tailieunhanh - SOVEREIGN BONDS AND THE COLLECTIVE WILL Lee C. Buchheit G. Mitu Gulati

As of December 2008, oil and gas operators had provided 3,879 surety and personal bonds, valued at approximately $162 million, to ensure compliance with all lease terms and conditions for 88,357 wells, according to our analysis of BLM data. BLM officials told us that the bond amounts are generally not based on the full reclamation costs for a site that would be incurred by the government if an operator were to fail to complete the required reclamation. Rather, the bond amounts are based on regulatory minimums intended to ensure that the operator complies with all the terms of the lease,. | Working Paper Series SOVEREIGN BONDS AND THE COLLECTIVE WILL Lee C. Buchheit G. Mitu Gulati Georgetown-Sloan Project on Business Institutions Georgetown University Law Center Washington DC DRAFT 03 28 02 Working Draft Subject to Revision SOVEREIGN BONDS AND THE COLLECTIVE WILL Lee C. Buchheit G. Mitu Gulati Working Paper No. 34 March 2002 Georgetown University Law Center Washington DC 20001 The Georgetown-Sloan Project on Business Institutions is supported by a grant from the Alfred P. Sloan Foundation. Copyright 2002 Lee C. Buchheit G. Mitu Gulati Summary One hundred years ago in the United States confronted by the urgent need to find a debt workout procedure for large corporate and railroad bond issuers the financial community looked at three options amend the . bankruptcy law to permit reorganizations the predecessor of today s Chapter 11 not just liquidations of the debtor companies include contractual provisions in the underlying bonds that would allow a restructuring of those instruments with the consent of a supermajority of the bondholders or pursue a court-supervised debt restructuring by engaging the equitable powers of the civil courts to oversee such a process. A century later confronted by the urgent need to find a debt workout procedure for sovereign bond issuers the same three options are open for discussion. The International Monetary Fund is actively studying the possibility of constructing at the supranational level the equivalent of a Chapter 11 for countries . The use of contractual provisions to facilitate sovereign debt workouts -- an idea whose time had visibly not come even just a few years ago -- is being reconsidered by both the sovereign borrowers and the institutional bondholder community in the light of Argentina s catastrophic debt default in December 2001. Resort to the equitable powers of the civil courts to oversee creditor-led sovereign debt workouts is we believe possible in appropriate circumstances. The debate about the .