Last week HM Treasury published its much anticipated consultation paper on introducing a dedicated Insurer Resolution Regime (IRR) in the UK, which would implement key international standards.

Introduction

Today, the UK Supreme Court considered for the first time the existence, content and engagement of the so-called “creditor duty”: the alleged duty of a company’s directors to consider, or to act in accordance with, the interests of the company’s creditors when the company becomes insolvent, or when it approaches, or is at real risk of, insolvency.

The High Court (Mr Justice Trower) today gave its judgment sanctioning Amigo’s ‘New Business Scheme’. A team of us at Freshfields were pleased to help Amigo with this. Here we outline the technical innovations that, despite significant legal and regulatory uncertainty, delivered the best available outcome for Amigo’s redress creditors and the prospect of Amigo lending again for the benefit of those creditors and future customers. We also identify two approaches that addressed the practical challenge of implementing a complex legal process with retail creditors.

A recent England and Wales High Court decision demonstrates the increasingly litigious nature of Court-supervised restructuring processes. It also addresses the Court’s approach to whether foreign recognition risks represent a ‘blot’ on a proposed scheme of arrangement so that the Court should decline sanction ('the recognition/blot question').

The financial loss and the uncertainty caused by the pandemic continues to affect business globally, and an increase in corporate insolvency is widely anticipated. Arbitration is an effective dispute resolution mechanism, but a counterparty entering insolvency proceedings can be disruptive. We recently wrote about insolvency being one of the key trends in international arbitration in 2021.

The High Court in London gave judgment on Friday, 3 July 2020 on the relative ranking of over $10 billion of subordinated liabilities in the administrations of two entities in the Lehman Brothers group.

The recent decisions in Re MF Global UK Ltd and Re Omni Trustees Ltd give conflicting views as to whether section 236 of the Insolvency Act 1986 has extra-territorial effect. In this article, we look at the reasoning in the two judgments and discuss a possible further argument for extra-territorial effect.

The conflicting rulings on section 236