Al Zawawi and 109(a): Parsing What It Means to Be a Debtor Under Chapter 15 – JD Supra

What does it mean for an entity to be a debtor under chapter 15, and does it matter whether the entity is a debtor under that chapter of the Bankruptcy Code? While these may seem like strange questions with obvious answers, recent case law challenges those notions.

Section 1502 (1) of the Bankruptcy Code defines the term debtor, for purposes of chapter 15, as an entity that is the subject of a foreign proceeding. That somewhat circular definition is not expressly in sync with the requirements to qualify as a debtor under 109 (a) of the Bankruptcy Code that is, whether the entity has a domicile, place of business or property in the U.S. In In re Al Zawawi, the U.S. Bankruptcy Court for the Middle District of Florida referenced and expanded the split of authority as to whether a foreign debtor under chapter 15 must, in addition to satisfying the requirements of 1502 (1), meet the 109 (a) requirements applicable to other Code chapters.

Originally published in ABI Journal - May 2022.

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Al Zawawi and 109(a): Parsing What It Means to Be a Debtor Under Chapter 15 - JD Supra