The Corporate Insolvency and Governance Act 2020 is far-reaching with its implications extending to pension schemes. Pension scheme employers and trustees should ensure that they are familiar with the provisions of the Act, and the potential impact that they could have on schemes, employers and savers.
Introduction
The Act received royal assent on Thursday 25 June. The Act passed through Parliament very quickly, so that its provisions can be used by companies experiencing financial difficulty as a result of the COVID-19 pandemic. The Act contains:
On 25 June 2020, the Corporate Insolvency and Governance Bill (the “Bill”) received Royal Assent and on 26 June 2020 CIGA came into force. The restructuring team in Mayer Brown’s London office has previously commented on the different elements of the Bill in a series of blog posts and podcasts.
Summary
Generally with a winding-up petition, if the petitioner is successful in obtaining a winding-up order, the petitioner will have its costs of the proceedings. If, on the other hand, the petition is dismissed, then the petitioner has been unsuccessful and it should pay the costs of the proceedings. We explore the Companies Court’s treatment of costs in three recent decisions below.
From what Assets should a Petitioner have its Costs?
Under Hong Kong law, the courts’ jurisdiction is ordinarily territorial in nature. A plaintiff or applicant has to obtain permission (“leave”) of the court before it can validly serve a writ or other document initiating a legal action on a defendant or respondent located outside Hong Kong. For actions begun by writ, the procedures and criteria for applications for leave in this respect are set out under Order 11 of the Rules of the High Court (“RHC”).
Did you know that a liquidator of a foreign company may seek the assistance of the Hong Kong Court to obtain orders for the production of information which orders are, in substance, of the type made in Hong Kong windings-up under section 221(3) of the Companies (Winding-up and Miscellaneous Provisions) Ordinance?
The regulatory amendments drawn up by the Secretary of State for Work and Pensions following the outcome in Trustees of Olympic Airlines SA Pension &Life Assurance Scheme v Olympic Airlines SA have been drafted narrowly and may end up protecting no one other than the beneficiaries of the Olympic Airlines pension scheme.
The issue
The regulatory amendments drawn up by the Secretary of State for Work and Pensions following the outcome in Trustees of Olympic Airlines SA Pension & Life Assurance Scheme v Olympic Airlines SA have been drafted narrowly and may end up protecting no one other than the beneficiaries of the Olympic Airlines pension scheme.
The issue
In the bankruptcy proceedings in respect of Mr Gabriel Ricardo Dias-Azedo (the "Bankrupt"), the Court of First Instance recently exercised its discretion under sections 37(2) and 97 of the Bankruptcy Ordinance (Cap. 6) (BO) in favour of two creditors and granted them a priority claim against the Bankrupt's estate for their costs in preserving his assets incurred before receiving notice of the bankruptcy petition.
Background
In the recent case of Lau Siu Hung v. Krzystof Marszalek (HCCW 484/2009, 17 June 2013) the Court of First Instance held that an annulment of bankruptcy does not debar a creditor, who has not proved his provable debt, from asserting his claim after the annulment.
Procedural Background