In law, a moratorium (from Latin morari, to delay) is a legal authorization postponing for a specified time the payment of debts or obligations. The term is also sometimes used to mean the period over which the indulgence or period of grace stretches, the authorization itself being called a moratory law. A moratory law is usually passed in some special period of political or commercial stress; for instance, on several occasions during the Franco-German War the French government passed moratory laws. Their international validity was discussed at length, and upheld in the English law case Rouquette v Overman (1875) LR 10 QB.

Proponents of a debt moratorium argue that it is a sovereign decision by the government of a nation to suspend payment of debt to its creditors, in the event that to do otherwise would do irreparable harm to the welfare of its citizenry. A debt moratorium may take the form of a complete cessation of debt payments, or a partial cessation; for example, the government of President Alan Garcia of Peru implemented the so-called "Ten Per Cent Solution", where it was announced that only 10 per cent of export earnings would go to debt payment. Any form of debt moratorium is generally opposed by the International Monetary Fund. In 1976, Foreign Minister of Guyana Frederick Wills made a speech before the United Nations General Assembly, calling for a general moratorium on Third World debt.

Other nations which have, at one time or another, declared a debt moratorium, are Brazil, Mexico and

Moratorium in the entertainment business

Moratorium is also referred to as the practice of suspending the sales of DVD movies or DVD boxed sets after a certain period of time. The Walt Disney Company practises Moratorium more than any other production company, and is often practiced with releases of classic animated movies in the Disney catalog. Former Disney CEO Michael Eisner is the person responable for the pratice of Moratorium at Disney.

Disney is not the only one that practises Moratorium. Universal Pictures used this practice with the release of the Back to the Future DVD boxed set, and LucasArts used this practice with the Star Wars DVD boxed set, however Moratorium has be rumored to be lifted on Back to the Future for a 20th Anniversay Edition of the Boxed Set, however the reports are unconfirmed at this time.

The practice of Moratorium is severly frowned upon by consumers because it forces higher sale prices. A normal DVD that is sold under Moratorium, can sell for as high as $40 US dollars. However, prices are known to drop near the end of the issue. A case in point, the original shipment of the Back to the Future DVD boxed set, sold at retail for $50 US Dollars. After a second shipment was ordered to fill the demand, and to fix the flaws in the first shipment, the price was reduced to $25 US Dollars and this shipment was sold for only seven days before Universal Pictures put the set in Moratorium status.


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