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I know that all debts, including foreign debts, have to be declared when filing for bankruptcy in the US.

I am wondering what effect this has on foreign debts. My thinking is that it doesn't 'cancel' them, and they will still be valid in the country of origin, but they won't be able to be sued for or collected in the US.

Is this correct?

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There isn't one answer. Each country has to decide under its own domestic laws what effect to give to a U.S. bankruptcy court judgment.

Many countries in the world will give full legal effect to a dispute between private parties over money or property resolved by any court that has what the court asked to honor the foreign court order determines to be a legitimate basis for jurisdiction over the parties and/or the property in question. But if they don't, there is little that U.S. authorities can do about it in most cases.

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  • Right, it would depend on the international private law of the respective foreign jurisdictions. For example: • The foreign jurisdiction might not recognize the US bankruptcy at all and require a domestic bankruptcy proceeding. • The foreign jurisdiction might consider the foreign bankruptcy proceeding a violation of its ordre public if the debtor would be elligible for a domestic bankruptcy. – erebus Apr 9 at 10:52
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A US bankruptcy establishes a plan to hold off creditors and protect some of your assets, for creditors and assets within the jurisdiction of that US bankruptcy court. Your assets in another location are probably not protected. Your creditors elsewhere would be bound by US law for their actions in the US, your assets in the US would be under control of the US court, but your assets outside the US (eg the bank account in Panama or the vacation house in Mali) would be subject to creditors acting under whatever local laws apply.

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  • Will bankruptcy protect foreign creditors attempting to collect US assets in the US for a foreign debt, if the foreign debt is declared in the US bankruptcy? Maybe that's a better way of phrasing my question. – David Randolph Oct 4 '20 at 10:03
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    Please, add references. At the moment this is an unsupported opinion. – grovkin Mar 8 at 11:23
  • There is not a reference for this. It is the rules of court jurisdiction. Every court has limits on its authority. – J. Win. Mar 21 at 22:34

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