3.1.2. Provisioniil and Protective Measure

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Article 3 ( 1 ) enables the court having jurisdiction to open main insolvency proceedings

to order provisional and protective measures from the time of the request to open

proceedings."" These measures can be ordered by the court, irrespective of the Member

State in which the persons or assets concerned are located and the measures are to have

elfect. These measures are recognised and may be entorced in other Member States

in accordance with Article 23( 1) third indent.

The power of the main court to order provisional and protective measures on the basis

ot Article 3 ( 1 ) does not however prevent the liquidator from requesting such measures

from the courts in the Member State where they should take effect. In the latter case,

the (international) jurisdiction of the court as well as the substantive conditions for

the ordering of such measures is determined by the national law of the Member State

where the measures are requested. However, these measures remain ancillary and

subordinated to any decision taken in the main proceedings bv the court having jurisdiction

by virtue ol Article 3(1). The latter court may therefore even order the lifting,

modification or continuation of these (national) measures. T h e possibility to seek the

assistance of local courts may help the liquidator to preserve (assets of) the estate, for

instance in case rights in rem in the sense of Article 5 are involved. It must be assumed

that, also in respect of provisional and protective measures, the main proceedings are

not accorded extraterritorial effect vis-a-vis such rights.

In addition to these two possibilities, provisional measures are also available under

Article 38, entitled 'preservation measures'." Article 38 concerns the situation that

the court having jurisdiction on the basis of Article 3( I ) has appointed a provisional

liquidator. Under the Regulation a provisional liquidator is not entitled to request the

opening of secondary proceedings. Article 38 allows the provisional liquidator to

preserve the debtor's estate also in other Member Stales for the time between the reI

Section Three. Council Regulation 1346/2000 on Insolvency Proceedings

Member State of opening. It is therefore not relevant whether that decision is final or

whether it may be subject to appeal. The decisive question is whether it takes effect."

Although recognition is subject to a general exception of public policy, Article 16( 1 )

excludes the possibility for Member States to refuse recognition on the grounds that

the debtor would not be eligible tor insolvency proceedings under the law of the

Member State of recognition.'"" Recognition of the judgment opening main insolvency

proceedings does not preclude the opening of secondary proceedings.

The principal el tects of recognition are provided by Articles 17 and 18.1 n conjunction

with the rule of Article 16 they constitute the Regulation's effectuation of the 'principle'

of universality of insolvency proceedings. According to Article 17 the effect of recognition

is that the opening of main insolvency proceedings will produce in all the

Member States the same effects it has according to lex fori conairsus. To produce these

effects no further formalities are required. Article 1 7 subjects this universal or Unionwide

effect to two exceptions, hirst, the Regulation itself may provide otherwise, primarily

through its choice of law rules."1 1 Secondly, the opening of secondary proceedings

in another Member State will generally block the extraterritorial effects of

the lex fori concitrsns principalis vis-a-vis that Member State.1"

.1 2.2. Powers Main Liquidator

Where Article 17 concerns the exportation of the substantive effects of the opening

of insolvency proceedings, Article 18 does essentially the same for the liquidator's

powers. The liquidator of the main proceedings may exercise all the powers which s/he

enjoys under the lex fori coucarsiis.'"" In particular s/he may remove assets to the main

forum, subject to Articles 5 and 7 concerning lights rem and reservation of title.

As the judgement opening insolvency proceedings, including the appointment of the

liquidator, is recognised tie litre on the basis of Article 16, the liquidator may exercise

his or her powers without any need for formalities."

Like the extraterritorial effect of the lex fori concursits, the powers of the liquidator are

subject to some (territorial) limits. First, the exercise of the liquidator's powers is subject

to the opening ot secondary proceedings or (incompatible) preservation measures

ordered in relation thereto."" Secondly, s/he cannot exercise anv powers involving

coercive measures or the ruling on legal proceedings or disputes. The liquidator will

have to go through the appropriate channels under the law of the Member State where

s/he wishes to take such m e a s u r e s . " Finally, the Regulation provides that the liquidator

must in the exercise ot his or her powers comply with the law of the Member

State where s/he wishes to act, in particular with regard to procedures for the realisation

of assets.1 '"This limitation on the liquidator's powers, which are after all determined

according to the lex fori conciirsiis, is not all together clear. Presumably what

is meant is compliance with a Member State's 'general' or 'non-insolvency' law. Thus,

although the lex fori concursits determines whether assets must be sold by public

auction or otherwise, the law of the Member State of auction would govern the procedure

and format of such auction.1 " The Report Virgos-Schmit provides the further

example of a law prohibiting the exportation of goods ot cultural or historic significance.

Opposition to the exercise of powers by the liquidator is not as such regulated by the

Regulation. 'General rules shall therefore be applicable', according to the Report."

Which rules exactly and their source remain unclear. Nevertheless, according to the

Report, it would follow that if the grounds for opposition concern a violation of the

Regulation's rules on the recognition of the foreign proceedings or the decision

appointing the liquidator, the authorities of the Member State where the liquidator

intends to act will have jurisdiction. These authorities would also enjoy jurisdiction

in case the grounds for opposition lie in the liquidator acting contrary to the rules relating

to the extraterritorial exercise of his or her powers. In contrast, in case the opposition

is aimed at 'the substance' of the exercise of those powers, that is: the justification

for a measure which the liquidator intends to take, then the authorities ot the

Member State where the proceeding have been opened would be accorded jurisdiction."

I Section Three. Council Regulation 134f>/2000 on Insolvency Proceedings