The Court of Appeal has provided much needed clarification of the test for validating certain transactions by companies that are subject to a winding-up petition, pursuant to Section 99 of the Companies Law (2020 Revision).
The Cayman Islands Court of Appeal has provided much needed clarification of the test for validating certain transactions by companies that are subject to a winding up petition, pursuant to section 99 of the Companies Law (2020 Revision) (the "Companies Law").
The Legal Issue of Principle
Domestic Procedures
What are the principal insolvency procedures for companies in your jurisdiction? | Liquidation: voluntary and official. Cayman does not have an equivalent to the English concept of the company administration or to the Chapter 11 process in the United States. Schemes of Arrangement/“Soft Touch Liquidations” allow the company to enter into an agreement with its shareholders and/or creditors. |
On April 1, 2012 Drydocks World LLC (DDW) and its subsidiary Drydocks World — Dubai LLC (DDW Dubai), a Dubai- and Asia-based ship building and repair company that is wholly owned by Dubai World, became the first company to commence a reorganization proceeding in the Special Tribunal1 (the Tribunal) created by Dubai Decree No. 57 for 2009 (Decree 57) and avail itself of Decree 57’s integrated legal framework.
When entering into secured transactions, most secured lenders long assumed that, even in a bankruptcy, their borrowers would not be able to sell encumbered assets free and clear of the lenders’ liens without the lenders’ consent or, without at least providing the lenders the opportunity to bid their secured debt at an auction.