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Good things take time: Parliamentary Joint Committee delivers report on Australia’s corporate insolvency framework

The Parliamentary Joint Committee on Corporations and Financial Services (the Committee) has delivered its report following an inquiry into the “effectiveness of Australia’s corporate insolvency laws in protecting and maximising value for the benefit of all interested parties and the economy”.

Australia, Insolvency & Restructuring, Herbert Smith Freehills LLP, Insolvency, Corporations Act 2001 (Australia)
Paulianarisico bij financieringen aan noodlijdende ondernemingen - ontwikkelingen op Europees niveau

Tijdens het Stibbe Annual Debt Finance seminar dat in februari 2023 op het Stibbe kantoor in Amsterdam werd gehouden, werd onder andere gesproken over de tegenwind op de financiële markten en de gevolgen daarvan voor financieringstransacties. Na een schets van de stand van de financiële markten en de vooruitzichten voor 2023 door Marieke Driesen, sprak Niek Groenendijk over de mogelijkheden voor een kredietnemer om zich te wapenen tegen onvoorziene omstandigheden, de belangen van financiële convenanten en andere valkuilen in de financieringsdocumentatie.

Netherlands, Insolvency & Restructuring, Stibbe, Bankruptcy, Insolvency
Past its peak: the High Court of Australia confirms the abolition of the peak indebtedness rule for unfair preferences

In the much-anticipated decision of Bryant v Badenoch Integrated Logging Pty Ltd [2023] HCA 2 (Badenoch (HCA)), the High Court of Australia (the HCA) has now confirmed that the peak indebtedness rule may not be used when assessing the quantum of an unfair preference claim arising from a continuing business relationship.

Australia, Insolvency & Restructuring, Litigation, Trade & Customs, Herbert Smith Freehills LLP, Corporations Act 2001 (Australia)
First decision on Australia’s ipso facto stay in voluntary administration

The Federal Court of Australia (Court) has handed down the first reported decision on the ipso facto stay provisions contained in the Corporations Act 2001 (Cth) (Act).

Australia, Insolvency & Restructuring, Litigation, Herbert Smith Freehills LLP, Corporations Act 2001 (Australia)
Atlas shrugged: the limits of an administrator’s lien over secured property

Chief Justice Hammerschlag, sitting in the New South Wales Supreme Court (the Court), has delivered a judgement of importance to secured creditor and insolvency practitioners alike in Volkswagen Financial Services Australia Pty Ltd v Atlas CTL Pty Ltd (Recs and Mngrs Apptd) (In liq) [2022] NSWSC 573 (Atlas).

Australia, New South Wales, Insolvency & Restructuring, Litigation, Herbert Smith Freehills LLP, Insolvency, Corporations Act 2001 (Australia), New South Wales Supreme Court
Parliamentary inquiry into corporate insolvency in Australia

The Parliamentary Joint Committee on Corporations and Financial Services (the Committee) has commenced an inquiry into the “effectiveness of Australia’s corporate insolvency laws in protecting and maximising value for the benefit of all interested parties and the economy”.[1]

Australia, Corporate Finance/M&A, Insolvency & Restructuring, Herbert Smith Freehills LLP, Coronavirus, Insolvency, Australian Taxation Office, Australian Securities and Investments Commission, Personal Property Securities Act 2009 (Australia), Australian Securities and Investments Commission Act 2001
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
Sending disclaimer to the sawmill: A liquidator’s power to disclaim land subject to environmental liabilities following the Australian Sawmilling case

In The Australian Sawmilling Company Pty Ltd (in liq) v Environment Protection Authority [2021] VSCA 294 (Australian Sawmilling), the Victorian Supreme Court of Appeal (VSCA) dismissed an appeal by the liquidators of The Australian Sawmilling Company Pty Ltd (TASCO) against a decision of Garde J of the Victorian Supreme Court (VSC) setting aside the liquidators’ disclaimer of land subject to significant environmental ‘clean up’ costs (Primary Judgment).

Australia, Victoria, Capital Markets, Insolvency & Restructuring, Litigation, Herbert Smith Freehills LLP, Australian Securities and Investments Commission, Corporations Act 2001 (Australia), Environment Protection Act 2017 (Victoria) (Australia)
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
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