The co-ordination of cross-border bank insolvency

Abstract

The question to be answered in this dissertation is whether the same principles contained in the Dodd-Frank Act can be implemented in South Africa in order to develop an effective cross-border bank insolvency regime. The answer to the above mentioned question is twofold, firstly an understanding of what is meant by the terms cross-border insolvency is required and secondly it is important to understand why there is a need for a uniform cross-border insolvency regime. After the economic crises in 2007, specifically after the collapse of Lehman Brothers, the US determined that their current bankruptcy procedures are insufficient to adequately resolve a matter of cross-border bank insolvency. As such the US developed and implemented the Dodd-Frank Act. The Dodd-Frank Act contains specific provisions that will provide legal certainty when a matter of cross-border bank insolvency occurs, specifically relating to the determination of jurisdiction as well as how falling banks should be administered. These provisions will critically be examined in order to establish if similar provisions can be implemented in South Africa. The rationale for such implementation is to strengthen international trade not only within the SADC region but across the globe.