This eighth edition of The Insolvency Review once again offers an in-depth review of market conditions and insolvency case developments in key countries. A debt of gratitude is owed to the outstanding professionals around the globe who have dedicated their time and talents to this book. As always, their contributions reflect diverse viewpoints and approaches, which in turn reflect the diversity of their respective national commercial cultures and laws.

This year's book is being published as the world continues to cope with the covid-19 pandemic. Some countries are more affected than others but one thing is clear: in addition to the tragic impact of the pandemic on the lives and health of so many around the world, the economic hardship on individuals and businesses is extensive. This impact goes well beyond those directly affected by the virus. In many countries, lockdowns have affected a number of economic sectors. Airlines, hospitality, entertainment, dining and retail, just to name a few, have seen their revenues collapse and enormous numbers of jobs lost. The impact on employees in these sectors has been tragic, and the effect on consumers has rippled through other sectors as well. Governmental stimulus efforts have cushioned some of this impact but even so we are now seeing record numbers of business failures. These numbers will only grow until the pandemic is under control.

As can be seen in these pages, insolvency professionals and courts are coping with the resulting onslaught of business insolvencies to the best of their ability. Still, efforts to rescue and restructure businesses and save jobs are of no avail if revenues cannot timely be restored. Insolvency proceedings can be a holding action, but they cannot create revenue to allow a business to survive. The insolvency system then becomes merely an orderly means of shutting businesses down and distributing their assets.

One question to ask is whether, where businesses revenues collapse owing to an exogenous event such as a pandemic, the fact that investors and employees in some economic sectors absorb losses and hardships that are disproportionate to those in other sectors is not highly arbitrary. Some cogently argue that these costs, which are imposed by actions taken by governments, businesses and individuals to protect the public's health and wellbeing, should be absorbed by the public sector and allocated through tax policy rather than having them absorbed by the unlucky employees and stakeholders of the affected businesses.

Another question is whether allowing the collapse of these businesses, which were viable before the pandemic, will not also make the return to normal more difficult after the worst is behind us. Rather than idling for a while and then resuming, the affected economic engines are being shut down. Their lights are literally going out. Over the long run, will it be more time-consuming and costly to reconstruct these economic engines anew, and then crank them up and restart them, than it would be to support them so they can idle for a time and then resume in their current form?

Of course, for businesses to remain intact they must be provided with liquidity and capital, and programmes have been adopted in a number of countries to provide this, at least temporarily. Payment moratoria also have played a role in some countries, though these moratoria inevitably force some of the costs onto private sector parties (for example, landlords).

Frankly, there may be no good answers to these questions.

Next year, we may be in a better position to assess the economic damage done by the pandemic and how successful countries have been in preserving their business infrastructure, restoring employment and mitigating the arbitrary impacts described above. In the meantime, it is up to the insolvency system to take up the slack as best it can. I know that insolvency professionals, especially the authors contributing to this volume, are up to the task.

As I do each year, I want to thank each of the contributors to this book for their efforts to make The Insolvency Review a valuable resource. As each of our authors knows, this book is a challenging undertaking every year, and particularly so in this year of covid-19. As in previous years, my hope is that this year's volume will help all of us, authors and readers alike, reflect on the larger picture, keeping our eye on likely, as well as necessary, developments, on both the near and distant horizons.

Donald S Bernstein
Davis Polk & Wardwell LLP
September 2020