Hong Kong’s retail sales fell by a record 44% in February from a year earlier, as travel restrictions kept tourists away and residents avoided shopping centres to prevent the spread of the coronavirus, Reuters reported. The spending drought has hit an economy already in recession after months of often-violent anti-government protests. Retail sales in February fell 44% from a year earlier to HK$22.7 billion ($2.93 billion), compared with a revised 21.5% drop in January, government data showed on Tuesday.
Brazil’s largest fixed-line carrier Oi SA has kicked off a renewable energy project that will cut its operating costs by 400 million reais ($77.09 million) per year, the company said on Tuesday, Reuters reported. The initiative is part of Oi’s efforts to gain efficiency as it strives to revamp its business since filing for bankruptcy protection in June 2016. The renewable project, which involves 25 solar, biomass and hydroelectric mills totaling 123 megawatts in capacity, follows the so-called “distributed generation” model, in which Oi buys clean energy at lower prices.
The head of the eurozone’s bailout fund said it would take between one and three years to set up a new European institution to issue so-called coronabonds, the Financial Times reported. Any extra joint debt issuance would in the short term have to come from existing mechanisms. With political temperatures rising over calls for euro area governments to collectively issue bonds to tackle the coronavirus pandemic, Klaus Regling, the managing director of the European Stability Mechanism, said European institutions have already issued more than €800bn of mutual debt in aggregate.
Spain offered more help to households and small companies on Tuesday to try to calm fears about the country’s mothballed economy and shield the population from losing their homes during the coronavirus lockdown, Reuters reported. Infections and deaths from the virus are still rising, but health officials said the pace had slowed in the past few days. Confirmed cases rose by about 11% to 94,417 and the death toll hit 8,189 after 849 fatalities were reported overnight.
Irish medical diagnostic company Trinity Biotech has booked a $24.4 million (€22.2 million) non-cash impairment charge, is closing a facility in California and is exiting two markets in which it operates, The Irish Times reported. In more positive news, however, the group also said it was close to completing a test to quickly detect Covid-19, and developing a second test that will indicate who has immunity. The Nasdaq-listed group on Tuesday announced a 6.8 per cent decline in 2019 revenues to $9.4 million.
The doomsday predictions have started. The Economic and Social Research Instiute (ESRI) last week forecast the Irish economy could shrink by 7 per cent in 2020 and that we could have 350,000 job losses as a result of coronavirus-triggered shutdown, The Irish Times reported. However, this was based on the restrictions lifting within 12 weeks. EY Ireland upped the ante yesterday by suggesting the hit could be as big as 13 per cent if the shutdown extends over a more prolonged period to August.
Critics have accused the Netherlands of jeopardising the future of the European Union with its strident opposition to joint debt issuance in response to appeals for solidarity to deal with the fallout from the pandemic, The Irish Times reported. Dutch finance minister Wopke Hoekstra wrote that issuing joint debt in the form of so-called coronabonds or eurobonds risked undermining “incentives for sensible policy”: the so-called moral “hazard argument” familiar from the last euro-zone crisis that countries with more debt should essentially learn from their mistakes.
The European Commission has approved a €200 million State scheme to provide loans to Irish manufacturing or exporting businesses that are struggling during the Covid-19 restrictions, The Irish Times reported. Margrethe Vestager, the competition commissioner, gave the green light to the scheme, which she said would “help companies affected by the coronavirus outbreak to weather this crisis and bounce back strongly afterwards”.
Abu Dhabi-based Gulf Marine Services (GMS) said on Tuesday it had reached an agreement with its syndicate of banks to restructure its debt that will help it weather the coronavirus crisis, gCaptain reported. London-listed GMS provides support vessels for offshore oil and gas and other energy installations. It has been hurt by a downturn in the oil and gas services industry triggered by a prolonged slide in oil prices that has turned into a deep slump since the coronavirus crisis destroyed demand and a production cut agreement between OPEC and its allies collapsed.
German officials expect unemployment in Europe’s largest economy to rise sharply as a consequence of the coronavirus crisis, even though hundreds of thousands of companies have applied for their staff to join a government-subsidised short-term work programme designed to avoid lay-offs, the Financial Times reported.
Resources by Country & Region
William Fry recently advised Ballantyne Re plc (“Ballantyne”), an Irish reinsurance SPV, on an Irish law scheme of arrangement to restructure its reinsurance obligations and outstanding New York law governed indebtedness, such that the residual value in the company could be distributed to its senior noteholders (the “Scheme”).
An international multi-disciplinary approach to combatting fraud in insolvency by Carmel King & Willem van Nielen
An international multidisciplinary approach to combatting fraud in insolvency is a practical necessity. Where cases are multi-jurisdictional, it is essential to use innovative approaches with input across several disciplines. The INSOL Europe Anti-Fraud Forum (“AFF”) was established with this as one of its aims. This working group currently has 69 members spanning 22 jurisdictions, all of whom specialise in using insolvency processes to assist with the tracing and recovery of assets.
Coordinating the Preventive Restructuring Directive and the Recast European Insolvency Regulation by Lorenzo Stanghellini and Andrea Zorzi
Issues arising from coordination among possible cross-border procedures seem underestimated in the Directive on Preventive Restructuring Frameworks (the “Directive”). The Directive purports to be almost indifferent to the Recast European Insolvency Regulation (“Recast EIR”).
The brand new Directive on Preventive Restructuring Frameworks (EU No 2019/1023 of 20 June 2019) presents a promising toolbox for restructuring debtor companies, containing features such as a very early starting point, the debtor-in-possession approach, a flexible stay, the restructuring plan’s adoption out-of-court and the cross-class cram-down.
This updated edition describes the framework of the European Insolvency Regulation Recast (adopted in June 2017), reviews its major rules, highlights the differences from the old EIR 2000, and makes references to the most important and recent cases of the Court of Justice of the European Union. An essential guide for non-European judges, practitioners and scholars who are confronted with this domain of law, as well as anyone dealing with EU-related cross-border cases, this book serves as a concise and comprehensive introduction to the EIR Recast.
Chapter 15 for Foreign Debtors covers all aspects of the UNCITRAL Model Law on Cross-Border Insolvency as well as chapter 15 of the Bankruptcy Code, and provides details about the Foreign Representative, avoidance actions, creditor protections, concurrent proceedings, comity and much more. The book also includes an extensive appendix filled with more than 500 pages of sample case documents and forms related to chapter 15 proceedings.
This book is the latest addition to our list of publications and it provides basic information on Islamic finance. It is meant to be a useful reference tool to the majority of insolvency practitioners who do not work in this field. The chapters in this book were selected on the basis that it is expected that most INSOL members currently have very limited understanding of Islamic finance.
The book has 10 chapters, a country study, and an annexure with a glossary of Islamic finance terms. Following the introductory chapter there are chapters on: