Public Interest in Insolvency Law
Published online by Cambridge University Press: 25 May 2021
Summary
INTRODUCTION
If one thinks about the relationship between public interest and the law, one might not instantly think about insolvency law. One could even cynically argue that insolvency law is “all about the money“. While it is true that matters of insolvency law are usually not concerning “life and death “, or fundamental rights, as argued by M. Potacs in this volume, they can have considerable knock-on effects for a significant number of persons also outside the insolvency context: insolvencies of large corporations or even public entities can have potentially deleterious consequences for employees, contracting parties and whole communities (e.g. mass employment, additional insolvencies, social frictions etc.). But also insolvencies of natural persons have considerable public interest aspects, especially when taking into account the number of private insolvencies and the severe consequences they have on debtors and their families.
The following sections explore the phenomenon of public interest in insolvency law in a systematic manner: first a very brief overview on public interest in general is given (section 2). Then the topic of public interest in insolvency law is examined (section 3). This entails an analysis of the historical roots of modern insolvency law and the public interest(s) that led to its establishment. The authors argue that the primary goal of modern insolvency law was (and, mostly, still is) to foster the (private) interests of the creditors. Particularly in recent decades, however, public interests were introduced into most insolvency codes, thereby trying to balance the private interests of the creditors with broader public interests. The analysis is then deepened by two examples (section 4), namely the discharge of natural persons (micro perspective within insolvency law) and the consideration of public interests on the verge between insolvency and criminal law (macro perspective). Finally, conclusions are drawn concerning the functions of public interest in insolvency law and – hopefully – beyond (section 5).
PUBLIC INTEREST – GENERAL REMARKS
Public interest – as a conceptual counterpart to mere individual or particular interests – refers to the notion of welfare or well-being of society as a whole or at least larger parts of it.
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- Public Interest in Law , pp. 247 - 270Publisher: IntersentiaPrint publication year: 2021