Developing Country Debt (Restriction of Recovery) Bill

The Bill seeks to regulate the recovery of sovereign debts of developing (low and middle income) countries that have defaulted on their external debt. It targets ‘vulture funds’, which buy up defaulted sovereign debt at a discounted rate then attempt to recover the full amount, including fees, through the courts. The Bill would:

• limit the maximum recoverable amount to that initially paid for the debt, plus interest or charges as specified in the Bill
  
• introduce reporting requirements, with institutions requiring UK courts’ permission (copied to the UK Government and UK-based representative of the country concerned) before recovery proceedings for defaulted debt can begin
  
• require institutions to disclose beneficiaries of recovery proceedings
  
• require a vulture fund to declare payments or gifts given by it or its colleagues to the developing country’s Government.