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IBC: Resolution Plan Involving ‘Combination’ Must Clear CCI Hurdle First

The legal framework w.r.t. law of insolvency in India has seen considerable progress since the introduction of Insolvency and Bankruptcy Code, 2016 (“IBC”). The Legislature, taking cue from various judgments passed by the courts and the grey areas identified during the implementation of the provisions of IBC, introduced various amendments from time to time. However, notwithstanding such amendments, various legal questions involving interpretation and implementation of provisions of IBC keep arising posing challenges before the Courts to resolve the same.

India, Competition & Antitrust, Insolvency & Restructuring, Litigation, Singhania & Partners LLP, Competition Commission of India, Insolvency and Bankruptcy Code (India), Supreme Court of India, National Company Law Tribunal
Whether the limitation to file an appeal under IBC will commence on the date of pronouncement of order or from the date when contents are known to the aggrieved party?

The National Company Law Appellate Tribunal (New Delhi Bench) (“NCLAT”) in two recent judgments passed in Raiyan Hotels and Resorts Pvt. Ltd. vs. Unrivalled Projects Pvt. Ltd. [Company Appeal (AT) (Insolvency) No. 1071 of 2023] and Aryan Mining & Trading Corpn Pvt. Ltd. vs Kail limited and Anr. [Company Appeal (AT) (Insolvency) No.

India, Company & Commercial, Insolvency & Restructuring, Litigation, Singhania & Partners LLP, Insolvency, Supreme Court of India, National Company Law Tribunal
Whether the limitation to file an appeal under IBC will commence on the date of pronouncement of order or from the date when contents are known to the aggrieved party?

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India, Insolvency & Restructuring, Litigation, Singhania & Partners LLP, Insolvency, Supreme Court of India, National Company Law Tribunal
Clearing up the cloud? Perhaps partly, as the Court of Final Appeal affirms the approach to dismissing bankruptcy proceedings in favour of the parties’ agreed forum

If a debt arises from a contract that contains an exclusive jurisdiction clause (EJC) in favour of a foreign court, how will the Hong Kong court deal with a bankruptcy petition based on that debt? A highly anticipated judgment from Hong Kong’s highest court suggests that the bankruptcy petition will likely be dismissed, and that the foreign EJC will be given effect. But, as we will discuss below, the Court seems to leave other possibilities open, depending on the facts in a particular case.

Hong Kong, Insolvency & Restructuring, Herbert Smith Freehills LLP
Hong Kong Court of Appeal considers the effect of exclusive jurisdiction clause on bankruptcy proceedings

A recent Hong Kong Court of Appeal decision examined a creditor’s right to commence bankruptcy/insolvency proceedings where the petition debt arises from an agreement containing an exclusive jurisdiction clause in favour of a foreign court: Guy Kwok-Hung Lam v Tor Asia Credit Master Fund LP [2022] HKCA 1297.

Hong Kong, Arbitration & ADR, Insolvency & Restructuring, Litigation, Herbert Smith Freehills LLP
COMI as first port of call? Harris J lays out a modified common law framework for recognising foreign insolvency proceedings in Hong Kong

Historically, the Hong Kong courts have generally recognised foreign insolvency proceedings commenced in the jurisdiction in which the company is incorporated. This may no longer be the case in Hong Kong following the recent decision of Provisional Liquidator of Global Brands Group Holding Ltd v Computershare Hong Kong Trustees Ltd [2022] HKCFI 1789 (Global Brands).

Hong Kong, Insolvency & Restructuring, Litigation, Herbert Smith Freehills LLP, Coronavirus, UNCITRAL, Hong Kong Stock Exchange
COMI is first port of call - a modified framework for recognising foreign insolvency proceedings in Hong Kong

Historically, the common law has only recognised foreign insolvency proceedings commenced in the jurisdiction in which the company is incorporated. This may no longer be the case in Hong Kong. Going forward, a Hong Kong court will now recognise foreign insolvency proceedings in the jurisdiction of the company’s “centre of main interests” (COMI). Indeed, it will not be sufficient, nor will it be necessary, that the foreign insolvency process is conducted in a company’s place of incorporation.

Hong Kong, Insolvency & Restructuring, Litigation, Herbert Smith Freehills LLP, Coronavirus
Can a Chapter 15 order discharge US law governed debt for the purposes of the rule in Gibbs? The Rare Earth decision and beyond

On 6 June 2022, Mr Justice Harris sanctioned a Hong Kong scheme of arrangement for Rare Earth Magnesium Technology Group (the Company) in re Rare Earth Magnesium Technology Limited [2022] HKFCI 1686 (Rare Earth).

Hong Kong, USA, Insolvency & Restructuring, Litigation, Herbert Smith Freehills LLP
Hong Kong Court holds that commercial decisions in a voluntary winding up fall in the remit of a liquidator

We previously wrote about the Court’s attitude to liquidators’ applications for directions on matters arising in a compulsory winding up (i.e., by the court) under section 200 of the Companies (Winding Up and Miscellaneous Provisions) Ordinance, Cap.

Hong Kong, Insolvency & Restructuring, Litigation, Herbert Smith Freehills LLP
Effect of breach of settlement agreement under Insolvency & Bankruptcy Code

The Insolvency and Bankruptcy Code, 2016 (“IBC”) being a relatively new legislation, has witnessed inconsistent interpretation of its various provisions, especially in respect of certain legal issues, which are grey areas i.e. the issues which are not specifically dealt with under the existing provisions of IBC. One of such interesting legal issue is effect of breach of settlement agreements, entered into between two parties, where one party promises to pay a certain amount to the other party.

India, Insolvency & Restructuring, Litigation, Singhania & Partners LLP, National Company Law Tribunal