(a) A case ancillary to a foreign proceeding is commenced by the 
filing with the bankruptcy court of a petition under this section by a 
foreign representative.
    (b) Subject to the provisions of subsection (c) of this section, if 
a party in interest does not timely controvert the petition, or after 
trial, the court may--
        (1) enjoin the commencement or continuation of--
            (A) any action against--
                (i) a debtor with respect to property involved in such 
            foreign proceeding; or
                (ii) such property; or

            (B) the enforcement of any judgment against the debtor with 
        respect to such property, or any act or the commencement or 
        continuation of any judicial proceeding to create or enforce a 
        lien against the property of such estate;

        (2) order turnover of the property of such estate, or the 
    proceeds of such property, to such foreign representative; or
        (3) order other appropriate relief.

    (c) In determining whether to grant relief under subsection (b) of 
this section, the court shall be guided by what will best assure an 
economical and expeditious administration of such estate, consistent 
with--
        (1) just treatment of all holders of claims against or interests 
    in such estate;
        (2) protection of claim holders in the United States against 
    prejudice and inconvenience in the processing of claims in such 
    foreign proceeding;
        (3) prevention of preferential or fraudulent dispositions of 
    property of such estate;
        (4) distribution of proceeds of such estate substantially in 
    accordance with the order prescribed by this title;
        (5) comity; and
        (6) if appropriate, the provision of an opportunity for a fresh 
    start for the individual that such foreign proceeding concerns.

(Pub. L. 95-598, Nov. 6, 1978, 92 Stat. 2560.)


                      Historical and Revision Notes

                         legislative statements

    Section 304(b) adopts a provision contained in the Senate amendment 
with modifications. The provision indicates that if a party in interest 
does not timely controvert the petition in a case ancillary to a foreign 
proceeding, or after trial on the merits, the court may take various 
actions, including enjoining the commencement or continuation of any 
action against the debtor with respect to property involved in the 
proceeding, or against the property itself; enjoining the enforcement of 
any judgment against the debtor or the debtor's property; or the 
commencement or continuation of any judicial proceeding to create or 
enforce a lien against the property of the debtor or the estate.
    Section 304(c) is modified to indicate that the court shall be 
guided by considerations of comity in addition to the other factors 
specified therein.


                        senate report no. 95-989

    This section governs cases filed in the bankruptcy courts that are 
ancillary to foreign proceedings. That is, where a foreign bankruptcy 
case is pending concerning a particular debtor and that debtor has 
assets in this country, the foreign representative may file a petition 
under this section, which does not commence a full bankruptcy case, in 
order to administer assets located in this country, to prevent 
dismemberment by local creditors of assets located here, or for other 
appropriate relief. The debtor is given the opportunity to controvert 
the petition.
    Subsection (c) requires the court to consider several factors in 
determining what relief, if any, to grant. The court is to be guided by 
what will best assure an economical and expeditious administration of 
the estate, consistent with just treatment of all creditors and equity 
security holders; protection of local creditors and equity security 
holders against prejudice and inconvenience in processing claims and 
interests in the foreign proceeding; prevention of preferential or 
fraudulent disposition of property of the estate; distribution of the 
proceeds of the estate substantially in conformity with the distribution 
provisions of the bankruptcy code; and, if the debtor is an individual, 
the provision of an opportunity for a fresh start. These guidelines are 
designed to give the court the maximum flexibility in handling ancillary 
cases. Principles of international comity and respect for the judgments 
and laws of other nations suggest that the court be permitted to make 
the appropriate orders under all of the circumstances of each case, 
rather than being provided with inflexible rules.

                  Section Referred to in Other Sections

    This section is referred to in sections 101, 305, 306 of this title; 
title 28 section 1410.