In a long awaited landmark judgment, The European Court of Justice has today found in favour of ten former Waterford Crystal workers who alleged the Irish State had failed in their obligations to correctly implement European Directive 2008/94EC ('The Directive’) on the protection of employees in the event of the insolvency of their employer.

The EU Court of Justice held that Directive 2008/94/EC of the European Parliament and of the Council of 22 October 2008 (“Directive 2008/94”) applies to pension benefits under a supplementary pension scheme, regardless of the cause of the employer’s insolvency, and without taking into account state pension benefits. Directive 2008/94 provides that member states must protect the pension interests of retirees when an employer becomes insolvent.

The Minister for Justice Equality and Law Reform has published the European Communities (European Order for Payment) Regulations 2008 . The Regulations are effective from 12 December 2008.

The Regulations set out the effect on domestic legislation of Regulation 1896/2006 creating a European Order for payment procedure. The Regulations amend Section 25 of Courts and Court Officers Act 1995. The Master of the High Court is designated as the authority through which the procedures will operate in this jurisdiction.

The Court interpreted the terms of a Termination Agreement and found that the Applicant, Europa, was entitled to €1.3 million from the Defendant, AII, in relation to funds invested on Europa's behalf, which had been paid out and held by AII. As a matter of construction, it could not have been intended that AII should be left with sums owing to an investor following a Termination Agreement.

The Gibraltar Financial Services Commission has announced the appointment of independent inspectors to investigate the insolvency of Enterprise Insurance Company plc and the conduct of its directors and auditors. The company had a large exposure in Ireland having sold motor insurance to Irish consumers.

The Central Bank's update is available here.

David Baxter and Brian O’Malley, A&L Goodbody

This is an extract from the first edition of GRR's The Art of the Pre-Pack. The whole publication is available here.

Introduction

Pre-packs in Ireland probably are not as common as they should be. In theory, a pre-pack is broadly available in each of our insolvency procedures: liquidation, examinership and receivership.

The Revenue Commissioners have issued some recent welcome clarifications about certain provisions of the Government's temporary wage subsidy scheme.

Application for the Subsidy Scheme – An Admission of Insolvency?

The main provisions of the subsidy scheme are set out in Section 28 of the Emergency Measures in the Public Interest (Covid-19) Act 2020.

That section also contains the criteria for an employer's eligibility to avail of the subsidy scheme. One such criterion is that:

About a year ago, I completed the most exhausting marathon of my life serving as the chief lawyer during the cross-border restructuring and chapter 11 of Waypoint Leasing, an Ireland-based helicopter leasing company. I joined Waypoint Leasing shortly after it started operations in the newly formed helicopter leasing industry. After the first few years of meteoric growth, the collapse in oil & gas prices hit the helicopter industry hard. We soon found ourselves dealing with bankrupt customers and eventually reached the brink of financial distress ourselves.

Following our articles on:

Some businesses may soon (and indeed already) be faced with sudden cash flow and liquidity issues as a result of the sudden economic disruption caused by the COVID-19 pandemic.

Some of these businesses may be well advised to first seek to renegotiate arrangements with creditors whilst others may require formal court protection from creditors to assist them while arrangements with creditors are being put in place.

The three main legal avenues which are available to businesses seeking to restructure their debt under Irish law are as follows: