I am course director for the advanced course Credit and Financial Market Law. The course is given every fall. In addition, I supervise papers within my area of expertise and lecture on the topic of sustainable finance.  

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• Prioritet och avtal: Intercreditoravtal i svensk rätt, särskilt vid insolvens

  2023. Sara Göthlin.

  Thesis (Doc)

  An intercreditor agreement is a contract between two or more creditors in relation to a common debtor. It regulates, among other things, the priority of payment and the distribution of proceeds from the enforcement of security. Intercreditor agreements are widely used in corporate finance transactions, in connection with private as well as public loan issuance.  

  The main aim of the thesis is to clarify under which circumstances, if any, agreements whereby a creditor is subordinated towards one or more other creditors are effective in the bankruptcy of either the borrower or a junior creditor. It is suggested that the ranking of claims be analysed as falling into one of two main types of legal construction. First, it is possible to construe the transaction as a transfer or pledge of rights over a junior creditor’s claim, or its claim on future dividends in the debtor’s bankruptcy. Second, it is possible that an agreement to subordinate in favour of one or more other creditors should be understood as a condition for repayment, making the junior claim conditional on the discharge of the senior debt. The thesis concludes that a receiver in bankruptcy should, as a main rule, observe a waterfall that certain creditors and the debtor have agreed ex ante. The same principle should apply in formal company reorganization proceedings. 

  The conclusions are supported by a legal analysis carried out in Part III of the thesis. Further, such interpretation is in line with the normative framework set out in Part II of the thesis, which emphasises the interest of legal certainty and the upholding of pre-bankruptcy entitlements. In addition, the ongoing harmonisation of financial markets and insolvency law that is taking place on the EU level indicates the need to find paths under Swedish law that are consistent with international developments. 

  The final chapter of Part III includes an analysis of the function of an agent as representative of a group of creditors under Swedish law. It is suggested that this is an area where the legislator should intervene without delay. Especially, the market would benefit from certainty concerning the right of an agent to represent creditors in court proceedings, and the enforceability of non-action undertakings of individual creditors. Importantly, if an agent is able to collect funds from a common borrower in and outside of bankruptcy, an agreed waterfall would become enforceable in practice. 

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