Debtwire’s Laura Gardner speaks with Richard Cooper and Jim Ho, partners at Cleary Gottlieb, about new legislation being considered by the state of New York, and what it means for sovereign debt restructurings.

Richard explains that the changes are made up of three separate bills, which seek to create a comprehensive mechanism to restructure sovereign debt, expand the champerty defense and limit creditor recoveries. He highlights how some of these proposals lack clarity, could lead to jurisdiction migration and risk making borrowing more expensive for sovereigns.

Jim explains how the UK has sought to deal with the issues from an English law perspective, where similar proposals have so far been rejected by the government.

They both agree that more should be done to incentivise official and private sector to invest to try and solve sovereign debt challenges.

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