A Critique of Debt Collection Systems in Foreign Jurisdictions and Best Practices
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Abstract
Resolving insolvency is one of the primary indicators, as developed by the World Bank in the Doing Business report, to measure how the ease of doing business in each country worldwide. According to the report, the willingness of banks and investors to support new business depends a great deal on rules that govern failing business. As of 2016, Thailand’s is ranked 23rd in the world in term of resolving insolvency. Its recovery rate (cents on the dollar) is stood at 67.7 percent, which is a relatively low when compared to other countries, such as the United States, England, Japan and Malaysia. Recovery rates and capability of receivers to collect assets of debtors are at the heart of effective insolvency regimes, and cannot be considered in isolation from it.
This article involves a study of bankruptcy systems in other countries, including United States, United Kingdom, Japan and Malaysia, as well as examining the World Bank’s report, so-called “Doing Business” which ranks countries for investment from their information on easement and difficulties in doing business, including resolving insolvency.
It also considers the UNCITRAL’s model law on insolvency and bankruptcy system. Nonetheless, it is observed that both of World Bank and the UNCITRAL do not address
a detailed explanation of procedure for bankruptcy enforcement.
It is concluded that US, UK, Japan and Malaysia are ranked higher than that of Thailand in term of resolving insolvency. One thing in common among those countries; their bankruptcy systems have coherent and workable procedures. Specifically, in those countries, a system for searching and tracking information on assets of an individual are available. These also include a system that links all information among public and private entities through the application of social security number. In addition to that, U.S. and Japan cases are interesting as they assess for IP valuation in order to enforce the bankrupt apart from the sale by auction.
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Published Manuscripts are the copyright of the Journal of the Justice System. However; the opinions that appeared in the content are the sole responsibility of the author.
References
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