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The article focuses on the efforts that can be made to ensure the traditional legal balance between the sovereign debtors and their commercial creditors is restored. The traditional US practice permits each bondholder to sue for its share of a payment that was not made on a scheduled maturity date. Full centralization of enforcement powers in the hands of the trustee will prevent states from buying debt they have defaulted on. The principal motivation for these documentary changes was a desire to replicate the supermajority creditor control of debt workouts that exists in most corporate insolvency regimes.

The article presents information on pari passu clause, a provision that appears in most cross-border credit instruments. The Latin phrase pari passu means in equal step or just equally. The phrase pari passu was often used in equity jurisprudence to express the ratable interest of parties in the disposition of equitable assets. The ratable-payment interpretation suggests that the phrase this bond shall rank pari passu in priority of payment with all of the borrower's other debts constitutes an enforceable promise not to pay other debts while this bond is in default. In April 2003, Kensington International Ltd., a creditor of the Republic of the Congo, sought summary judgment in London, England on a money claim against Congo-Brazzaville, as well as an order from the High Court in London restraining the defendant from paying its other creditors without making a pro rata payment to Kensington. The legal basis for the requested order was a pari passu clause in a loan agreement.