Lawyers with financially distressed clients have long been alive to the potential advantages of forum shopping. At its simplest, forum shopping means little more than identifying the optimal jurisdiction for the restructuring or insolvency of a given company and heading that way. For example, if you foresee potential problems with the Transfer of Undertakings (Protection of Employment) Regulations (TUPE) which might scupper a sale, try the Netherlands; if you need to force through a debt-for-equity swap, the UK may be your best option; if you are advising the employees, head for France.
It was thought that the EC Regulation on Insolvency Proceedings, which came into force on 31 May, 2002, would reduce forum shopping as it sought to establish a framework for determining where a company’s insolvency should be based. While the regulation has had a fairly dramatic impact on the conduct of pan-European insolvencies, forum shopping never quite went out of fashion. One thing has changed though – the language. ‘Migration’ has become the new forum shopping.
