Portal de Periódicos da CAPES

The Argentine collective action clause controversy

2020; Oxford University Press; Volume: 15; Issue: 4 Linguagem: Inglês

10.1093/cmlj/kmaa016

1750-7227

Lee C. Buchheit, Mitu Gulati,

International Environmental Law and Policies

Collective action clauses (CACs) are contractual provisions that permit a majority or supermajority of holders of a multi-creditor debt instrument such as a bond to make decisions that bind all holders of the instrument. Hailed as an innovative technique to facilitate sovereign debt restructurings in this century, CACs have become the object of a bitter controversy in the proposed 2020 restructuring of Argentine bond indebtedness. Collective action clauses were first introduced in corporate bonds governed by English law in 1879. The English lawyer who claimed paternity for the clause, Francis Beaufort Palmer, was not bashful in describing its purpose. He wrote: The object of conferring this power on the majority is to protect it against unreasonable conduct on the part of the minority, and to prevent a deadlock happening when unanimity cannot be obtained. Unless the majority is thus enabled, in special circumstances,...