On Friday 7 October 2016, McCullough Robertson successfully obtained orders on behalf of a US Chapter 7 bankruptcy trustee, requiring payment to her of money held by the Public Trustee of Queensland (Public Trustee) on behalf of a US bankrupt and her former husband. As far as we know, this is the first time that the Model Law on Cross-Border Insolvency (Model Law) has been used in Australia to obtain an order allowing the repatriation of funds to a foreign representative that are not the foreign debtor’s assets.
Judge Chapman’s judgment is obviously a welcome development for participants in the structured capital markets, particularly those who transact regularly with US counterparties.
This week’s TGIF considers Legend International Holdings Inc (In Liquidation) v Indian Farmers Fertiliser Cooperative Ltd & Kisan International Trading FZE [2016] VSCA 151 in which it was held that s 581 does not prohibit a winding up order where Chapter 11 proceedings are on foot.
What happened?
FI and D&O Since our last update, there have been significant developments in the FI and D&O landscape. November saw the first ever UK deferred prosecution agreement (DPA) announced between the SFO and Standard Bank. The DPA process has been available but unused since 2014 so the judgment and the SFO’s comments thereafter provided some much needed guidance on what the process involved. Significantly, weight was placed on Standard Bank’s early self-reporting and cooperation.
Major insolvency reform: Getting the (ipso) factos straight
In brief
Introduction
"Once in a generation" review
Shortly before the Christmas break, the much anticipated review of the United States "Chapter 11 bankruptcy" regime was published by the American Bankruptcy Institute (ABI). This is one of very few such major "root and branch" reviews of Chapter 11 since its enactment in 1978, and the first since the 1990s.
Need to know
In a first for the US and Australian markets, the Buccaneer Energy group of companies successfully had bankruptcy plans approved by the US Bankruptcy Court for both US and Australian incorporated debtor companies.
Introduction
In the decision Young, Jr (on behalf of debtor-in-possession of Buccaneer Energy Ltd) v Buccaneer Energy Ltd [2014] FCA 711, the Federal Court of Australia considered whether Chapter 11 proceedings under the United States Bankruptcy Code should be recognised as a foreign main proceeding under the Cross-Border Insolvency Act 2008 (Cth) (CBIA) and Model Law on Cross-Border Insolvency of the United Nations Commission on International Trade Law (Model Law).