filed by the date on which the first meeting
of creditors is convened under section 341(a) of this title,
the trustee may continue such meeting for a reasonable
period of time, to allow the debtor additional time to file
any unfiled returns, but such additional time shall be no
more than—
‘‘(1) for returns that are past due as of the
date of the filing of the petition, 120 days from such
date;
‘‘(2) for returns which are not past due as of
the date of the filing of the petition, the later of 120
days from such date or the due date for such re-
turns under the last automatic extension of time for
filing such returns to which the debtor is entitled,
186
and for which request has been timely made, accord-
ing to applicable nonbankruptcy law; and
‘‘(3) upon notice and hearing, and order en-
tered before the lapse of any deadline fixed accord-
ing to this subsection, where the debtor dem-
onstrates, by clear and convincing evidence, that the
failure to file the returns as required is because of
circumstances beyond the control of the debtor, the
court may extend the deadlines set by the trustee as
provided in this subsection for—
‘‘(A) a period of no more than 30 days for
returns described in paragraph (1) of this sub-
section; and
‘‘(B) for no more than the period of time
ending on the applicable extended due date for
the returns described in paragraph (2).
‘‘(c) For purposes of this section only, a return in-
cludes a return prepared pursuant to section 6020 (a) or
(b) of the Internal Revenue Code of 1986 or similar State
or local law, or a written stipulation to a judgment entered
by a nonbankruptcy tribunal.’’.
(2) The table of sections of chapter 13 of title 11,
United States Code, is amended by inserting after the
item relating to section 1307 the following:
‘‘1308. Filing of prepetition tax returns.’’.
187
(c) DISMISSAL
OR CONVERSION
ON FAILURE TO
COMPLY.—Section 1307 of title 11, United States Code,
is amended—
(1) by redesignating subsections (e) and (f) as
subsections (f) and (g), respectively; and
(2) by inserting after subsection (d) the follow-
ing:
‘‘(e) Upon the failure of the debtor to file tax returns
under section 1308 of this title, on request of a party in
interest or the United States trustee and after notice and
a hearing, the court shall dismiss a case or convert a case
under this chapter to a case under chapter 7 of this title,
whichever is in the best interests of creditors and the es-
tate.’’.
(d) TIMELY FILED CLAIMS.—Section 502(b)(9) of
title 11, United States Code, is amended by striking the
period at the end and inserting ‘‘, and except that in a
case under chapter 13 of this title, a claim of a govern-
mental unit for a tax in respect of a return filed under
section 1308 of this title shall be timely if it is filed on
or before 60 days after such return or returns were filed
as required.’’.
(e) RULES FOR OBJECTIONS TO CLAIMS AND TO
CONFIRMATION.—It is the sense of the Congress that the
Advisory Committee on Bankruptcy Rules of the Judicial
188
Conference should, within a reasonable period of time
after the date of the enactment of this Act, propose for
adoption amended Federal Rules of Bankruptcy Proce-
dure which provide that—
(1) notwithstanding the provisions of Rule
3015(f), in cases under chapter 13 of title 11,
United States Code, a governmental unit may object
to the confirmation of a plan on or before 60 days
after the debtor files all tax returns required under
sections 1308 and 1325(a)(7) of title 11, United
States Code; and
(2) in addition to the provisions of Rule 3007,
in a case under chapter 13 of title 11, United States
Code, no objection to a tax in respect of a return re-
quired to be filed under such section 1308 shall be
filed until such return has been filed as required.
SEC. 817. STANDARDS FOR TAX DISCLOSURE.
Section 1125(a) of title 11, United States Code, is
amended in paragraph (1)—
(1) by inserting after ‘‘records,’’ the following:
‘‘including a full discussion of the potential material
Federal, State, and local tax consequences of the
plan to the debtor, any successor to the debtor, and
a hypothetical investor domiciled in the State in
which the debtor resides or has its principal place of
189
business typical of the holders of claims or interests
in the case,’’;
(2) by inserting ‘‘such’’ after ‘‘enable’’; and
(3) by striking ‘‘reasonable’’ where it appears
after ‘‘hypothetical’’ and by striking ‘‘typical of hold-
ers of claims or interests’’ after ‘‘investor’’.
SEC. 818. SETOFF OF TAX REFUNDS.
Section 362(b) of title 11, United States Code, as
amended by sections 120, 134, 139, and 203, is
amended—
(1) in paragraph (29) by striking ‘‘or’’;
(2) in paragraph (29) by striking the period at
the end and inserting ‘‘; or’’; and
(3) by inserting after paragraph (29) the fol-
lowing:
‘‘(30) under subsection (a) of the setoff of an
income tax refund, by a governmental unit, in re-
spect of a taxable period which ended before the
order for relief against an income tax liability for a
taxable period which also ended before the order for
relief, unless—
‘‘(A) prior to such setoff, an action to de-
termine the amount or legality of such tax li-
ability under section 505(a) was commenced; or
190
‘‘(B) where the setoff of an income tax re-
fund is not permitted because of a pending ac-
tion to determine the amount or legality of a
tax liability, the governmental unit may hold
the refund pending the resolution of the ac-
tion.’’.
TITLE IX—ANCILLARY AND
OTHER CROSS-BORDER CASES
SEC. 901. AMENDMENT TO ADD CHAPTER 15 TO TITLE 11,
UNITED STATES CODE.
(a) IN GENERAL.—Title 11, United States Code, is
amended by inserting after chapter 13 the following:
‘‘CHAPTER 15—ANCILLARY AND OTHER
CROSS-BORDER CASES
‘‘Sec.
‘‘1501. Purpose and scope of application.
‘‘SUBCHAPTER I—GENERAL PROVISIONS
‘‘1502. Definitions.
‘‘1503. International obligations of the United States.
‘‘1504. Commencement of ancillary case.
‘‘1505. Authorization to act in a foreign country.
‘‘1506. Public policy exception.
‘‘1507. Additional assistance.
‘‘1508. Interpretation.
‘‘SUBCHAPTER II—ACCESS OF FOREIGN REPRESENTATIVES AND
CREDITORS TO THE COURT
‘‘1509. Right of direct access.
‘‘1510. Limited jurisdiction.
‘‘1511. Commencement of case under section 301 or 303.
‘‘1512. Participation of a foreign representative in a case under this title.
‘‘1513. Access of foreign creditors to a case under this title.
‘‘1514. Notification to foreign creditors concerning a case under this title.
‘‘SUBCHAPTER III—RECOGNITION OF A FOREIGN PROCEEDING
AND RELIEF
191
‘‘1515. Application for recognition of a foreign proceeding.
‘‘1516. Presumptions concerning recognition.
‘‘1517. Order recognizing a foreign proceeding.
‘‘1518. Subsequent information.
‘‘1519. Relief that may be granted upon petition for recognition of a foreign
proceeding.
‘‘1520. Effects of recognition of a foreign main proceeding.
‘‘1521. Relief that may be granted upon recognition of a foreign proceeding.
‘‘1522. Protection of creditors and other interested persons.
‘‘1523. Actions to avoid acts detrimental to creditors.
‘‘1524. Intervention by a foreign representative.
‘‘SUBCHAPTER IV—COOPERATION WITH FOREIGN COURTS AND
FOREIGN REPRESENTATIVES
‘‘1525. Cooperation and direct communication between the court and foreign
courts or foreign representatives.
‘‘1526. Cooperation and direct communication between the trustee and foreign
courts or foreign representatives.
‘‘1527. Forms of cooperation.
‘‘SUBCHAPTER V—CONCURRENT PROCEEDINGS
‘‘1528. Commencement of a case under this title after recognition of a foreign
main proceeding.
‘‘1529. Coordination of a case under this title and a foreign proceeding.
‘‘1530. Coordination of more than 1 foreign proceeding.
‘‘1531. Presumption of insolvency based on recognition of a foreign main pro-
ceeding.
‘‘1532. Rule of payment in concurrent proceedings.
‘‘§ 1501. Purpose and scope of application
‘‘(a) The purpose of this of chapter is to incorporate
the Model Law on Cross-Border Insolvency so as to pro-
vide effective mechanisms for dealing with cases of cross-
border insolvency with the objectives of—
‘‘(1) cooperation between—
‘‘(A) United States courts, United States
Trustees, trustees, examiners, debtors, and
debtors in possession; and
‘‘(B) the courts and other competent au-
thorities of foreign countries involved in cross-
border insolvency cases;
192
‘‘(2) greater legal certainty for trade and in-
vestment;
‘‘(3) fair and efficient administration of cross-
border insolvencies that protects the interests of all
creditors, and other interested entities, including the
debtor;
‘‘(4) protection and maximization of the value
of the debtor’s assets; and
‘‘(5) facilitation of the rescue of financially
troubled businesses, thereby protecting investment
and preserving employment.
‘‘(b) This chapter applies where—
‘‘(1) assistance is sought in the United States
by a foreign court or a foreign representative in con-
nection with a foreign proceeding;
‘‘(2) assistance is sought in a foreign country in
connection with a case under this title;
‘‘(3) a foreign proceeding and a case under this
title with respect to the same debtor are taking place
concurrently; or
‘‘(4) creditors or other interested persons in a
foreign country have an interest in requesting the
commencement of, or participating in, a case or pro-
ceeding under this title.
‘‘(c) This chapter does not apply to—
193
‘‘(1) a proceeding concerning an entity identi-
fied by exclusion in subsection 109(b);
‘‘(2) an individual, or to an individual and such
individual’s spouse, who have debts within the limits
specified in section 109(e) and who are citizens of
the United States or aliens lawfully admitted for
permanent residence in the United States; or
‘‘(3) an entity subject to a proceeding under the
Securities Investor Protection Act, a stockbroker
subject to subchapter III of chapter 7 of this title,
or a commodity broker subject to subchapter IV of
chapter 7 of this title.
‘‘SUBCHAPTER I—GENERAL PROVISIONS
‘‘§ 1502. Definitions
‘‘For the purposes of this chapter, the term—
‘‘(1) ‘debtor’ means an entity that is the subject
of a foreign proceeding;
‘‘(2) ‘establishment’ means any place of oper-
ations where the debtor carries out a nontransitory
economic activity;
‘‘(3) ‘foreign court’ means a judicial or other
authority competent to control or supervise a foreign
proceeding;
194
‘‘(4) ‘foreign main proceeding’ means a foreign
proceeding taking place in the country where the
debtor has the center of its main interests;
‘‘(5) ‘foreign nonmain proceeding’ means a for-
eign proceeding, other than a foreign main proceed-
ing, taking place in a country where the debtor has
an establishment;
‘‘(6) ‘trustee’ includes a trustee, a debtor in
possession in a case under any chapter of this title,
or a debtor under chapter 9 of this title; and
‘‘(7) ‘within the territorial jurisdiction of the
United States’ when used with reference to property
of a debtor refers to tangible property located within
the territory of the United States and intangible
property deemed under applicable nonbankruptcy
law to be located within that territory, including any
property subject to attachment or garnishment that
may properly be seized or garnished by an action in
a Federal or State court in the United States.
‘‘§ 1503. International obligations of the United States
‘‘To the extent that this chapter conflicts with an ob-
ligation of the United States arising out of any treaty or
other form of agreement to which it is a party with 1 or
more other countries, the requirements of the treaty or
agreement prevail.
195
‘‘§ 1504. Commencement of ancillary case
‘‘A case under this chapter is commenced by the filing
of a petition for recognition of a foreign proceeding under
section 1515.
‘‘§ 1505. Authorization to act in a foreign country
‘‘A trustee or another entity, including an examiner,
may be authorized by the court to act in a foreign country
on behalf of an estate created under section 541. An entity
authorized to act under this section may act in any way
permitted by the applicable foreign law.
‘‘§ 1506. Public policy exception
‘‘Nothing in this chapter prevents the court from re-
fusing to take an action governed by this chapter if the
action would be manifestly contrary to the public policy
of the United States.
‘‘§ 1507. Additional assistance
‘‘(a) Subject to the specific limitations stated else-
where in this chapter the court, upon recognition of a for-
eign proceeding, to provide additional assistance to a for-
eign representative under this title or under other laws
of the United States.
‘‘(b) In determining whether to provide additional as-
sistance under this title or under other laws of the United
States, the court shall consider whether such additional
assistance, consistent with the principles of comity, will
reasonably assure—
196
‘‘(1) just treatment of all holders of claims
against or interests in the debtor’s property;
‘‘(2) protection of claim holders in the United
States against prejudice and inconvenience in the
processing of claims in such foreign proceeding;
‘‘(3) prevention of preferential or fraudulent
dispositions of property of the debtor;
‘‘(4) distribution of proceeds of the debtor’s
property substantially in accordance with the order
prescribed by this title; and
‘‘(5) if appropriate, the provision of an oppor-
tunity for a fresh start for the individual that such
foreign proceeding concerns.
‘‘§ 1508. Interpretation
‘‘In interpreting this chapter, the court shall consider
its international origin, and the need to promote an appli-
cation of this chapter that is consistent with the applica-
tion of similar statutes adopted by foreign jurisdictions.
‘‘SUBCHAPTER II—ACCESS OF FOREIGN REP-
RESENTATIVES AND CREDITORS TO THE
COURT
‘‘§ 1509. Right of direct access
‘‘(a) A foreign representative is entitled to commence
a case under section 1504 by filing a petition for recogni-
tion under section 1515, and upon recognition, to apply
197
directly to other Federal and State courts for appropriate
relief in those courts.
‘‘(b) Upon recognition, and subject to section 1510,
a foreign representative has the capacity to sue and be
sued, and shall be subject to the laws of the United States
of general applicability.
‘‘(c) Subject to section 1510 of this title, a foreign
representative is subject to laws of general application.
‘‘(d) Recognition under this chapter is prerequisite to
the granting of comity or cooperation to a foreign rep-
resentative in any State or Federal court in the United
States. Any request for comity or cooperation by a foreign
representative in any court shall be accompanied by a
sworn statement setting forth whether recognition under
section 1515 has been sought and the status of any such
petition.
‘‘(e) Upon denial of recognition under this chapter,
the court may issue appropriate orders necessary to pre-
vent an attempt to obtain comity or cooperation from
courts in the United States without such recognition.
‘‘§ 1510. Limited jurisdiction
‘‘The sole fact that a foreign representative files a
petition under section 1515 does not subject the foreign
representative to the jurisdiction of any court in the
United States for any other purpose.
198
‘‘§ 1511. Commencement of case under section 301 or
303
‘‘(a) Upon recognition, a foreign representative may
commence—
‘‘(1) an involuntary case under section 303; or
‘‘(2) a voluntary case under section 301 or 302,
if the foreign proceeding is a foreign main proceed-
ing.
‘‘(b) The petition commencing a case under sub-
section (a) must be accompanied by a statement describ-
ing the petition for recognition and its current status. The
court where the petition for recognition has been filed
must be advised of the foreign representative’s intent to
commence a case under subsection (a) prior to such com-
mencement.
‘‘§ 1512. Participation of a foreign representative in a
case under this title
‘‘Upon recognition of a foreign proceeding, the for-
eign representative in that proceeding is entitled to par-
ticipate as a party in interest in a case regarding the debt-
or under this title.
‘‘§ 1513. Access of foreign creditors to a case under
this title
‘‘(a) Foreign creditors have the same rights regarding
the commencement of, and participation in, a case under
this title as domestic creditors.
199
‘‘(b)(1) Subsection (a) does not change or codify
present law as to the priority of claims under section 507
or 726 of this title, except that the claim of a foreign cred-
itor under those sections shall not be given a lower priority
than that of general unsecured claims without priority
solely because the holder of such claim is a foreign credi-
tor.
‘‘(2)(A) Subsection (a) and paragraph (1) do not
change or codify present law as to the allowability of for-
eign revenue claims or other foreign public law claims in
a proceeding under this title.
‘‘(B) Allowance and priority as to a foreign tax claim
or other foreign public law claim shall be governed by any
applicable tax treaty of the United States, under the con-
ditions and circumstances specified therein.
‘‘§ 1514. Notification to foreign creditors concerning a
case under this title
‘‘(a) Whenever in a case under this title notice is to
be given to creditors generally or to any class or category
of creditors, such notice shall also be given to the known
creditors generally, or to creditors in the notified class or
category, that do not have addresses in the United States.
The court may order that appropriate steps be taken with
a view to notifying any creditor whose address is not yet
known.
200
‘‘(b) Such notification to creditors with foreign ad-
dresses described in subsection (a) shall be given individ-
ually, unless the court considers that, under the cir-
cumstances, some other form of notification would be
more appropriate. No letters rogatory or other similar for-
mality is required.
‘‘(c) When a notification of commencement of a case
is to be given to foreign creditors, the notification shall—
‘‘(1) indicate the time period for filing proofs of
claim and specify the place for their filing;
‘‘(2) indicate whether secured creditors need to
file their proofs of claim; and
‘‘(3) contain any other information required to
be included in such a notification to creditors pursu-
ant to this title and the orders of the court.
‘‘(d) Any rule of procedure or order of the court as
to notice or the filing of a claim shall provide such addi-
tional time to creditors with foreign addresses as is rea-
sonable under the circumstances.
‘‘SUBCHAPTER III—RECOGNITION OF A
FOREIGN PROCEEDING AND RELIEF
‘‘§ 1515. Application for recognition of a foreign pro-
ceeding
‘‘(a) A foreign representative applies to the court for
recognition of the foreign proceeding in which the foreign
201
representative has been appointed by filing a petition for
recognition.
‘‘(b) A petition for recognition shall be accompanied
by—
‘‘(1) a certified copy of the decision commenc-
ing the foreign proceeding and appointing the for-
eign representative;
‘‘(2) a certificate from the foreign court affirm-
ing the existence of the foreign proceeding and of
the appointment of the foreign representative; or
‘‘(3) in the absence of evidence referred to in
paragraphs (1) and (2), any other evidence accept-
able to the court of the existence of the foreign pro-
ceeding and of the appointment of the foreign rep-
resentative.
‘‘(c) A petition for recognition shall also be accom-
panied by a statement identifying all foreign proceedings
with respect to the debtor that are known to the foreign
representative.
‘‘(d) The documents referred to in paragraphs (1)
and (2) of subsection (b) must be translated into English.
The court may require a translation into English of addi-
tional documents.
202
‘‘§ 1516. Presumptions concerning recognition
‘‘(a) If the decision or certificate referred to in section
1515(b) indicates that the foreign proceeding is a foreign
proceeding as defined in section 101 and that the person
or body is a foreign representative as defined in section
101, the court is entitled to so presume.
‘‘(b) The court is entitled to presume that documents
submitted in support of the petition for recognition are
authentic, whether or not they have been legalized.
‘‘(c) In the absence of evidence to the contrary, the
debtor’s registered office, or habitual residence in the case
of an individual, is presumed to be the center of the debt-
or’s main interests.
‘‘§ 1517. Order recognizing a foreign proceeding
‘‘(a) Subject to section 1506, after notice and a hear-
ing an order recognizing a foreign proceeding shall be en-
tered if—
‘‘(1) the foreign proceeding is a foreign main
proceeding or foreign nonmain proceeding within the
meaning of section 1502;
‘‘(2) the foreign representative applying for rec-
ognition is a person or body as defined in section
101; and
‘‘(3) the petition meets the requirements of sec-
tion 1515.
‘‘(b) The foreign proceeding shall be recognized—
203
‘‘(1) as a foreign main proceeding if it is taking
place in the country where the debtor has the center
of its main interests; or
‘‘(2) as a foreign nonmain proceeding if the
debtor has an establishment within the meaning of
section 1502 in the foreign country where the pro-
ceeding is pending.
‘‘(c) A petition for recognition of a foreign proceeding
shall be decided upon at the earliest possible time. Entry
of an order recognizing a foreign proceeding shall con-
stitute recognition under this chapter.
‘‘(d) The provisions of this subchapter do not prevent
modification or termination of recognition if it is shown
that the grounds for granting it were fully or partially
lacking or have ceased to exist, but in considering such
action the court shall give due weight to possible prejudice
to parties that have relied upon the granting of recogni-
tion. The case under this chapter may be closed in the
manner prescribed for a case under section 350.
‘‘§ 1518. Subsequent information
‘‘From the time of filing the petition for recognition
of the foreign proceeding, the foreign representative shall
file with the court promptly a notice of change of status
concerning—
204
‘‘(1) any substantial change in the status of the
foreign proceeding or the status of the foreign rep-
resentative’s appointment; and
‘‘(2) any other foreign proceeding regarding the
debtor that becomes known to the foreign represent-
ative.
‘‘§ 1519. Relief that may be granted upon petition for
recognition of a foreign proceeding
‘‘(a) From the time of filing a petition for recognition
until the petition is decided upon, the court may, at the
request of the foreign representative, where relief is ur-
gently needed to protect the assets of the debtor or the
interests of the creditors, grant relief of a provisional na-
ture, including—
‘‘(1) staying execution against the debtor’s as-
sets;
‘‘(2) entrusting the administration or realiza-
tion of all or part of the debtor’s assets located in
the United States to the foreign representative or
another person authorized by the court, including an
examiner, in order to protect and preserve the value
of assets that, by their nature or because of other
circumstances, are perishable, susceptible to devalu-
ation or otherwise in jeopardy; and
205
‘‘(3) any relief referred to in paragraph (3),
(4), or (7) of section 1521(a).
‘‘(b) Unless extended under section 1521(a)(6), the
relief granted under this section terminates when the peti-
tion for recognition is decided upon.
‘‘(c) It is a ground for denial of relief under this sec-
tion that such relief would interfere with the administra-
tion of a foreign main proceeding.
‘‘(d) The court may not enjoin a police or regulatory
act of a governmental unit, including a criminal action or
proceeding, under this section.
‘‘(e) The standards, procedures, and limitations ap-
plicable to an injunction shall apply to relief under this
section.
‘‘§ 1520. Effects of recognition of a foreign main pro-
ceeding
‘‘(a) Upon recognition of a foreign proceeding that
is a foreign main proceeding—
‘‘(1) section 362 applies with respect to the
debtor and that property of the debtor that is within
the territorial jurisdiction of the United States;
‘‘(2) a transfer, an encumbrance, or any other
disposition of an interest of the debtor in property
within the territorial jurisdiction of the United
States is restrained as and to the extent that is pro-
206
vided for property of an estate under sections 363,
549, and 552; and
‘‘(3) unless the court orders otherwise, the for-
eign representative may operate the debtor’s busi-
ness and may exercise the powers of a trustee under
section 549, subject to sections 363 and 552.
‘‘(b) The scope, and the modification or termination,
of the stay and restraints referred to in subsection (a) are
subject to the exceptions and limitations provided in sub-
sections (b), (c), and (d) of section 362, subsections (b)
and (c) of section 363, and sections 552, 555 through 557,
559, and 560.
‘‘(c) Subsection (a) does not affect the right to com-
mence individual actions or proceedings in a foreign coun-
try to the extent necessary to preserve a claim against the
debtor.
‘‘(d) Subsection (a) does not affect the right of a for-
eign representative or an entity to file a petition commenc-
ing a case under this title or the right of any party to
file claims or take other proper actions in such a case.
‘‘§ 1521. Relief that may be granted upon recognition
of a foreign proceeding
‘‘(a) Upon recognition of a foreign proceeding, wheth-
er main or nonmain, where necessary to effectuate the
purpose of this chapter and to protect the assets of the
207
debtor or the interests of the creditors, the court may, at
the request of the foreign representative, grant any appro-
priate relief, including—
‘‘(1) staying the commencement or continuation
of individual actions or individual proceedings con-
cerning the debtor’s assets, rights, obligations or li-
abilities to the extent they have not been stayed
under section 1520(a);
‘‘(2) staying execution against the debtor’s as-
sets to the extent it has not been stayed under sec-
tion 1520(a);
‘‘(3) suspending the right to transfer, encumber
or otherwise dispose of any assets of the debtor to
the extent this right has not been suspended under
section 1520(a);
‘‘(4) providing for the examination of witnesses,
the taking of evidence or the delivery of information
concerning the debtor’s assets, affairs, rights, obliga-
tions or liabilities;
‘‘(5) entrusting the administration or realiza-
tion of all or part of the debtor’s assets within the
territorial jurisdiction of the United States to the
foreign representative or another person, including
an examiner, authorized by the court;
208
‘‘(6) extending relief granted under section
1519(a); and
‘‘(7) granting any additional relief that may be
available to a trustee, except for relief available
under sections 522, 544, 545, 547, 548, 550, and
724(a).
‘‘(b) Upon recognition of a foreign proceeding, wheth-
er main or nonmain, the court may, at the request of the
foreign representative, entrust the distribution of all or
part of the debtor’s assets located in the United States
to the foreign representative or another person, including
an examiner, authorized by the court, provided that the
court is satisfied that the interests of creditors in the
United States are sufficiently protected.
‘‘(c) In granting relief under this section to a rep-
resentative of a foreign nonmain proceeding, the court
must be satisfied that the relief relates to assets that,
under the law of the United States, should be adminis-
tered in the foreign nonmain proceeding or concerns infor-
mation required in that proceeding.
‘‘(d) The court may not enjoin a police or regulatory
act of a governmental unit, including a criminal action or
proceeding, under this section.
209
‘‘(e) The standards, procedures, and limitations ap-
plicable to an injunction shall apply to relief under para-
graphs (1), (2), (3), and (6) of subsection (a).
‘‘§ 1522. Protection of creditors and other interested
persons
‘‘(a) The court may grant relief under section 1519
or 1521, or may modify or terminate relief under sub-
section (c), only if the interests of the creditors and other
interested entities, including the debtor, are sufficiently
protected.
‘‘(b) The court may subject relief granted under sec-
tion 1519 or 1521, or the operation of the debtor’s busi-
ness under section 1520(a)(2) of this title, to conditions
it considers appropriate, including the giving of security
or the filing of a bond.
‘‘(c) The court may, at the request of the foreign rep-
resentative or an entity affected by relief granted under
section 1519 or 1521, or at its own motion, modify or
terminate such relief.
‘‘(d) Section 1104(d) shall apply to the appointment
of an examiner under this chapter. Any examiner shall
comply with the qualification requirements imposed on a
trustee by section 322.
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‘‘§ 1523. Actions to avoid acts detrimental to creditors
‘‘(a) Upon recognition of a foreign proceeding, the
foreign representative has standing in a case concerning
the debtor pending under another chapter of this title to
initiate actions under sections 522, 544, 545, 547, 548,
550, and 724(a).
‘‘(b) When the foreign proceeding is a foreign
nonmain proceeding, the court must be satisfied that an
action under subsection (a) relates to assets that, under
United States law, should be administered in the foreign
nonmain proceeding.
‘‘§ 1524. Intervention by a foreign representative
‘‘Upon recognition of a foreign proceeding, the for-
eign representative may intervene in any proceedings in
a State or Federal court in the United States in which
the debtor is a party.
‘‘SUBCHAPTER IV—COOPERATION WITH FOR-
EIGN COURTS AND FOREIGN REPRESENTA-
TIVES
‘‘§ 1525. Cooperation and direct communication be-
tween the court and foreign courts or for-
eign representatives
‘‘(a) Consistent with section 1501, the court shall co-
operate to the maximum extent possible with foreign
courts or foreign representatives, either directly or
through the trustee.
211
‘‘(b) The court is entitled to communicate directly
with, or to request information or assistance directly from,
foreign courts or foreign representatives, subject to the
rights of parties in interest to notice and participation.
‘‘§ 1526. Cooperation and direct communication be-
tween the trustee and foreign courts or
foreign representatives
‘‘(a) Consistent with section 1501, the trustee or
other person, including an examiner, authorized by the
court, shall, subject to the supervision of the court, cooper-
ate to the maximum extent possible with foreign courts
or foreign representatives.
‘‘(b) The trustee or other person, including an exam-
iner, authorized by the court is entitled, subject to the su-
pervision of the court, to communicate directly with for-
eign courts or foreign representatives.
‘‘§ 1527. Forms of cooperation
‘‘Cooperation referred to in sections 1525 and 1526
may be implemented by any appropriate means,
including—
‘‘(1) appointment of a person or body, including
an examiner, to act at the direction of the court;
‘‘(2) communication of information by any
means considered appropriate by the court;
212
‘‘(3) coordination of the administration and su-
pervision of the debtor’s assets and affairs;
‘‘(4) approval or implementation of agreements
concerning the coordination of proceedings; and
‘‘(5) coordination of concurrent proceedings re-
garding the same debtor.
‘‘SUBCHAPTER V—CONCURRENT PROCEEDINGS
‘‘§ 1528. Commencement of a case under this title
after recognition of a foreign main pro-
ceeding
‘‘After recognition of a foreign main proceeding, a
case under another chapter of this title may be commenced
only if the debtor has assets in the United States. The
effects of such case shall be restricted to the assets of the
debtor that are within the territorial jurisdiction of the
United States and, to the extent necessary to implement
cooperation and coordination under sections 1525, 1526,
and 1527, to other assets of the debtor that are within
the jurisdiction of the court under sections 541(a) of this
title, and 1334(e) of title 28, to the extent that such other
assets are not subject to the jurisdiction and control of
a foreign proceeding that has been recognized under this
chapter.
213
‘‘§ 1529. Coordination of a case under this title and a
foreign proceeding
‘‘Where a foreign proceeding and a case under an-
other chapter of this title are taking place concurrently
regarding the same debtor, the court shall seek coopera-
tion and coordination under sections 1525, 1526, and
1527, and the following shall apply:
‘‘(1) When the case in the United States is tak-
ing place at the time the petition for recognition of
the foreign proceeding is filed—
‘‘(A) any relief granted under sections
1519 or 1521 must be consistent with the relief
granted in the case in the United States; and
‘‘(B) even if the foreign proceeding is rec-
ognized as a foreign main proceeding, section
1520 does not apply.
‘‘(2) When a case in the United States under
this title commences after recognition, or after the
filing of the petition for recognition, of the foreign
proceeding—
‘‘(A) any relief in effect under sections
1519 or 1521 shall be reviewed by the court
and shall be modified or terminated if inconsist-
ent with the case in the United States; and
‘‘(B) if the foreign proceeding is a foreign
main proceeding, the stay and suspension re-
214
ferred to in section 1520(a) shall be modified or
terminated if inconsistent with the relief grant-
ed in the case in the United States.
‘‘(3) In granting, extending, or modifying relief
granted to a representative of a foreign nonmain
proceeding, the court must be satisfied that the re-
lief relates to assets that, under the law of the
United States, should be administered in the foreign
nonmain proceeding or concerns information re-
quired in that proceeding.
‘‘(4) In achieving cooperation and coordination
under sections 1528 and 1529, the court may grant
any of the relief authorized under section 305.
‘‘§ 1530. Coordination of more than 1 foreign proceed-
ing
‘‘In matters referred to in section 1501, with respect
to more than 1 foreign proceeding regarding the debtor,
the court shall seek cooperation and coordination under
sections 1525, 1526, and 1527, and the following shall
apply:
‘‘(1) Any relief granted under section 1519 or
1521 to a representative of a foreign nonmain pro-
ceeding after recognition of a foreign main proceed-
ing must be consistent with the foreign main pro-
ceeding.
215
‘‘(2) If a foreign main proceeding is recognized
after recognition, or after the filing of a petition for
recognition, of a foreign nonmain proceeding, any
relief in effect under section 1519 or 1521 shall be
reviewed by the court and shall be modified or termi-
nated if inconsistent with the foreign main proceed-
ing.
‘‘(3) If, after recognition of a foreign nonmain
proceeding, another foreign nonmain proceeding is
recognized, the court shall grant, modify, or termi-
nate relief for the purpose of facilitating coordina-
tion of the proceedings.
‘‘§ 1531. Presumption of insolvency based on recogni-
tion of a foreign main proceeding
‘‘In the absence of evidence to the contrary, recogni-
tion of a foreign main proceeding is for the purpose of
commencing a proceeding under section 303, proof that
the debtor is generally not paying its debts as such debts
become due.
‘‘§ 1532. Rule of payment in concurrent proceedings
‘‘Without prejudice to secured claims or rights in
rem, a creditor who has received payment with respect to
its claim in a foreign proceeding pursuant to a law relating
to insolvency may not receive a payment for the same
claim in a case under any other chapter of this title re-
216
garding the debtor, so long as the payment to other credi-
tors of the same class is proportionately less than the pay-
ment the creditor has already received.’’.
(b) CLERICAL AMENDMENT.—The table of chapters
for title 11, United States Code, is amended by inserting
after the item relating to chapter 13 the following:
‘‘15. Ancillary and Other Cross-Border Cases ........................ 1501’’.
SEC. 902. AMENDMENTS TO OTHER CHAPTERS IN TITLE 11,
UNITED STATES CODE.
(a) APPLICABILITY OF CHAPTERS.—Section 103 of
title 11, United States Code, is amended—
(1) in subsection (a), by inserting before the pe-
riod the following: ‘‘, and this chapter, sections 307,
304, 555 through 557, 559, and 560 apply in a case
under chapter 15’’; and
(2) by adding at the end the following:
‘‘(j) Chapter 15 applies only in a case under such
chapter, except that—
‘‘(1) sections 1513 and 1514 apply in all cases
under this title; and
‘‘(2) section 1505 applies to trustees and to any
other entity (including an examiner) authorized by
the court under chapters 7, 11, and 12, to debtors
in possession under chapters 11 and 12, and to
debtors under chapter 9 who are authorized to act
under section 1505.’’.
217
(b) DEFINITIONS.—Paragraphs (23) and (24) of title
11, United States Code, are amended to read as follows:
‘‘(23) ‘foreign proceeding’ means a collective ju-
dicial or administrative proceeding in a foreign coun-
try, including an interim proceeding, pursuant to a
law relating to insolvency in which proceeding the
assets and affairs of the debtor are subject to con-
trol or supervision by a foreign court, for the pur-
pose of reorganization or liquidation;
‘‘(24) ‘foreign representative’ means a person
or body, including a person or body appointed on an
interim basis, authorized in a foreign proceeding to
administer the reorganization or the liquidation of
the debtor’s assets or affairs or to act as a rep-
resentative of the foreign proceeding;’’.
(c) AMENDMENTS TO TITLE 28, UNITED STATES
CODE.—
(1) PROCEDURES.—Section 157(b)(2) of title
28, United States Code, is amended—
(A) in subparagraph (N), by striking
‘‘and’’ at the end;
(B) in subparagraph (O), by striking the
period at the end and inserting ‘‘; and’’; and
(C) by adding at the end the following:
218
‘‘(P) recognition of foreign proceedings and
other matters under chapter 15 of title 11.’’.
(2) BANKRUPTCY CASES AND PROCEEDINGS.—
Section 1334(c)(1) of title 28, United States Code,
is amended by striking ‘‘Nothing in’’ and inserting
‘‘Except with respect to a case under chapter 15 of
title 11, nothing in’’.
(3) DUTIES OF TRUSTEES.—Section 586(a)(3)
of title 28, United States Code, is amended by in-
serting ‘‘15,’’ after ‘‘chapter’’.
TITLE X—FINANCIAL CONTRACT
PROVISIONS
SEC. 1001. TREATMENT OF CERTAIN AGREEMENTS BY CON-
SERVATORS OR RECEIVERS OF INSURED DE-
POSITORY INSTITUTIONS.
(a) DEFINITION
OF QUALIFIED FINANCIAL CON-
TRACT.—Section 11(e)(8)(D)(i) of the Federal Deposit In-
surance Act (12 U.S.C. 1821(e)(8)(D)(i)) is amended by
inserting ‘‘, resolution or order’’ after ‘‘any similar agree-
ment that the Corporation determines by regulation’’.
(b) DEFINITION OF SECURITIES CONTRACT.—Sec-
tion 11(e)(8)(D)(ii) of the Federal Deposit Insurance Act
(12 U.S.C. 1821(e)(8)(D)(ii)) is amended to read as fol-
lows:
219
‘‘(ii) SECURITIES
CONTRACT.—The
term ‘securities contract’—
‘‘(I) means a contract for the
purchase, sale, or loan of a security, a
certificate of deposit, a mortgage loan,
or any interest in a mortgage loan, a
group or index of securities, certifi-
cates of deposit, or mortgage loans or
interests therein (including any inter-
est therein or based on the value
thereof) or any option on any of the
foregoing, including any option to
purchase or sell any such security,
certificate of deposit, loan, interest,
group or index, or option;
‘‘(II) does not include any pur-
chase, sale, or repurchase obligation
under a participation in a commercial
mortgage loan unless the Corporation
determines by regulation, resolution,
or order to include any such agree-
ment within the meaning of such
term;
220
‘‘(III) means any option entered
into on a national securities exchange
relating to foreign currencies;
‘‘(IV) means the guarantee by or
to any securities clearing agency of
any settlement of cash, securities, cer-
tificates of deposit, mortgage loans or
interests therein, group or index of se-
curities, certificates of deposit, or
mortgage loans or interests therein
(including any interest therein or
based on the value thereof) or option
on any of the foregoing, including any
option to purchase or sell any such se-
curity, certificate of deposit, loan, in-
terest, group or index or option;
‘‘(V) means any margin loan;
‘‘(VI) means any other agree-
ment or transaction that is similar to
any agreement or transaction referred
to in this clause;
‘‘(VII) means any combination of
the agreements or transactions re-
ferred to in this clause;
221
‘‘(VIII) means any option to
enter into any agreement or trans-
action referred to in this clause;
‘‘(IX) means a master agreement
that provides for an agreement or
transaction referred to in subclause
(I), (III), (IV), (V), (VI), (VII), or
(VIII), together with all supplements
to any such master agreement, with-
out regard to whether the master
agreement provides for an agreement
or transaction that is not a securities
contract under this clause, except that
the master agreement shall be consid-
ered to be a securities contract under
this clause only with respect to each
agreement or transaction under the
master agreement that is referred to
in subclause (I), (III), (IV), (V), (VI),
(VII), or (VIII); and
‘‘(X) means any security agree-
ment or arrangement or other credit
enhancement related to any agree-
ment or transaction referred to in this
clause.’’.