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The EU Incremental Approach to Cross-Border Insolvency: From the Istanbul Convention to the Proposal for a Directive

Emilie Ghio

Since the 2008 global economic and financial crisis, cross-border insolvency filings have been on the rise, reviving the debate as to the best initiatives to create an efficient European insolvency regime. Even though it has widely been accepted in academic literature that harmonisation is preferable, it is now also internationally acknowledged that it is an unreasonable objective in the foreseeable future. The European institutions in particular have long recognised the limits beyond which the sovereign Member States are not willing to go at the present stage of European integration and the debate has shifted from the traditional universal versus territorialism divide towards a more feasible approach to cross-border insolvency: pragmatism and incrementalism. Through the analysis of different recent European instruments, this paper argues the harmonisation of cross-border insolvency law is a continuum and the incremental approach to implementing and reforming EU insolvency law should be commended. This paper concludes that the time is ripe for radical changes to the theoretical framework within which we evaluate the implementation of European cross-border insolvency law. This research acknowledges theories describing pragmatism as a political approach – focusing on the process rather than the result - thus complementing incrementalism.

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