Conservative leader David Cameron has stated that his party will commit to introducing US-style Chapter 11 rules aimed at guarding companies from economic slumps and reducing the risk of insolvency, should they win the next general election.

According to the leader of the opposition, the current insolvency system fails to offer sufficient protection to businesses struggling amid economic downturns, meaning many more could go under within the next couple of years as banks call in loans and refuse to give out more credit.

"The credit crunch has meant more companies are finding it hard to get the money they need to keep their business alive," Mr Cameron is expected to tell the Confederation of British Industry (CBI).

"And we all know what liquidation means - job losses. This isn't right for the companies which are fundamentally sound, nor for the banks who lend these companies money, nor for its employees who are being laid off."

Over the past few months, a number of business leaders have also called for an overhaul of the existing insolvency laws, with many feeling that, as corporate restructurings become more complex, a court-supervised predictable process is becoming increasingly necessary.