Admiralty proceedings against a vessel are necessarily territorial in nature. A debtor’s vessel may sail into a certain jurisdiction and be arrested and sold for the benefit of creditors who both have Admiralty in rem claims against the vessel and actively take the required steps in the Court proceeding concerned. Creditors not having rights of claim of that nature would miss out or only have a very low priority in respect of the proceeds of sale. In contrast, the Insolvency (Cross-Border) Act 2006 (“Act”) is designed to facilitate the realisation of the debtor’s assets in a single jurisdiction in accordance with the pari passu principle (that is, equably, without preferring one creditor – no matter where they are located – over another).
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