Enforcement of Foreign Insolvency Judgments under the Jordanian Insolvency Law of 2018: An Analytical Study

Abstract

Initially, the Hashemite Kingdom of Jordan applied the principle of territoriality in bankruptcy matters, a stance rooted in the principle of sovereignty. It formulated its legal rules in accordance with the demands of the public interest and, as a result, rejected the recognition and enforcement of any foreign bankruptcy judgment unless the foreign state was bound to Jordan by an agreement for the purpose of enforcing such judgments.

However, the imperatives of international judicial cooperation required the legislative framework to be amended to align with the requirements of international commerce. This was achieved by adopting an approach based on the UNCITRAL Model Law on Cross-Border Insolvency for the purpose of enforcing against a debtor's assets scattered across the territories of different countries, thereby protecting the interests of creditors.

Despite the numerous justifications and benefits for adopting specific provisions in the area of enforcing foreign insolvency judgments, this study's core problem lies in evaluating the capacity of the legal provisions within the Jordanian Insolvency Law to achieve the very objective the Jordanian legislator sought to realize. This objective is the desire to build bridges of judicial cooperation with foreign judicial authorities to ensure the effective recognition and enforcement of foreign insolvency judgments, and to determine whether this effectively serves the interests of creditors.

For the purpose of addressing this problem, this study adopted an analytical and comparative approach, with a specific focus on the UNCITRAL Model Law on Cross-Border Insolvency, which sets out provisions for international insolvency. The study reached several conclusions, among which was that the Jordanian legislator has made clear legislative efforts to adopt an integrated framework for international insolvency. However, this approach requires continuous review to keep pace with the rapid developments in the field of cross-border insolvency. The study also put forward a number of recommendations, including the addition of a new paragraph to Article (2) of the Insolvency Law, to read as follows: "In the absence of a debtor's center of main interests in the Kingdom, jurisdiction shall lie with the court in whose territorial jurisdiction any of the debtor's assets are located."