Elaine Moore writes in the FT that the idea of an international bankruptcy law gains traction, after IMF suggestions in the early 2000s for a “Sovereign Debt Restructuring Mechanism” failed to receive sufficient support. In September, 124 UN General Assembly members supported the proposal to develop a legal framework for restructuring sovereign debt.

This proposal complements the agreement among market participants, international organisations and regulators (against the backdrop of Argentina’s latest default) to change bond clauses with the intention to facilitate renegotiation through binding majority decisions.