Protection of Assignor’s Bankruptcy Creditors in Case of Assignment of Claims with an International Element

Sa？etak Determination of the law applicable to assignment of claims is complicated since it requires separate determination of the law governing three different relationships. Firstly, the law governing the relationship between the assignor and the assignee; secondly, the relationship between the assignee and the debtor; and finally, third-party effects of assignments of claims. This paper analyses the rules of the Rome I Regulation on determination of the law applicable to assignment. The Regulation contains conflict of laws rules for the first two relationships but not for the third-party effects of assignments of claims. The authors analyse precisely that third relationship in more detail while discussing the situation in which the assignment of a claim is used as a means for disrupting the line of creditors in bankruptcy proceedings. The authors conclude that in such a case the third-party effects of assignments of claims should be governed by the law of the assignor’s habitual residence or seat, or the creditors should otherwise be protected by overriding mandatory rules