Bankruptcy-Friendly U.S. Extends Lead as Haven of Foreign Filers

There’s still at least one thing Americans do better than anyone else in the world: Corporate bankruptcies, Bloomberg reported. Since 2013, hundreds of foreign businesses have taken advantage of U.S. bankruptcy courts to slash debt and clean up their balance sheets, according to an analysis of legal filings. The reason is simple, lawyers and former judges say: America has the most company-friendly bankruptcy rules in the developed world. “The lawyers and judges know how to move things through the system quickly,” said Prof. Bruce Markell, a law professor at Northwestern University School of Law and a former U.S. bankruptcy judge who consults with the International Monetary Fund on insolvency issues and was the primary drafter of the bankruptcy law used by the country of Kosovo. Latam Airlines, based in Chile, Aeromexico and Colombia’s Avianca Holdings all sought court protection in New York last year, blaming the drop in air travel caused by the coronavirus. They were joined by OneWeb Global, based in London, while two other satellite communications companies filed in different U.S. bankruptcy courts. Last month, Corp Group Banking SA filed for court protection in Wilmington, Del., in part to halt a bondholder lawsuit filed against the bank holding company in its hometown of Santiago, Chile. Read more.