Conciliation as Method to Solve Sovereign Debt Disputes Between States and Private Creditors

States’ financial instability and debt restructuring could be impaired by predatory behaviors of private creditors, including entities that buy distressed sov- ereign bonds with the aim of litigating and recovering inflated sums. Scholars have suggested a wide-range of normative solutions to alleviate these problems, including the creation of a multilateral international sovereign bankruptcy framework and the institution of dedicated arbitral tribunals or international courts. Conciliation could provide an alternative to judicial and investor-state dispute settlement (ISDS) pro- ceedings to solve disputes involving sovereign debt between private creditors and debtor States because of its procedural and practical benefits. The flexibility of the procedure, the reduced amount of time and costs, the recourse to equity and legal principles favour such mechanism over other dispute resolution procedures. It is therefore proposed to create a compulsory “conciliation scheme” managed by the United Nations Conference on Trade and Development (UNCTAD) Sovereign Debt Workout Institution in order to create a reliable system for the resolution of sovereign debt disputes