Best Let Sleeping Presumptions Lie: Interpretation of “Center of Main Interest” Under Chapter 15 of the Bankruptcy Code and an Appeal for Additional Judicial Complacency

After the 2005 Bankruptcy Abuse Prevention and Consumer Protec-tion Act (BAPCPA) changes to the Bankruptcy Code, debtors undergoing foreign bankruptcy proceedings must show that their bankruptcy is taking place in their “center of main interest” (COMI) in order to receive the fullest cooperation from courts in the United States. This provision was intended to prevent forum shopping and abuse of bankruptcy havens. The Code does not, however, define COMI and so U.S. courts have been forced to develop a common law definition, drawing from international and European antecedents that also use the term.This Note briefly summarizes the statutory provisions enacted as part of BAPCPA and provides background to the challenges of interpret-ing COMI. Then it discusses the few U.S. cases that have squarely ad-dressed the COMI issue. Finding that courts have adopted a broad view of their own powers to investigate and challenge debtors on the location of their COMI, this Note concludes by arguing that courts should gener-ally not use their powers and instead should defer to a bankruptcy venue that both debtor and creditors can agree on.

The full text of this Note is available to download as a PDF.