---
kind: "section"
citation: "11 U.S.C. § 1501"
title: "11"
title_heading: "Bankruptcy"
number: "1501"
heading: "Purpose and scope of application"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/11/1501"
units:
  - "Chapter 15 — Ancillary and Other Cross-Border Cases"
---

# §1501. Purpose and scope of application

- (a) The purpose of this chapter is to incorporate the Model Law on Cross-Border Insolvency so as to provide effective mechanisms for dealing with cases of cross-border insolvency with the objectives of—
  - (1) cooperation between—
    - (A) courts of the [United States](/usc/11/101.md?p=55), [United States](/usc/11/101.md?p=55) [trustees](/usc/11/1502.md?p=6), [trustees](/usc/11/1502.md?p=6), examiners, [debtors](/usc/11/1502.md?p=1), and [debtors](/usc/11/1502.md?p=1) in possession; and
    - (B) the courts and other competent authorities of foreign countries involved in cross-border insolvency cases;
  - (2) greater legal certainty for trade and investment;
  - (3) fair and efficient administration of cross-border insolvencies that protects the interests of all [creditors](/usc/11/101.md?p=10), and other interested [entities](/usc/11/101.md?p=15), including the [debtor](/usc/11/1502.md?p=1);
  - (4) protection and maximization of the value of the [debtor](/usc/11/1502.md?p=1)’s assets; and
  - (5) facilitation of the rescue of financially troubled businesses, thereby protecting investment and preserving employment.
- (b) This chapter applies where—
  - (1) assistance is sought in the [United States](/usc/11/101.md?p=55) by a [foreign court](/usc/11/1502.md?p=3) or a [foreign representative](/usc/11/101.md?p=24) in connection with a [foreign proceeding](/usc/11/101.md?p=23);
  - (2) assistance is sought in a foreign country in connection with a case under this title;
  - (3) a [foreign proceeding](/usc/11/101.md?p=23) and a case under this title with respect to the same [debtor](/usc/11/1502.md?p=1) are pending concurrently; or
  - (4) [creditors](/usc/11/101.md?p=10) or other interested [persons](/usc/11/101.md?p=41) in a foreign country have an interest in requesting the commencement of, or participating in, a case or proceeding under this title.
- (c) This chapter does not apply to—
  - (1) a proceeding concerning an [entity](/usc/11/101.md?p=15), other than a foreign insurance company, identified by exclusion in [section 109(b)](/usc/11/109.md?p=b);
  - (2) an individual, or to an individual and such individual’s spouse, who have [debts](/usc/11/101.md?p=12) within the limits specified in [section 109(e)](/usc/11/109.md?p=e) and who are citizens of the [United States](/usc/11/101.md?p=55) or aliens lawfully admitted for permanent residence in the [United States](/usc/11/101.md?p=55); or
  - (3) an [entity](/usc/11/101.md?p=15) subject to a proceeding under the [Securities](/usc/11/101.md?p=49) Investor Protection Act of 1970, a [stockbroker](/usc/11/101.md?p=53A) subject to subchapter III of [chapter 7](/usc/11/chch7.md) of this title, or a [commodity broker](/usc/11/101.md?p=6) subject to subchapter IV of [chapter 7](/usc/11/chch7.md) of this title.
- (d) The court may not grant relief under this chapter with respect to any deposit, escrow, trust fund, or other [security](/usc/11/101.md?p=49) required or permitted under any applicable [State](/usc/11/101.md?p=52) insurance law or regulation for the benefit of [claim](/usc/11/101.md?p=5) holders in the [United States](/usc/11/101.md?p=55).

## Source credit

(Added Pub. L. 109–8, title VIII, § 801(a), Apr. 20, 2005, 119 Stat. 135.)

## Notes

### Editorial Notes

### References in Text

The Securities Investor Protection Act of 1970, referred to in subsec. (c)(3), is Pub. L. 91–598, Dec. 30, 1970, 84 Stat. 1636, which is classified generally to chapter 2B–1 (§ 78aaa et seq.) of Title 15, Commerce and Trade. For complete classification of this Act to the Code, see section 78aaa of Title 15 and Tables.

### Prior Provisions

A prior section 1501, Pub. L. 95–598, Nov. 6, 1978, 92 Stat. 2652, related to applicability of chapter which provided a pilot program for a United States trustee system, prior to repeal by Pub. L. 99–554, title II, § 231, Oct. 27, 1986, 100 Stat. 3103.

### Statutory Notes and Related Subsidiaries

### Effective Date

Section effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as an Effective Date of 2005 Amendment note under section 101 of this title.