Chapter 15 of the Bankruptcy Code,1 the U.S. enacted equivalent of the UNCITRAL Model Law On Cross-Border Insolvencies, has received a fair amount of use by distressed shipping companies since it was enacted in 2005. In 2007, we wrote in these pages that Chapter 15 might provide a welcome U.S. safe harbor. (See “Shipping, Finance, and Insolvencies: A Homeport in the United States?” Mainbrace, June 2007, No. 2). More recently, in 2009, we published “Shipping, Finance, and Insolvencies: The Black Swan Comes Home to Roost” (Mainbrace, January 2009, No.
Recent trade publications have prophesized a wave of shipping bankruptcies. We have already seen several in the United States in 2011, such as Omega and Marco Polo. Trailer Bridge and General Maritime fi led in November. There will undoubtedly be more, despite the potential debtors having little or no connection to the United States. In this respect, non-U.S. listed shipowning companies considering restructuring and reorganization may not factor in the potential for a U.S. main proceeding under Chapter 11 reorganization on the assumption that they do not qualify to be U.S. debtors.