Mechanism of the cross-border insolvency regulation in the European Union. Theory and Practical problems

Abstract

Mechanism of the insolvency legal regulation is a complex of rules of substantive and procedure laws settling the main principles of legal regulation of the relations arising in connection with the debtors’ insolvency. Practical application of any particular principles of legal regulation of these relations constitutes the legal regulation model of cross-boarder insolvency. A model of the primary and secondary cross-border insolvency proceedings has been created at European Union level. It does not take the place of national models of legal regulations of the above relations, but allows them to interact on the basis of the unified conflict norms and legal base for recognition and execution of foreign judicial decisions rendered in insolvency proceedings. Though the model does not provide the final settlement of the problem of creating unified mechanism of the cross-border insolvency legal regulation in the EU countries, it nevertheless indicates the readiness of the membercountries to renounce the supremacy of the principle of the state sovereignty in order to regulate the cross-border insolvency and to create the Common Economic Space. It is safe to say that the tendency to work out the mechanism of the legal regulation of the cross-border insolvency based on the principles of the unity and universality of the insolvency proceedings may be clearly traced within the European Union.