China has long been under external pressure to develop a market-based approach to bankruptcies and reduce state involvement in such cases. The enactment of the Enterprise Bankruptcy Law 2006 was an important first step in this regard but laws are insufficient in themselves and this Act has given rise to a very low number of cases, attributed in part to ongoing state influence. This paper examines the reasons for the law's limited impact, paying particular attention to the role of the state, which appears to be changing.
Cloud computing has revolutionised data handling in recent years in enabling the usage of computing resources, including for the storage of data, through flexible and on-demand services, often accessed through the internet. 1 One potential consequential challenge which has only been briefly touched upon previously is the containment of the impact of an insolvency in this area, as access to data, as well as the means of processing this data, may be significantly delayed or even lost upon the failure of a cloud service provider, 'CSP'. This is a matter of serious concern, both to businesses and consumers, as growing reliance on cloud computing technologies presents risks of an insolvency having a potentially systemic nature. This article represents an initial attempt to identify possible approaches to the threat of cloud computing insolvencies, suggesting a double layered approach in view of the significant risks for both businesses and consumers and with potential variations in scale and impact, with the potential for a 'too big to fail' scenario. Lying at the intersection of insolvency law and technological innovation this is an area which is as yet almost entirely unexplored.Cloud computing arrangements give companies attractive possibilities regarding IT management, for example through outsourcing of elements. Cloud storage is almost instantly scalable and adaptable, one of the factors enabling users to achieve lower IT costs. 2 Significant savings can be made, for example since the need for companies to own hardware and pay associated running costs can be reduced and fewer specialist IT staff may be required. Software can be made more widely available through being offered for access through subscription. Cloud services therefore put advanced technologies within the reach of small and medium enterprises, for example, without the upfront cost that this would otherwise entail. Such potential savings are attractive in an economic climate which has generated a need for costs cutting, and this has thus fuelled the usage of cloud services. 3 Cloud computing also helps developers, as they can gain infrastructure without the expensive outlay that this would otherwise entail. It facilitates flexible working arrangements, including working from home and BYOD. It is estimated that by 2021, 94% of workloads and computing instances 4 will be processed by cloud data centres and the use of traditional data centres will decline. 5 The scalability of cloud computing also enables much faster processing and analysis of Big Data. 6 However, in spite 7 Prashant Gupta, A Seetharamana and John Rudolph Raj, 'The Usage and Adoption of Cloud Computing by Small and Medium Businesses' (2013) 33 International Journal of Information Management 861 noted that in their study of SMEs there was a lack of confidence in the reliability of cloud service providers. 8 The leading UK text, Christopher Millard (ed), Cloud Computing Law (Oxford University Press, 2013) discusses insolvency only as grounds for the termination of a contract for clo...
The enactment of bankruptcy laws by the People's Republic of China (PRC or China) in 2006 was a necessary step in the development of its economy. This law represented a significant modernisation of the insolvency framework, supporting the transforming economy, but it was also a law of political expediency, for the enhancement of external relations. One aspect of the enhancement of external relations was the provision of cross-border insolvency rules. However, this complex area of law was addressed in only one article, which was only a starting point, leaving many details unaddressed, and further reforms are required. In particular, it is desirable that the law provides a greater level of predictability as to the likely outcomes of cross-border insolvencies, to encourage inward trade and investment, as well as encourage external trade. Both inbound and outbound business dealings are important to China's continued economic development. It is clear also, however, that insolvency law and practice is still a developing area for China. The establishment of a modern and unified system of insolvency laws was a big step for China, representing a sacrifice of tight controls on insolvencies, but the impact of this law in practice is only recently developing, with a loosening of state controls, after a very slow start.1 The establishment of a cross-border insolvency framework represents a further challenge; one that is likely to beset with considerable difficulties, as any further development of this law would potentially entail some further loss of control over proceedings, not least in outbound cases, and resistance may be anticipated. In keeping with China's historical approach to lawmaking in the area of bankruptcy law, it is likely that the cross-border *E-mail: rebecca.parry@ntu.ac.uk; jessepool1@hotmail. com 1 Numbers of bankruptcies remain low, because of a government preference for mergers and restructurings and deregistrations as alternatives to liquidation and some courts placing restrictions on the acceptances of cases. However, the Supreme People's Court reported an increase of 54% in bankruptcy cases in 2016, attributed in part to efforts to eliminate zombie companies, and an upward trend was reported in the first half of 2017. insolvency framework will develop gradually and with caution. This article assesses the way forward in respect of cross-border insolvency laws, contending that an incremental approach over a period of years, in three broad stages, is required, with more developed and country-specific approaches providing a link, or interim stage, between the clarification of the Article 5 and the formal adoption of the
2 T. Huang, 'As China Recovers from The Pandemic, Will Zombie Firms Return? '21 st October, 2020, https://www.piie.com/blogs/china-economic-watch/china-recovers-pandemic-will-zombie-firmsreturn 3 Y.
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