Cross‐border insolvency in the <scp>BRICS</scp> nations: A comparative analysis and proposal for a concordat

Abstract There is little doubt that global commerce is the backbone of most national economies. Nonetheless, with trade transcending domestic boundaries and corporations becoming multinational, financial problems tend to become global exponentially. Cross‐border insolvency law attempts to find the middle ground between regulating corporate distress and attracting foreign investment. Still, definitions of how to attain this middle ground are apt to change. This article assesses the existing models for treating cross‐border insolvencies, including the legal and commercial challenges therein, in the absence of uniform or even harmonised mechanisms in the global legal arsenal. This fragmentation ultimately impedes the conduct of insolvency proceedings and serves as a disincentive for investors to trade abroad, especially in regimes with piecemeal, unpredictable, or even unhospitable insolvency frameworks. Using the BRICS bloc as a case study, this article invites the establishment of a regional concordat among the BRICS nations and suggests how the Concordat should regulate cross‐border insolvency in the jurisdictions at stake. As emerging economic and geopolitical powerhouses with diverse legal systems and varying levels of financial integration, BRICS faces unique challenges in addressing cross‐border insolvency. If implemented, the proposed Concordat will not only address the economic and legal challenges specific to BRICS but also position the bloc as a pioneer in developing an alternative insolvency regime adaptable to other emerging market contexts, in turn promoting financial stability, enhancing creditor confidence, and serving as a South–South cooperation model in international economic law.