UPDATE 1-Puerto Rico asks for quick decision in bankruptcy ruling appeal

Puerto Rico has asked a U.S. court for a quick decision in its appeal against a federal court ruling that voided a local bankruptcy law, arguing the decision hampers its efforts to deal with a financial emergency that could disrupt basic public services on the Caribbean island.

A federal court struck down Puerto Rico's Recovery Act earlier this month in a blow to the U.S. commonwealth's efforts to restructure up to $20 billion in debt at three main public corporations. Puerto Rico passed the act last year because it is excluded from the U.S.bankruptcy code.
In papers filed late on Thursday with the First Circuit Court of Appeals in Boston, Puerto Rico argued the law represented an "emergency response to the most profound fiscal crisis in Commonwealth history."
The filing said unilateral action by creditors such as accelerating PREPA's debt repayments, suing to raise electricity rates, or seeking to appoint a receiver would "disrupt the provision of essential public services in Puerto Rico."
"It is always extraordinary for a federal district court to invalidate a statute on federal constitutional grounds, but it is especially extraordinary to invalidate this statute," Puerto Rico said in the filing.
The Recovery Act was enacted quickly in June 2014 over concerns that the Puerto Rico Electric Power Authority (PREPA) would default on over $9 billion in debt.
The law was challenged by PREPA's bondholders, including funds run by Oppenheimer Funds, a unit of insurer MassMutual Financial Group, and Franklin Templeton. The hedge fund Blue Mountain Capital Management LLC also challenged the law.
Together the funds hold over $2 billion of PREPA's revenue bonds. They argued that Puerto Rico did not have the right to create its own bankruptcy law. The judge ruled that the Recovery Act was unconstitutional because it contradicted federal bankruptcy law.

(Reporting by a contributor in San Juan; editing by Andrew Hay)
UPDATE 1-Puerto Rico asks for quick decision in bankruptcy ruling appeal

Comments

Post a Comment

Popular posts from this blog

IMF Executive Board Discusses the First Assessment of Eligible Countries under the Multilateral Debt Relief Initiative

On December 21, 2005 the Executive Board of the International Monetary Fund (IMF) established the list of countries that qualify for debt relief from the Fund under the Multilateral Debt Relief Initiative (MDRI). Debt relief delivery, which could start as soon as January 3, 2005, is now conditional on getting the consents of all the contributors to the Subsidy Account of the Poverty Reduction and Growth Facility (PRGF) Trust, whose contributions help finance the Initiative. The MDRI will deliver debt relief from the Fund to qualifying members countries with an annual per capita income at or below US$380, and to countries above the threshold that have reached the completion point under the Heavily Indebted Poor Countries (HIPC) Initiative. The implementation of the MDRI will reduce the external debt burden of a number of the world's poorest countries and will provide additional resources to help them reach the Millennium Development Goals (MDGs). Background The Executive Board appro...
Read more

Oil’s chaotic collapse deepens; stocks drop worldwide

Image
NEW YORK (AP) — Oil prices crumpled even further Tuesday, and U.S. stocks sank to their worst loss in weeks as worries swept markets worldwide about the economic carnage caused by the coronavirus pandemic. The market’s spotlight was again on oil, where prices have plummeted because very few people are flying or driving, and factories have shut amid widespread stay-at-home orders. Global demand is set to drop to levels last seen in the mid 1990s. At the same time, oil producers can’t slow their production fast enough, and all the extra crude means storage tanks are quickly running out of room. The cost for a barrel of U.S. oil to be delivered in June plunged 43% to $11.57. That’s the part of the market that oil traders are focused on and trading most actively. For oil to be delivered next month, which is when storage tanks could top out, the cost of a barrel stood at $10.01. A day earlier, it fell below zero for the first time, meaning traders paid others to take oil off their hand...
Read more

Mapping Extreme Poverty Around the World A new report from the

Image
A new report from the  World Bank  just landed, finding that a record low of 10% of humanity now live in extreme poverty, down from 11% in 2013. But poverty rates aren’t anywhere close to equal between continents or even countries, as our new series of maps clearly demonstrates. The World Bank provides an in-depth explanation for its methodology, which you can find in Appendix A of the full report  here . We focused on the percentage of people in each country living below what the World Bank defines as extreme poverty, or $1.90/day. We’ll let the researchers defend this definition on their own, but there is one caveat to keep in mind. It can be extraordinarily difficult to collect reliable data from so many countries on a regular basis, and in fact we used the latest year in which numbers were available whenever possible. For example, in some of these maps we compare 2011 figures against 2015. In short, our maps provide the clearest possible apples-to-apples compa...
Read more