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How Neutral is the Law of Sovereign Debt Restructuring?

The myth of neutrality permeates many spheres of international law. In the law of sovereign debt restructuring, it is under pressure, especially in the aftermath of the Global Financial Crisis. The key assumption is that the status quo allows the market to freely develop its own standards, and use contracts to autonomously structure their bargains. Secondly, the actors of sovereign debt restructuring (such as the Institute of International Finance) are sometimes labelled as hybrid public-private entities. This aims at legitimating them as neutral, by implying that they fairly and adequately take into account and balance all the interests at stake. Thirdly, the procedure followed by the International Monetary Fund (IMF) during a restructuring is supposed to be neutral, and follow the same steps for all countries affected. This paper critiques each of these assumptions. […]