Collective Action Clauses In International Sovereign Bond Contracts - Whence The Opposition?
AbstractIn the debate on strengthening the international financial architecture, which peaked in 2002 after a series of emerging market sovereign debt crises, the universal adoption of collective action clauses (CACs) was the most promising reform proposal. Academics and the official sector had been promoting CACs at least since 1995, yet market practice did not begin to change until 2003. This delay is often attributed to the opposition of investors and sovereign borrowers to CACs. This paper evaluates the publicly stated as well as the suspected private motives of the two sides to block the proliferation of CACs. It draws on a wide range of existing evidence and adds some new theoretical considerations to show that there is no reason to be sceptical of CACs unless bailouts exist as an alternative crisis resolution mechanism. This conclusion may be of interest purely for the sake of historical accuracy. But more importantly, it may help to better understand any potential future resistance by market participants, for example in the process of introducing CACs in bonds governed by German law. Copyright � 2009 Blackwell Publishing Ltd.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Wiley Blackwell in its journal Journal of Economic Surveys.
Volume (Year): 23 (2009)
Issue (Month): 5 (December)
Contact details of provider:
Web page: http://www.blackwellpublishing.com/journal.asp?ref=0950-0804
Other versions of this item:
- Häseler, Sönke, 2007. "Collective Action Clauses in International Sovereign Bond Contracts - Whence the Opposition?," MPRA Paper 6314, University Library of Munich, Germany.
- K3 - Law and Economics - - Other Substantive Areas of Law
- F3 - International Economics - - International Finance
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Eger, Thomas, 2011. "Solidarität und Wettbewerb in der Europäischen Union in Zeiten der Finanz- und Verschuldungskrise," Discussion Papers 1/11, Europa-Kolleg Hamburg, Institute for European Integration.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing) or (Christopher F. Baum).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.