The introduction of the principles of unity and universality has resulted in a legal framework for cross-

border insolvency cases within the European Union under which a single set of insolvency rules can
apply to the enforcement of all creditors’ claims, and decisions of the competent authority have
universal application. The Insolvency Regulation and the two Directives do not seek to harmonise
national legislation concerning reorganisation measures and winding-up proceedings, rather they ensure
mutual recognition and coordination of these procedures by member states. The principles of home
country control, minimum harmonisation and mutual recognition - forming the core of the market
integration principles for financial markets - have also been transposed in the field of insolvency
procedures and constitute the basis of the Winding-up Directive for insurance undertakings and the
Windingup Directive for credit institutions. In particular, the home country and mutual recognition
principles - being introduced by the First and Second Banking Co-ordination Directives,46 respectively -
are extended to the insolvency of credit institutions

The main objective of the Insolvency Regulation is to ensure that cross-border insolvency proceedings
operate efficiently and effectively within the European Union. Another objective is to avoid incentives
for parties to transfer assets from one member state to another and/or to choose the jurisdiction in
which to initiate insolvency proceedings in order to obtain the most favourable legal position (“forum
shopping”).48

the United Kingdom. Recent case law from the BCCI affair83 suggests that the courts will apply the
provisions of English law to such proceedings, even where the effects of doing so mean a different
outcome from the potential results of applying the relevant provisions of foreign law. Foreign liquidation
proceedings may be recognised in the United Kingdom in a number of instances, namely where the
winding-up is conducted under, or recognised by, the law of the place where the company is
incorporated; where the company has submitted to the jurisdiction of a foreign court; or, where the
company carried on business in a foreign jurisdiction. Such recognition, however, may be conditional on
the requirement that such grant of recognition would not be contrary to public policy, constitute fraud,
or entail an attempt to enforce foreign penal or revenue law through foreign proceedings. Furthermore,
there is a general principle in English law that the courts do not generally recognise foreign proceedings
where they result in an outcome creating a material difference in the treatment of creditors as opposed
to the potential outcome of such proceedings under English law.