pari passu

Pari passu is a Latin term meaning "equally" or "on equal footing." In finance and legal contexts, it refers to a situation where multiple parties have the same rights or status, especially in the distribution of assets or payments. For example, if a company is liquidated and has debts, creditors who are pari passu will receive payments simultaneously and proportionately, without any one creditor getting priority over the others. This principle ensures fairness among stakeholders, emphasizing that all eligible parties share equally in the available resources or benefits.