Relevant:
- Puerto Rico Faces Record $2B Default July 1st: A Look at the Bonds Due
- Puerto Rico requests bankruptcy protection for public debt (LARGEST IN HISTORY)
- Puerto Rican bankruptcy debate divides U.S. politicians down party lines
- Plan to Rescue Puerto Rico Advances, Led by House Republicans
- High Court Takes up Puerto Rico Debt Restructuring Case
2015-06-30 — wsj.com
The island's unique territorial status also means it lacks the legal tools available to U.S. municipalities or foreign countries to restructure its debt. As a commonwealth, it is excluded from Chapter 9 of the U.S. bankruptcy code, though the island has been working to change that. Nor can it devalue its currency--the U.S. dollar--or seek assistance from the IMF.
A federal judge earlier this year voided a local law that would have cleared a path to restructuring for public authorities, including the electric utility. A bill introduced in Congress would permit the island to let those entities access Chapter 9 protections, but it hasn't moved anywhere and faces opposition from hedge-fund creditors and some conservative Republicans.
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