Bankruptcy Code Law and Legal Definition

Bankruptcy Code is the informal name for Title 11 of the United States Code Service (11 USCS §§ 101-1330), the federal bankruptcy law. It may also refer to Bankruptcy in China, Bankruptcy in Canada, and Bankruptcy in the United Kingdom. Under Bankruptcy code Chapter 7 deals with liquidation. Liquidation involves appointment of a trustee for collecting, selling and distributing the proceeds of a debtor’s non-exempt property to the creditors. Chapter 9 of the Bankruptcy Code deals with reorganization for municipalities. Chapter 11, Chapter 12, and Chapter 13 of the Bankruptcy Code deals with more complex reorganization and it allows the debtor to keep some or whole of his/her property and to adjust the future earnings to pay off the claim of his/her creditors. Chapter 15 of the Bankruptcy Code deals with cross border insolvency.