The analysis of the legal framework of Latin American sovereign bonds focusing on collective actions and enforcement of the borrower's obligation...

Introduction:?

The State to obtain resources to finance their activities goes to the financial market through two mechanisms: a borrowing individualised or issuing of bonds, which integrates the money and the capital markets[1], respectively. In the current reality of sovereign borrowing, the issuance of debt securities reaches a higher degree than loan contract agreements.?[2]. The main reasons for that preference refer to the advantages that the mechanism of government securities provides to both borrowers and lenders. Among these advantages, one can highlight a larger universe of potential investors[3], the possibility of implementing a borrower's monetary policy, easier control, more accessible and lower costs for trading, and the right to sue upon the instrument.

This dissertation's research is based on the legal framework of the capital market. It considers the functioning of the international capital market's processes and its distresses. Under the auspices of the law about international bonds, this paper focuses on a borrower's default, the restructuring process and the enforcement proceedings for executing bondholders' rights against borrowers' debt default. This paper aims to analyse contractual limitations existing within those processes. These hindrances appear to undermine bondholders' rights upon the bond. Solutions are going to be presented for the suggested problems. This dissertation limits the analysis of the processes and cases involving Latin American sovereign bonds. In addition, it will give preference to the study of instruments whose chosen Jurisdiction is the United Kingdom.

The collective action problem is the first issue under examination. This issue seems to appear when a debt restructuring is established. For example, bondholders who agreed to contribute to rescheduling sovereign debt could be in trouble if a single holdout creditor seeks legal proceedings against a borrower's default debt?[4]. (...)?

The aimed questions in this section are the followings: is the protection of sovereign borrower's assets a matter of fairness? What are the main complexities bondholders might face in seeking procedures against a borrower's default upon the bond? To what extent Courts can enforce a bondholder's right against a borrower's breach of bond contract??

This dissertation believes that the solution to both problems presented above may require innovations in the current system. Commentators have offered several proposals to improve the international financial architecture in light of certainty about the process of sovereign bonds[9].

To accomplish its aim, firstly, this dissertation will introduce essential terms of the theme.

This paperwork is divided into three chapters. The first chapter is introductory.?

In the second chapter, this dissertation examines the problems of collective action.?

In his third chapter, it will analyse the legal architecture for implementing a bondholder's credit rights. This issue arises when bondholders seek legal remedies to enforce their rights against a borrower's default on the debt. (...) it analyses the virtual limitation on the remedies for the enforcement of rights of bondholders against a borrower's contractual default.

It must be acknowledged that this author has a background in the field of law. This dissertation, nonetheless, challenges the author in dealing with theoretical questions that belong not only to the study of law but also to economics and finance[13][14].?

Chapter I – Development:?

This chapter is structured in six sections. (...)?

1.1. Historical review:?

Latin American countries have been on the spot during the nineteenth and twentieth century because they contributed massively to cross-border capital flows. Economic, political and social demands lead those countries to seek foreign capital?[16]. The transferring of money was arranged predominantly in the form of bonds during the nineteenth and early twentieth century[17]. This preference for bonds instead of loans retreated in the 1980s when Petrodollar loan agreements were predominant[18]. Nonetheless, capital loans returned in favour of bond issuances due to the arrangements made by countries at the end of the twentieth century and the beginning of the new millennium. Bonds tend to be spread among many different investors with disparate interests. Thus, bond issuance is the primary instrument for raising capital for those countries.?

In the ninetieth century, London became the world centre of international finance. The vast quantity of sovereign bond issues was affected by London. According to Yafeh?[23], London was unchallenged as the leading financial centre for emerging bond market issues. Latin American external debt was slightly more concentrated in British hands than other lenders. This tendency was maintained until the twentieth century. In 1914 and similarly, in 1938, the region accounted for about 55% of the world stock of foreign investment in developing countries[24]. Up to 1965, the relationship between lenders and borrowers ratios were around 68% for Britain, 14% for France, 16% for the USA, and 2% for Germany.?

World War I contributed to the decline of British lending servicing when exchange controls drove the international financial markets into New York. Private bondholder's councils were founded during that period. These entities executed negotiations on behalf of bondholders, so the settlements' time length has reduced.?

After World War II, there was a great depression. It was caused mainly by the shock provided by clashes of armies in that horrible moment in history.?

Virtually no foreign capital flowed from rich to developing countries for most of the post-war period[25]. This unstable economic, financial and social environment might explain the rise in the length of defaults worldwide. Latin American governments considerably defaulted on their obligation.?

The World Bank and the International Monetary Fund (IMF) were created after World War II to help avoid economic disasters. They appear as lenders for the reconstructing of countries worldwide, as well as for their development. International entities became the foremost lenders in the world scenario.

Most syndicated loans and international bonds business returned from the U.S. to London in the second half of the 20th century. But the close relationship between Latin American countries and the U.S. made still.?

Although the service of official international lenders played the leading role in Latin American Countries, it can be said that, by March 1989, the Brady Plan addressed debts under the dollar currency, and this facility increased the debtor-creditor relationship between the U.S. and Latin American countries.

The reason for the preference for loan contracts instead of sovereign bond contracts is ambiguous. Growing oil prices and real interest rates are cited as factors. Nonetheless, the Oil Crisis was temporarily overcome.?

The trend between loans and bonds changed again in the last 20 years. International bonds have largely replaced loans (from governments, commercial banks and official lenders) that had prevailed until the middle of the 1980s [30]. Today bonds are the main instruments for financing the external debt of the emerging market economies, including Latin American countries [31].

1.2. Default:

?A disruption in the economy of a country might trigger a crisis of considerable magnitude to force creditors to examine their legal options for recovery. In bond issuances, this disruption would be evidenced by "events of default"?[32].?

?The following are considered "events of defaults" under contractual law:?

?(1) non-payment; (2) breach of other obligations; (3) cross-default; (4) moratorium; (5) contestation (contesting the validity of the debt securities); (6) failure to obtain authorisations; (7) monetary judgment; (8) illegality (the adoption of any applicable law, rule or regulation which would make it unlawful to comply with the obligations agreed); and (9) IMF membership cessation.?

Upon an event of default, a creditor is faced with two alternatives:?

?(1) to enter into a negotiation with the debtor to reach a restructuring agreement, which usually worsens the credit's original terms.?

?(2) to pursue remedies against the debtor in a court of law trying to collect the total face value of the debt.?

This dissertation analyses those two alternatives in the last section of this instant chapter and chapter three, respectively.?

?1.3. Nomenclature / Types: (...)?

It is essential to remember that bonds, which are issued by governments, can be issued in different currencies, and they can be addressed to different kinds of investors. Bonds, which secure Euro loan transactions, are issued in foreign currency and are seldom addressed to the public. On the contrary, government bonds that secure ordinary loans are issued in local currency and often addressed to the public.

?It might be vital to differentiate those occurrences because they are not of the same kind. They do not receive the same legal treatment. Different legal implications are drawn for them. (…)?

?1.4 Nature of the bond:?

The multi-jurisdictional nature of international financial contracts involves significant risks[33]. Courts in different jurisdictions may have conflicting views regarding the nature of financial transactions, their contractual obligations, and implications[34].

As financial security, bonds inherit essential characteristics. Bonds entitle bondholders to the right to sue the issuer borrower upon the presentation of the bond instrument for breach of contract[36].

Consequently, the document entitles the holders with the right to be repaid at due demand. Modern issuances of sovereign bonds are being made in the form of registered electronic issues. However, there are still considered tradable instruments. (...)

Bearer bonds (older and classical forms) are the instruments that are held by investors directly from the issuer, whereas registered bonds are held indirectly through an intermediary. Direct holding investment securities have existed for hundreds of years. The ownership of the bond, and the right to be paid under it, are transferable by delivery (i.e. by transfer of possession).

They were the main form of issuing bonds until the last quarter of the 20th century[37]. Likewise, a promissory note, bonds contain an unconditional (and autonomous) order to pay, and they can be transferred from one person to another.

After that period, there was the development of cross-border electronic securities markets. This market has introduced the indirect holding pattern. It entitles the holder to the presumption of ownership upon the debt.

Although registered bonds can also be in paper form, modern issuances have been made in the form of a virtual instrument[38].??

A registration maintains a database known as a register on behalf of the issuer. Details of the holders of the securities and of their holdings are entered on the register. The transfer of ownership upon the security is completed by an amendment in the register and shows the details of the transaction.

These facilities are not of the nature of loan agreements. Each bond is usually issued in small amounts. It entitles the holder to the presumption of ownership upon the debt. Bonds attract fixed interest rates[44]. Those features turn it into a liquidated asset. The attribute confers to the title higher interest to investors than loans.?Sometimes they are registered on the stock exchange. These features provide flexibility to the debt in trading.

A sovereign bond, in specific, is also a kind of international bond[45]. They are issued in a country other than the country in whose currency the bond is denominated. It indicates that the currency of the bond is different from the place of issuance of the bond. The instrument terms of the bond are denominated in foreign currency (especially in dollars, pounds, euros or yen). (…)?

They are seldom issued to the public. The investors tend to be large financial institutions. They are usually unsecured instruments. They are usually underwritten by a group of firms before they are issued. Finally, many international bonds are listed on a stock exchange, usually the London or Luxembourg exchanges.

1.5. The legal framework:?

It is essential to define the contract's procedural (lato sensu) and substantive law. According to Philip Wood[47], most major international credit contracts contain a forum selection clause so that the general grounds on which courts exercise Jurisdiction where there is no empress submission are of less relevance. He states that international bond issues invariably contain a forum selection clause.?

Agasha Mugasha[48]?states that bond contracts normally have London or New York law as their legal Jurisdiction. These places are considered due to their Court's high standards and commercial-oriented approach.??

According to Issam Hallak[49], the governing law is determined by lenders' ability to take legal action against the sovereign defaulter under this law.?

It is vital to notice that each Jurisdiction commands different rules of the games for engaging in bond restructurings.?

The IMF has been defending a proposal for an international sovereign debt restructuring mechanism (SDRM). This system is still under debate within the IMF member countries.

This dissertation focuses on the English Jurisdiction rather than the American. The parties are demanded to choose also the substantial law applicable to the contract.?

According to Tennekoon[50], it is the issuer who decides which will be the applicable law in the case of bond issuance. This choice includes: (1) the level of protection (i.e. how effective the system is in protecting the interference of other systems); (2) the certainty and predictability of outcome in applying the chosen law; (3) the degree of party autonomy to avoid judicial interference; (4) conceptual sophistication; (5) market familiarity; (6) language (it is noteworthy that English is the language of the financial market); and (7) legal limitations on the choice of law.

As this dissertation demonstrated in the historical review of the Latin America bonds, a great part of the debt was issued under the United Kingdom Law. The applicable law to the contract was addressed to the United Kingdom rules.?

The law of the U.K. significantly regulates the institutions and the process involved in bond issuances. The institutions are subjected to authorisation by the FCA Board to carry on their investment business. The marketing of the financial product and the stabilisation of prices is regulated under the Financial Services Act 1986[51]. In addition, U.K. law subjects international bonds to registration requirements[52].?

Although the issuance procedure is thoroughly regulated, no international system regulates the relationship between insolvent estates and their creditors. Furthermore, that part regarding the relationship between parties is subjected to international principles and rules.

There is no statutory regulation for the process of restructuring sovereign debt under the English bond's Jurisdiction?[53]. There is no international convention on how to deal with insolvent debtor states or how default by such states could be tackled[54]. According to Frank Graaf[55], the market is not subjected to any regulatory authority and is totally free of control by either individual governments or supra-national institutions[56].?

The presence of international associations is important in that context[57].

The International Capital Market Association was formed in July 2005 by the merger of the International Primary Market Association and the International Securities Market Association (formerly the International Association of Bond Dealers)[58]?and has been immensely useful in means of promoting standardised practices.??

1.6. Restructuring programme:?

The procedure for the restructuring agreement might be carried in an ad hoc case-by-case basis. (…) According to Agasha Mugasha[59], the

debt-restructuring programme can be carried out through the IMF, Paris Club, and the London Club. Apart from the IMF, these clubs are informal forums where representatives of the borrower country, the financial institutions, corporations and also wealthy individual bondholders join in order to postpone the debt and agree upon more favourable terms.?

The substantial aspect is that the restructuring agreement is made up based on equitable burden sharing. The Paris Club's practice is to work on the grounds of equitable sharing[60]. The legitimacy of the agreement that is sought in that process is based on the principle of?pacta sunt servanda[61].??

Since rescheduling and exchange of old bonds for new bonds (old debt for new debt) seems to be a postponement of debtor obligations, creditors would like some "guarantee" that this postponement will, in fact, contribute to an improvement in the economic conditions of the debtor country and that it will enable it to better service its external debt. One way to obtain this would be for the debtor country decides to adopt an adjustment programme supported by the IMF[63].?

In most Fund-supported programs, a combination of policy adjustments and financing from the Fund catalyses spontaneous external financing from the private sector and, in some cases, new financing from the official sector[64]. Therefore, the member is able to continue to service its debt in accordance with its restructured terms and preserve market access.

1.6.1. A detailed example of restructuring:??

A remarkable forum-restructuring example is the one realised in 1943 for the Brazilian external and internal debt restructuring[65].

The restructuring was accomplished under the agreement made with representatives of the Council of Corporation of Foreign Bondholders, situated in London, and the Foreign Bondholder's Protective Council, situated in New York, through a Paris and London Club scheme. The aim was to restructure bonds issued in both Sterling Pound and Dollar, respectively.?

The Brazilian bonds in pound sterling negotiated under the agreement contained an express clause addressing the forum and the applicable law to the United Kingdom[66].

The agreement was incorporated into the Brazilian legal framework by the issuing of the Presidential Decree Law n. 6.019, 1943.??

This statute, among other dispositions, provided a period for bondholders to exercise the right of choice for two Plans of debt relief. Bondholders had from 1st January to 31st September 1944 to exercise their right of preference upon the new terms of the restructuring agreement for the mentioned international Brazilian bonds. Those bondholders who did not fulfil that choice were deemed automatically inserted in Plan A[67].?

This restructuring, in specific, called the attention of this dissertation because it illustrates the?arrangement of ad hoc restructuring. The concept of this process will also be the premise for one of the analyses that are going to be carried out in the next chapters of this dissertation, where it analysis the interference of the holdout creditor in the process of restructuring sovereign debt and the uncertainties this creditor might face in enforcing their rights upon the bond.??

Chapter II – Collective Action:?

(…) See full paperwork.

Chapter III – Enforcing a judgement to pay upon the bond:??

(…) See full paperwork.?

THE CONCLUSION:?

This dissertation deems to have accomplished the proposed research. It analysed the legal framework of sovereign bonds by scrutinising its foundations and essential issues within the context, i.e., the collective action and the enforcement of a money decision in favour of the bondholder's right upon the bond contract.?

This dissertation provided the identification of complex trends, issues and features involving the framework of the Latin American sovereign bond. It analysed the legal framework of sovereign bonds, whose applicable law is the United Kingdom law. It identified the legal issues within the matter and analysed them by providing arguments, comments from experts, case decisions, examples and statistical results.?

All the elements of the research were combined in order to be understandable. This dissertation drew limitations on the aspects of the theme to raise the most relevant premises for the analysis proposed. The findings are as follows: (…)?

The framework of the capital market permits bondholders to feel pressure in the way of negotiating their rights upon the bond. This dissertation analysed the role of a special category of investors in this context. They are the vulture and hedge funds that are potential investors in bond securities. They are important figures in the analysis of collective action because they are potential holdout creditors. Their structure permits those funds to buy large amounts of poorly rated securities and enforce them against the borrower. Their technical and financial capacity increases the chances of a successful claim, thus enhancing the risk of the holdout problem.?

This dissertation presented examples of Latin American countries' cases and their related statistics. It identified and analysed the existing solutions for the holdout problem. It analysed the leading existing solutions to the problem of a holdout.

This dissertation identified and commented on the hindrances of those contractual instruments. It analysed the clauses which are considered most relevant in the market. The mandatory action clause project was presented. (…)

This dissertation demonstrated (by means of a logical sequence of steps) the significant issues that a creditor has to keep in mind before enforcing a money decision against the sovereign borrower, e.g. determining where to sue; immunity from suit; personal and subject-matter jurisdiction; the act of state doctrine and state immunity. (...)?

REFERENCES:?

[1]?Frank Graaf,?Euromarket Finance: Issues of Euromarket Securities and Syndicated Loans, Kluwer International Law, London, 1991.

[2]?Arturo C. Porzecansky, 'From Rogue Debtors: Implications of Argentina's Default' in?Chicago Journal of International Law, vol. 6, issue 1, 2005, pp. 311-332.

[3]?See Agasha Mugasha, 'Solutions for Developing-country External

Debt: Insolvency or Forgiveness', in?Law and Business Review of the Americas, vol. 13, issue 4, 2007, pp. 859-884.??

[4]?Christopher Mallon and Shai Waisman,?The Law and Practice of Restructuring in the U.K. and U.S., Oxford University Press,

Oxford, 2011.?

[5]?See Philip R Wood,?International Loans, Bonds and Securities Regulation, Sweet & Maxwell, 1995.

[6]?See Andrew McKnight,?The Law of International Finance, Oxford University Press, Oxford, 2008.

[7]?See?supra?n. 3.??

[8]?Rutsel Silvestre J. Martha,?infra?n. 137; Lee C. Buchheit and G. Mitu Gulati?infra?n. 105.

[9]?Mark L. J. Wright, 'Sovereign Debt Restructuring: Problems and Prospects',?infra?n. 87; See also Holger Schier,?infra?n. 34.

[10]?Rutsel Silvestre J. Martha,?infra?n. 137.

[11]?See Kathrin Berensmann and Angelique Herzberg, Sovereign Insolvency Procedures – a Comparative Look at Selected Proposals, in?Journal of Economic Surveys, vol. 23, issue 5, 2009, pp. 856-881.

[12]?Maria Chiara Malaguti, 'Sovereign Insolvency and International Legal Order', in?International Community Law Review, vol. 11, issue 3, 2009, pp. 307-326.?

[13]?Pierre Legrand, 'How to compare now',?Legal Studies, vol. 16, issue 2, 1996, pp. 232-242.

[14]?Ibid idem.?

[15]?See David Nelken, 'Comparative Law and Comparative Legal Studies,

David Nelken and Esin ?rücü (ed.), in?Comparative Handbook – A Comparative Handbook Oxford and Portland, Oregon, 2007.

[16]?Ugo Panizza, Federico Sturzenegger, Jeromin Zettelmeyer, 'The Economics and Law of Sovereign Debt and Default', in?Journal of Economic Literature, vol. 47, issue 3, 2009, pp. 651-698.

[17]?Marcelo de Paiva Abreu, 'The External Context', in?The Cambridge Economic History of Latin America: Volume 2, The Long Twentieth Century, (ed. Victor Bulmer-Thomas, John H. Coatsworth, and Roberto Cortés Conde), Cambridge University Press, Cambridge, 2005.

[18]?Theodore Allegaert, 'Recalcitrant Creditors against Debtor Nations, or How to Play Darts', in?Minnesota Journal of Global Trade, vol. 6, issue 2, 1997, pp. 429-472.

[19]?The most widely used sources of cross-country data on public debt are the International Financial Statistics (IFS) published by the International Monetary Fund and the World Development Indicators (WDI) and Global Development Finance (GDF) published by the World Bank. Data on a smaller set of countries are also available from the U.N. Economic Commission for Latin America (ECLAC) and from the Organization for Economic Cooperation and Development (OECD).

[20]?Kevin Cowan, Eduardo Levy-Yeyati, Ugo Panizza, Frederico

Sturzenegger, 'Sovereign Debt in the Americas: New Data and Stylised Facts', Inter-American Development Bank, 2006.

[21]?See Henrik Enderlein, Christoph Trebesch, Laura von Daniels, Sovereign Debt Disputes: a database on government coerciveness during the debt crisis, in?Journal of International Money and Finance, vol. 31, issue 2, 2012, pp. 250-266.

[22]?Aldo Musacchio, 'Can Civil Law Countries Get Good Institutions? Lessons from the History of Creditor Right and Bond Market in Brazil', in?Journal of Economic History, vol. 68, issue 1, 2008, pp. 80-108.?

[23]?Paulo Mauro and Yishay Yafeh, 'The Corporation of Foreign Bondholders', in IMF Working Papers W.P./03/107, May 2003.

[24]?Cf Thomas Oatley, Political Institutions and Foreign Debt in the Developing World, in?International Studies Quarterly, vol. 54, issue 1, 2010, pp. 175-195.

[25]?Alan M. Taylor, 'Foreign Capital in Latin America in the Nineteenth and Twentieth Centuries', NBER working Paper n. 9580, National Bureau of Economic Research, 2003.

[26]?See supra n. 17.

[27]?Ibid idem.

[28]?World Bank, 'Private Capital Flows to Developing Countries, in Global Development Finance, 2000.

[29]?Elizabeth A. Cobbs, 'Entrepreneurship as Diplomacy: Nelson Rockefeller and the Development of the Brazilian Capital Market', in?Business Historical Review, vol. 63, issue 01, 2011, pp. 88-121.

[30]?Michael Waibel,?Sovereign Defaults before International Courts and Tribunals, Cambridge University Press, Cambridge, 2011.

[31]?Ibid idem.

[32]?See Rodrigo Olivares-Caminal,?Legal Aspects of Sovereign Debt Restructuring,?in Sweet & Maxwell, London, 2009.

[33]?Joanna Benjamin,?Financial Law, Oxford University Press, Oxford, 2007.?

[34]?See See Holger Schier, Towards a Reorganisation System for Sovereign Debt, in?Martinus Nijhoff Publishers, Giessen, 2006;

[35]?Cf. Márcio Ferro Catapani, ‘O Mercado de Títulos Públicos: desmateraliza??o e circula??o’, Doctoral Thesis, Faculdade de Direito, Universidade de S?o Paulo, S?o Paulo, 2011. Among other issues, this author provides a differentiation in the definition of the nature of the bonds between the civil law and common law.?

[36]?See?supra?n. 1.

[37]?See?supra?25.

[38]?Colin Paul and Gerald Montagu,?Banking and Capital Markets Companion, 5th Ed., Bloomsbury Professional Ltd, 2011.

[39]?See Philip R Wood,?Law and Practice of International Finance,

Sweet & Maxwell, London, 2008.

[40]?See Galina Hale, 'Bonds or Loans? Effect of Macroeconomic Fundamentals', in The Economic Journal, vol. 117, issue 516, January 2007, pp. 196-215.

[41]?See?supra?n. 3.?

[42]?See?supra?n. 40.

[43]?Michael Waibel, 'Opening Pandora's Box: Sovereign Bonds in International Arbitration, in?the American Journal of International Law,

vol. 101, issue 4, 2007, pp. 711-759.

[44]?Agasha Mugasha,?The Law of Multi-bank Financing: syndicated loans and the secondary market, Oxford University Press, Oxford, 2007.

[45]?Ramu Sarkar,?International Development Law – Rule of Law, Human Rights, & Global Finance, Oxford University Press, Oxford, 2009.

[46]?See supra n. 3.?

[47]?See?supra?n. 39.

[48]?Agasha Mugasha, 'International Financial Law: Is the Law Really "International" and Is it "Law" Anyway?', in?Banking and Finance Law Review, 26, 2011, pp. 381-449.

[49]?Issam Hallak, 'Governing Law of Sovereign Bonds and Legal

Enforcement', (ed. Robert W. Kolb),?Sovereign Debt: From Safety to Default, John Wiley & Sons, New Jersey, 2011, p. 205. Note that this author also finds that the credibility and the enforcement costs associated with each law have an impact on the size of the bond (yearly amounts and bond size relative to GNP).?

[50]?Ravi C. Tennekoon,?The Law & Regulation of International Finance, Butterworths, London, 1991.

[51]?Ibid idem.

[52]?See?supra n. 48.

[53]?Cf.?infra?n. 137.?

[54]?See Juan Pablo Bohoslavsky, Lending and Sovereign Insolvency: A

Fair and Creditors, in?Goettingen Journal of International Law, volume 2, issue 1, 2010, pp. 387-412. According to this author, there are no formal and fixed rules regulating the credit preference ranking in cases of sovereign insolvency under a general framework, lacking an effective sovereign bankruptcy regime. He outlines the "week parity treatment" rule, which is altered in practice by the use of preferred treatment, given, for example, to international institutions (IFIs) credit, secured debts, trade debts, new debts, collateralised loans, and inter-bank deposit debts, among others.?

[55]?See?supra?n. 1.

[56]?Perhaps this framework of the market led Alfonso Prat-Gay, former Governor of the central bank of Argentina, that "Having been in the Financial Markets during the last years, I can't believe how short minded markets are" in a lecture entitled "Recovering from Crisis – Argentina Today' given at LSE, London May 1212th May, 2004. The reference is available in Rodrigo Olivares-Caminal's book.?

[57]?See Ana Gelpern and Mitu G. Gulati, 'Public Symbol in Private Contract: A Case Study, in?Washington University Law Review, vol. 84, issue 7, 2006, pp. 1627-1716. For most of the period studied, seven trade associations catered to the investor community. Three focuses on Emerging Markets, other four deal overwhelming with mature market securities. The authors state that all but one trade group Market Creditor Association (EMCA) was established specially to represent the buy-side.?

[58]??See International Capital Market Association (ICMA), 'About ICMA', available at < https://www.icmagroup.org/About-ICMA/ > 02 July 2013.

[59]?Supra?n. 3.??

[60]?Supra?n. 54.

[61]?Christian Barry and Lydia Tomitova, 'Fairness in Sovereign Debt'

in?Ethics & International Affairs, vol. 21, issue S1, 2011, pp. 41-79. This author affirms that "Pacts must be respected", is the basic norm that underlies the present treatment of sovereign debt contracts; See Elmar B. Koch, 'Collective Action Clauses: The Way Forward', in?Georgetown Journal of Law, vol. 2004, issue 4, pp. 665-692.

[62]?Keren Hudes, 'Coordination of Paris and London Club Reschedulings', in?New York University Journal of International Law and Politics, vol. 17, issue 3, 1984, pp. 553-572.

[63]?Stephen B. Kaplan,?Globalization and Austerity Politics in Latin America, Cambridge University Press, Cambridge, 2013.

[64]?International Monetary Fund (IMF), 'Sovereign Debt Restructuring – Recent Developments and Implications for the Fund's Legal and Policy Framework', in Review, April 2013.

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