As the tile suggests the state of recognition and assistance jurisprudence & practice in Hong Kong is less than clear. This follows the recent (mostly) conflicting 1st instance decisions of Up Energy and Global Brands. Here are my views about (i) what I believe is settled; (ii) the points of judicial difference; and (iii) what remains unclear.

Settled

Clearly there are some major economic challenges ahead. Many businesses may be able to withstand the challenges ahead but it may very well be that their trading counterparties (whether suppliers, customers or other stakeholders) will not. Whilst these times can represent an opportunity for some, such as potential acquirers (whether of businesses, assets or distressed debt), in most cases, the climate represents a threat to businesses.

Re Kaoru Takamatsu – [2019] HKCFI 802 (date of judgment 25 March 2019)

For the first time the Hong Kong Court has recognised a Japanese winding up proceeding and granted assistance to a bankruptcy trustee appointed by the Japanese Court.

Background

On 1 March 2018, the District Court of Tokyo, Twentieth Civil Division (“Tokyo Court”) ordered Japan Life Co, Ltd (“Japan Life”) to be wound up and appointed Mr Kaoru Takamatsu as trustee in bankruptcy.