Comparative overview of Asian insolvency reforms in the last decade

History has shown that insolvency laws were developed amid economic turmoil because the magnitude of the insolvent debtors’ unpaid debts acted as the pressure on the development of the insolvency law. Economic crisis let people realise that insolvency law is necessary in addition to normal creditor-debtor relationship laws. The US insolvency law evolved while being enacted, repealed and re-enacted four times during the economic downfalls of the 1800’s.1 Many economies in transition in Central and Eastern Europe must have developed insolvency laws in the 1980’s as they first had insolvent firms which were not seen in the planned economy.2 Latin American countries also reformed their insolvency laws when economies were in such bad shape that sovereign states were on the edge of bankruptcy in the early 1990’s.