A popular perception is that administrative receivers and their appointors hold 'too much' power in relation to troubled companies. Consideration of this issue is timely, because insolvency law is currently under review. We argue although the law's formal structure is imbalanced, this can nevertheless generate savings for parties by allowing a concentrated creditor who has invested in information-gathering about the debtor to conduct a private insolvency procedure. We suggest that this procedure is likely to be more efficient than one conducted by a state official, and that it facilitates debt-based governance, a matter of particular importance for small and medium-sized businesses.
|Date of creation:||Mar 2000|
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