In a comprehensive judgment published on 23 April 2020, the Cayman Islands Court of Appeal, comprising Moses JA, Martin JA and Rix JA, has provided welcome clarification of the interplay between a contractual agreement to arbitrate disputes arising between shareholders and the exclusive jurisdiction of the Court to determine whether a company should be wound up on the just and equitable ground.
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. |
Hong Kong Court records available publicly today show that a Petition was presented last Friday to wind up O.W. Bunker China Ltd (a Hong Kong company). The records indicate that the Winding-up Petition was presented by the company itself rather than a creditor. This is consistent with the steps taken by other companies within the OW Bunker group to seek Court protection.
We are receiving numerous enquiries regarding the fallout from the bankruptcy of OW Bunker A/S and certain associated companies. At this stage, some companies are in formal bankruptcy proceedings, with the Court protection that usually entails, but others are not.