SECTION 14 - ANNEX

DETAILS OF PROJECT

This is a regional technical assistance project of the Asian Development Bank.

The broad aims of the project are to:

• study the relationship between corporate debt and the insolvency or financial difficulty of corporate debtors in the region;
• suggest the components of a model of "best practices" which are suitable for the region to effectively deal with a problem or corporate insolvency and recovery of debt;
• make available, through an Asian Development Bank Home Page on the internet, the insolvency and other related legislation of RETA economies and the studies and reports produced as a result of the project.

The project commenced on 12 October 1998.

The ADB project officer is Clare Wee. The project is managed by John Lees of Ferrier Hodgson & Marfan, accountant of Hong Kong, China. The project is lead by Ron Harmer, a consultant to Blake Dawson & Waldron, Australian lawyers.

The approach to the study has been as follows:

• A consultant's work guide was prepared. This was divided into 21 sections of enquiry. The sections of enquiry included forms and structures of business organizations (concentrating on those which may be termed "large and medium size enterprises"); the banking system and the availability and forms of financing for such enterprises, including secured financing and enforcement; unsecured financing and enforcement; attitudes towards financial difficulty and insolvency; informal processes; the insolvency law regime; foreign and cross-border aspects of insolvency law; the inter relationship between lenders and borrowers; and a general assessment of various processes arising from the previous sections. These sections required response to some 162 issues. In this the objects was to discover the tangible form or substance of the issues and processes but also the more intangible influences that might intervene on the form and substance (for example, political, governmental, cultural and other such like influences).
• A local consultant was appointed in each of the 11 economies to furnish a local study based on the economies work guide.
• The local consultants were required to work with representatives of the finance sector, entrepreneurs, professionals and government.
• A field visit was undertaken to each economy during the preparation of the local studies.
• The local reports were furnished, together with the relevant insolvency law legislation and other material (for example that dealing with informal work-out practices).

This preliminary comparative report was written based on the above.