Institutional Issues and Enhancement of Recognition of Foreign Insolvency Proceedings in China: With Reference to the Australian Model Law Framework
Year: 2026
Type: article
Abstract: The cross-border insolvency issue is becoming critical in the globalized economy, and the recognition system of China under Article 5 of the Enterprise Bankruptcy Law faces a serious institutional problem. In this paper, the author will analyse a recognition regime that is currently practised in China and presents significant obstacles to international cooperation based on rigid reciprocity and treaty requirements. Based on the implementation of the UNCITRAL Model Law that is applied in Australia, the current study establishes four major institutional weaknesses, including restrictive entry requirements that rely on the principle of reciprocity, as opposed to universalism, inadequate procedural and relief predictability, a lack of court cooperation mechanisms, and vague boundaries of the public policy exception. This paper, based on comparative analysis, demonstrates that the framework of the Model Law used in Australia offers predictable recognition pathways based on the concept of centre of main interests (COMI), automatic and discretionary relief measures and structured court cooperation protocols. The paper ends by giving operational recommendations for China, such as legislative amendments to reduce reciprocity barriers, judicial capacity building to determine COMI, setting up court cooperation guidelines, and clarifying the boundaries of the public policy exception to align with international best practices.
Author: Huainan Niu
Institution: UNSW Sydney
Language: English
Subfield: Law
Field: Social Sciences
Domain: Social Sciences
Open Access status: hybrid
OpenAlex ID: W7154024679