Droit des affaires - Insolvabilité des États et dettes souveraines -1 - 125

Les fonds vautours

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After this brief survey of the rapidly changing landscape of sovereign debt litigation, it is now time to review the actions undertaken at various levels to curtail the activities of sovereign debt creditors.

§ 2. – Sovereign debtors ﬁght back: targeting the “vultures”
In recent years the activities of sovereign debt creditors have attracted much attention. The radical changes in the structure of sovereign debt holding has made it more difﬁcult to restructure such debt in case of difﬁculty. Further, it seems that sovereign debt litigation is on the rise. As a result, various calls have been made to curtail the freedom of individual bondholders and creditors of sovereign. Some of these initiatives aimed at the rights and actions of individual creditors in general, without distinguishing between various categories of investors. As on previous occasions where sovereign debt was discussed, 78 a ﬁrst initiative suggested the creation of an institutional mechanism to deal with sovereign debt restructuring, which would achieve something close to corporate debt restructuring. As is well known, the idea of creating an international mechanism for restructuring sovereign debt launched by Ms Kruger, did not produce any results. 79 The other avenue proved more fruitful: instead of creating an international ’tribunal’ for sovereign debt disputes, many States have followed the idea of adapting the contractual documentation in their sovereign issues to facilitate restructuring. The introduction of collective action clauses in the legal documentation of sovereign bond issues has been extensively documented and discussed. 80 Our focus is on initiatives of another nature, which aim speciﬁcally at creditors deemed to be less worthy of protection, often referred to as ’vulture funds’.
78. It has been reported that even Adam Smith had indicated the need to create a bankruptcy regime for States analogous to that applicable to corporate debtors – see the references in J. I. BLACKMAN and R. MUKHI, “The Evolution of Modern Sovereign Debt Litigation: Vultures, Alter Egos and Other Legal Fauna”, Law & Contemp. Problems, 2010, vol. 73, (47), 48, note 6. On the evolution of ideas in this ﬁeld, see K. ROGOFF and J. ZETTELMEYER, “Bankruptcy Procedures for Sovereigns: A History of Ideas 1976-2001”, IMF Staff Papers, vol. 49/3, 2002. 79. See A. O. KRUGER, “A New Approach to Sovereign Debt Restructuring Process”, IMF, April 2002 and IMF, The Design of the Sovereign Debt Restructuring Mechanism – Further Considerations, Nov. 2002. The IMF had undertaken work on the topic well before 2002, see in particular its ’Note on an International Debt Adjustment Facility for Sovereign Debtors’, EBS/95/90, May 1995 and the paper ’Orderly and Effective Insolvency Procedures, Key issues’, 1999. See on this initiative ad generalia M. DABROWSKI, A. FISCH, K. GABRIEL and C. LIENKAMP (eds.), Die Diskussion um ein Insolvenzrecht für Staaten. Bewertungen eines Lösungsvorschlages zur Überwindung der Internationalen Schuldenkrise, 2003, Duncker & Humblot, 303 p. and CH. PAULUS, “Some Thoughts on an Insolvency Procedure for Countries, Am. J. Comp. L. 2002, vol. 50, 531 ff. and S. HAGAN, “Designing a Legal Framework to Restructure Sovereign Debt”, Georgetown J. Intl. L., 2005, vol. 36, 299 ff. 80. See hereinafter Part II – Section 1 for more details.

Droit des affaires - Insolvabilité des États et dettes souveraines -1

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