Draft Legislative Guide on Bank Liquidation – Consultation


The International Institute for the Unification of Private Law (UNIDROIT) is conducting a consultation regarding a Draft Legislative Guide on Bank Liquidation.


Consultation period

The consultation will run for 16 weeks from 5 June 2024 – 25 September 2024 (midnight Rome time).


Objective of the consultation

The purpose of this consultation is to:

  • Raise awareness about the instrument.
  • Ensure that the instrument is well-suited to application in different contexts, including both civil and common law jurisdictions, as well as developing economies, emerging markets, and developed economies.
  • Seek feedback on whether the instrument sufficiently addresses the private law issues that arise in bank liquidation proceedings.


Target audience

Views are welcome from all interested parties. For the more technical aspects, feedback is welcome in particular from persons and entities representing:

  • National and supranational authorities (e.g., banking supervisors, resolution authorities, deposit insurers, securities regulators, and international organisations);
  • Insolvency practitioners and law firms;
  • Banks and banking associations;
  • Academics and think-tanks.


About the Draft Legislative Guide

The Draft Legislative Guide has been prepared by the Working Group on Bank Insolvency over the course of six sessions between December 2021 and March 2024. For more information about the Working Group and its meetings, please see https://www.unidroit.org/work-in-progress/bank-insolvency/.

The aim of the Legislative Guide is to assist legislators and policymakers in the design of effective bank liquidation regimes. The Guide complements existing international standards and focuses on the orderly liquidation of (i) banks that are not placed under a resolution procedure compatible with the FSB Key Attributes, and (ii) parts of a bank following, or in the context of, a resolution action.


The Draft Legislative Guide consists of ten Chapters:

  • Chapter 1: Introduction
  • Chapter 2: Institutional Arrangements
  • Chapter 3: Procedural and Operational Aspects
  • Chapter 4: Preparation and Cooperation
  • Chapter 5: Grounds for Opening Bank Liquidation Proceedings
  • Chapter 6: Liquidation Tools
  • Chapter 7: Funding
  • Chapter 8: Creditor Hierarchy
  • Chapter 9: Group Dimension
  • Chapter 10: Cross-Border Aspects

Each Chapter contains a discussion of key issues and a set of Recommendations for legislators and policymakers. The Recommendations as such do not constitute provisions that could be directly enacted in national law. Rather, they provide guidance on core issues that it would be desirable to address in an effective bank liquidation framework.


Consultation document

The Draft Legislative Guide on Bank Liquidation can be found here.


How to submit your response

Respondents may provide feedback on any part of the draft Legislative Guide. Comments should be submitted to the UNIDROIT Secretariat at LGBLconsultation@unidroit.org.

All comments should be included in a Word document and should be provided in English or French. For each comment, please specify to which Chapter and paragraph number of the Draft Legislative Guide it pertains.

The comments received during this consultation process will be made public. The name of respondents will be made public unless expressly requested otherwise.


Next steps

The Working Group on Bank Insolvency will consider the feedback received at its seventh session between 18-20 November 2024. It is anticipated that the Legislative Guide on Bank Liquidation will be finalised and published in 2025.