The Operation of Security Interests in International Insolvencies

Abstract

Canada's Bankruptcy and insolvency Act (BIA) is comprehensive in scope, covering both business and individual insolvencies. Until 1992, however, the BIA was oriented almost entirely toward liquidation proceedings, its re-organization provisions rendered all but dormant by the high level of deference exhibited to the rights of secured creditors. The void was filled by the federal Companies' Creditors Arrangement Act (CCAA). Originally conceived to facilitate the reorganization of major public companies during the economic depression of the 1930s, the CCAA establishes a skeletal framework for arrangements with creditors, leaving the detailed rules and procedures to be supplied by the courts on an ongoing basis as the reorganization proceeds.