11 U.S.C. § 1502 — Definitions

Page 325 TITLE 11—BANKRUPTCY § 1502 Sec. SUBCHAPTER III—RECOGNITION OF A FOREIGN PROCEEDING AND RELIEF 1515. Application for recognition. 1516. Presumptions concerning recognition. 1517. Order granting recognition. 1518. Subsequent information. 1519. Relief that may be granted upon filing peti- tion for recognition. 1520. Effects of recognition of a foreign main pro- ceeding. 1521. Relief that may be granted upon recognition. 1522. Protection of creditors and other interested persons. 1523. Actions to avoid acts detrimental to credi- tors. 1524. Intervention by a foreign representative. SUBCHAPTER IV—COOPERATION WITH FOREIGN COURTS AND FOREIGN REPRESENTATIVES 1525. Cooperation and direct communication be- tween the court and foreign courts or for- eign representatives. 1526. Cooperation and direct communication be- tween the trustee and foreign courts or for- eign representatives. 1527. Forms of cooperation. SUBCHAPTER V—CONCURRENT PROCEEDINGS 1528. Commencement of a case under this title after recognition of a foreign main pro- ceeding. 1529. Coordination of a case under this title and a foreign proceeding. 1530. Coordination of more than 1 foreign pro- ceeding. 1531. Presumption of insolvency based on recogni- tion of a foreign main proceeding. 1532. Rule of payment in concurrent proceedings. Editorial Notes PRIOR PROVISIONS A prior chapter 15, consisting of sections 1501 to 151326, related to a pilot program for a United States trustee system, prior to repeal by Pub. L. 99–554, title II, § 231, Oct. 27, 1986, 100 Stat. 3103. § 1501. Purpose and scope of application (a) The purpose of this chapter is to incor- porate the Model Law on Cross-Border Insol- vency so as to provide effective mechanisms for dealing with cases of cross-border insolvency with the objectives of— (1) cooperation between— (A) courts of the United States, United States trustees, trustees, examiners, debt- ors, and debtors in possession; and (B) the courts and other competent au- thorities of foreign countries involved in cross-border insolvency cases; (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 invest- ment 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 connection 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 pend- ing 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 proceeding under this title. (c) This chapter does not apply to— (1) a proceeding concerning an entity, other than a foreign insurance company, identified by exclusion in section 109(b); (2) an individual, or to an individual and such individual’s spouse, who have debts with- in 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 of 1970, 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. (d) The court may not grant relief under this chapter with respect to any deposit, escrow, trust fund, or other security required or per- mitted under any applicable State insurance law or regulation for the benefit of claim holders in the United States. (Added Pub. L. 109–8, title VIII, § 801(a), Apr. 20, 2005, 119 Stat. 135.) Editorial Notes REFERENCES IN TEXT The Securities Investor Protection Act of 1970, re- ferred to in subsec. (c)(3), is Pub. L. 91–598, Dec. 30, 1970, 84 Stat. 1636, which is classified generally to chapter 2B–1 (§ 78aaa et seq.) of Title 15, Commerce and Trade. For complete classification of this Act to the Code, see section 78aaa of Title 15 and Tables. PRIOR PROVISIONS A prior section 1501, Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2652, related to applicability of chapter which pro- vided a pilot program for a United States trustee sys- tem, prior to repeal by Pub. L. 99–554, title II, § 231, Oct. 27, 1986, 100 Stat. 3103. Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as an Effective Date of 2005 Amendment note under section 101 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 sub- ject of a foreign proceeding; (2) ‘‘establishment’’ means any place of oper- ations where the debtor carries out a non- transitory economic activity; (3) ‘‘foreign court’’ means a judicial or other authority competent to control or supervise a foreign proceeding; Page 326 TITLE 11—BANKRUPTCY § 1503 (4) ‘‘foreign main proceeding’’ means a for- eign proceeding pending in the country where the debtor has the center of its main interests; (5) ‘‘foreign nonmain proceeding’’ means a foreign proceeding, other than a foreign main proceeding, pending 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; (7) ‘‘recognition’’ means the entry of an order granting recognition of a foreign main proceeding or foreign nonmain proceeding under this chapter; and (8) ‘‘within the territorial jurisdiction of the United States’’, when used with reference to property of a debtor, refers to tangible prop- erty 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 ac- tion in a Federal or State court in the United States. (Added Pub. L. 109–8, title VIII, § 801(a), Apr. 20, 2005, 119 Stat. 135.) Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as an Effective Date of 2005 Amendment note under section 101 of this title. § 1503. International obligations of the United States To the extent that this chapter conflicts with an obligation of the United States arising out of any treaty or other form of agreement to which it is a party with one or more other countries, the requirements of the treaty or agreement prevail. (Added Pub. L. 109–8, title VIII, § 801(a), Apr. 20, 2005, 119 Stat. 136.) Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as an Effective Date of 2005 Amendment note under section 101 of this title. § 1504. Commencement of ancillary case A case under this chapter is commenced by the filing of a petition for recognition of a for- eign proceeding under section 1515. (Added Pub. L. 109–8, title VIII, § 801(a), Apr. 20, 2005, 119 Stat. 136.) Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as an Effective Date of 2005 Amendment note under section 101 of this title. § 1505. Authorization to act in a foreign country A trustee or another entity (including an ex- aminer) may be authorized by the court to act in a foreign country on behalf of an estate cre- ated under section 541. An entity authorized to act under this section may act in any way per- mitted by the applicable foreign law. (Added Pub. L. 109–8, title VIII, § 801(a), Apr. 20, 2005, 119 Stat. 136.) Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as an Effective Date of 2005 Amendment note under section 101 of this title. § 1506. Public policy exception Nothing in this chapter prevents the court from refusing to take an action governed by this chapter if the action would be manifestly con- trary to the public policy of the United States. (Added Pub. L. 109–8, title VIII, § 801(a), Apr. 20, 2005, 119 Stat. 136.) Statutory Notes and Related Subsidiaries EFFECTIVE DATE Section effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as an Effective Date of 2005 Amendment note under section 101 of this title. § 1507. Additional assistance (a) Subject to the specific limitations stated elsewhere in this chapter the court, if recogni- tion is granted, may provide additional assist- ance to a foreign representative under this title or under other laws of the United States. (b) In determining whether to provide addi- tional assistance under this title or under other laws of the United States, the court shall con- sider whether such additional assistance, con- sistent with the principles of comity, will rea- sonably assure— (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 pro- ceeding; (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. (Added Pub. L. 109–8, title VIII, § 801(a), Apr. 20, 2005, 119 Stat. 136.)