The Hong Kong Courts exercise supervisory jurisdiction over liquidations in Hong Kong. Recently, the High Court reiterated its role to assist liquidators to effectively discharge their duties, in the best interest of the general body of creditors.

In Re Guy Lam Kwok Hung [2023] HKCFA 9, the Court of Final Appeal clarified when a debtor can resist a bankruptcy petition based on an exclusive jurisdiction clause (EJC) in his contract with the petitioner creditor. It is important to appreciate the Court’s reasoning and how it can be applied to various factual scenarios.

Delaware’s Bankruptcy Court has recently issued two insightful opinions that impact a creditor’s ability to establish the “receipt” element of a valuable 503(b)(9) administrative expense priority claim.

In an era when goods or materials often originate from suppliers or manufacturers outside the United States, bankruptcy courts are grappling with when “receipt” of goods occurs for the purpose of 503(b)(9) claims.

Many creditors who have supplied goods to a debtor before a bankruptcy case begins think their only prospects for recovery will be pennies on the dollar. While often times, pre-petition claims are relegated to receive small, if any, distributions, there is a unique carve-out in Section 503(b)(9) of the Bankruptcy Code that elevates “goods” supplied in the 20 days before a bankruptcy filing to administrative expense status.

Lenders and secured creditors often require that debtor-customers direct all receivable collections into a lockbox, hoping to wrangle any available proceeds to apply to their debtors’ outstanding debt. In requiring a debtor or its customer to remit payments to a lockbox, however, creditors may be overlooking a potential source of significant liability. A creditor using a lockbox may unwittingly expose itself to greater risk and liability than just a debtor’s default if it receives funds that were collected as sales tax on a debtor’s goods or services.