Consumer bankruptcy regimes in the US and Europe: further effects and implications of the crisis

Consumer insolvency is a topic that has gained much prominence in the context of the financial crisis on both sides of the Atlantic. The number of bankruptcy filings has soared in recent years, and is not expected to go down in the near future. This CEPS Working Document explains the consumer bankruptcy procedures in the US and five European countries with quite different approaches: the UK, Ireland, Germany, France and Spain. Since there is no law on consumer insolvency in Italy, the situation in this country is outlined only briefly. When considering current statistics on consumer bankruptcies so far, the first effects of the economic crisis can be observed, so the question arises as to what is yet to come and which bankruptcy procedures are the most appropriate. After a short presentation of each insolvency procedure, the developments in national bankruptcy numbers are traced, highlighting striking developments in the different countries studied here.