Before we offend our fellow law practitioners outside of the United States, we want to emphasize that this blog entry is not about what is “better” – chapter 11 or other bankruptcy laws, U.S. courts or other courts, Coke or Guaraná
. Like soda, local law tends to match local tastes. So in most cases, a business is best off seeking the protection of its home courts when considering an in-court restructuring. Unique circumstances, however, may cause a business to consider other restructuring options, and it may be helpful to know that chapter 11 provides a viable forum for businesses incorporated outside of and (surprisingly) with little or no business activities in the U.S. In this installment of Breaking the Code, we cover the section of the Bankruptcy Code that makes coming to America possible: section 109(a).
Section 109(a) sets forth the basic requirements for commencing a case under the Bankruptcy Code:
(a) Notwithstanding any other provision of this section, only a person that resides or has a domicile, a place of business, or property in the United States, or a municipality, may be a debtor under this title.