Arbeitspapier

Interpreting the pari passu clause in sovereign bond contracts: It's all Hebrew (and Aramaic) to me

In this comment, we take a helicopter tour of the history of notions of "equality" and "justice" in sovereign debt restructuring in particular, and in the division of property more generally, and show that these concerns have existed for centuries, if not millennia. We argue that the issue at stake in the interpretation of the pari passu clause is not so much the treatment of holders of identical claims - it is now customary to treat them identically - but whether the holders of different claims should be treated differently. We show that exists a customary "principle of differentiation" that allows creditors with claims that differ in specific ways to be treated preferentially. One of these specific differences concerns debts that have been reduced in value during a previous debt restructuring or default, and based on this principle we conclude that the New York court has, if not completely misinterpreted the meaning of the pari passu clause, then at least misapplied it.

Sprache
Englisch

Erschienen in
Series: Working Paper ; No. 2014-06

Klassifikation
Wirtschaft
Equity, Justice, Inequality, and Other Normative Criteria and Measurement
International Lending and Debt Problems
Contract Law
Thema
sovereign debt restructuring
pari passu
Argentina
inter-creditor equity

Ereignis
Geistige Schöpfung
(wer)
Wright, Mark L. J.
Ereignis
Veröffentlichung
(wer)
Federal Reserve Bank of Chicago
(wo)
Chicago, IL
(wann)
2014

Handle
Letzte Aktualisierung
10.03.2025, 11:42 MEZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Wright, Mark L. J.
  • Federal Reserve Bank of Chicago

Entstanden

  • 2014

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