Party Autonomy in International Property Law - Peace Palace Library

12. Party Autonomy and Insolvency Law
handed down on the basis of the insolvency regulation, is recognized or
declared enforceable in Belgium in accordance with article 22 (…).
§ 2. A foreign judicial decision as referred to in § 1 may not be given
effects in Belgium that are contrary to the rights of parties pursuant to
the rules established in article 119, § 2-§ 4.’ 22
Consequently, the protection of reliance on the irreversibility of a particular
transaction under the lex causae in many cases may extend to transactions
with counterparties in any jurisdiction and governed by any law.
This means that the number of legal systems available to parties that
wish to make their transaction safe against avoidance in insolvency is in
theory unlimited.
12.3. Concluding observations
Accepting party autonomy in international property law has consequences
for the protection offered to other creditors under insolvency law by avoidance
rules. The point of departure is that the reversal of pre-insolvency
transactions is governed by the lex concursus. However, it is a common
feature of the EC Insolvency Regulation and rules of customary private
international law in a number of jurisdictions that the ‘legitimate’ expectations
that a transaction was valid and not subject to reversal under the
law governing that transaction are protected. One of the consequences
of allowing party autonomy in international property law would be that
parties could choose the law that is most favourable to them in terms of
avoidance of the rights they have acquired. Parties can avoid avoidance
by way of a choice of law. This in itself is nothing new, but allowing party
autonomy in the field of international property law would add to the
choices available for parties to make their transaction safe against subsequent
interference by a liquidator in insolvency proceedings.
This in itself, however, should not be considered a decisive argument
against the possibility of party autonomy in international property law. In
most cases, the choice for a particular law will be based on a number of factors,
such as the parties’ knowledge of and familiarity with the chosen law,
its useful purpose for the transaction (other than making it safe against
avoidance actions), and so on. It is also not an unknown feature that legal
22
Translation by the author.
P. M. Veder
275
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