A game theory analysis of China's maritime cross-border insolvency policy: from the perspective of Hanjin shipping's bankruptcy case

Financial difficulties experienced within the shipping industry have caused an increasing number of maritime cross-border insolvencies. The UNCITRAL Model Law on Cross-Border Insolvency (the Model Law) is designed to assist countries in equipping their insolvency laws with a modern framework that more effectively addresses cross-border insolvency proceedings. This paper discusses whether China should adopt the Model Law, using the method of strategic game theory based on the Hanjin Bankruptcy case. Our results show that, from the perspective of a mathematical evaluation, China should not adopt the Model Law, since Hanjin declared bankruptcy with South Korea's adoption already having taken place. Even if the Model Law is adopted, its application in China will be very limited due to the structure of Chinese shipping enterprises.