The National Security and Investment Act 2021 (the Act) comes into force on 4 January 2022. The Act sets out the UK’s new national security screening regime. The Act replaces, and significantly extends, the UK government’s power to investigate and intervene in transactions which pose, or could pose, threats to the UK’s national security (see our earlier related blog post).

A new Act, which received Royal Assent on 15 December 2021, extends the existing directors’ disqualification regime to the directors of dissolved companies.

In the October 2021 edition of IBA Insolvency and Restructuring International, Peter Hayden and Jonathan Moffatt explain recent decisions in the UK and the Cayman Islands on the narrowing of the rule in Prudential and its implications for shareholders and creditors considering litigation.

Introduction

In August 2021, Sir Alistair Norris sanctioned the restructuring plan of Amicus Finance PLC (Amicus) (as we wrote about at the time). On 15 November 2021, the judge handed down his reasoning for sanctioning the plan.

Background

On 18 October 2021, the EU Commission published the sixth amendment to its Temporary Framework for State aid measures to support the economy in the COVID-19 outbreak (the Temporary Framework) adopted on 19 March 2020 (see our blog post).

The UK's latest quarterly company insolvency statistics, published on 29 October, suggest that the unexpectedly calm seas seen over the last 18 months (and maintained by unprecedented government economic support) may be starting to give way to stormier waters as corporate insolvencies begin to return to pre-pandemic levels.

The Cayman Islands' legislature has recently gazetted the Companies (Amendment) Bill, 2021 (the Amendment Bill), proposing the introduction of a new corporate restructuring process and the concept of a dedicated 'restructuring officer' into the Cayman Islands Companies Act (2021 Revision). Under the Amendment Bill, the filing of a petition for the appointment of a restructuring officer would trigger an automatic global moratorium on claims against the company, giving it the opportunity to seek to implement a restructuring.

1. Related Fund Entity filings for private funds]

On 1 September 2021, the Cayman Islands Monetary Authority (CIMA) issued a Notice advising industry that a new Related Fund Entity (RFE) form for private funds was available for use via CIMA's Regulatory Enhanced Electronic Forms Submission (REEFS) portal.

Before 1st October 2021, French law did not provide for the possibility to cram down shareholders, other than under Article L. 631-19-2 of the French Commercial Code, which sets conditions which are so stringent that it is not used in practice.

Directive 2019/2023 has let EU member states decide whether shareholders should be a class of “affected parties” subject to cross-class cram down or whether other measures should be implemented to avoid shareholders preventing, or making it difficult, in an unreasonable manner, the approval of a restructuring plan.

The High Court has rejected a landlord's challenge to the Caffè Nero CVA, giving support to the ongoing usefulness of CVAs in high street restructurings. The case raised issues around the use of the electronic decision procedure set out in the Insolvency Rules for CVAs, nominee and director decision-making during the CVA process, CVA modifications and provision of information to CVA creditors.

Background