As Russia’s invasion of Ukraine continues, governments around the world are coordinating and responding with increasingly severe sanctions and export controls on Russian entities, institutions, and individuals. Insolvency practitioners first wonder whether sanctioned entities, or entities connected to sanctioned individuals, can enter into an insolvency procedure and, if so, how does the insolvency practitioner accept an appointment and get paid?
There are distinct advantages to investors sitting on the boards of their portfolio companies, not least their ability to look after their investment and work toward maximising their return. The human capital provided by investor directors can be invaluable in driving efficiencies and creating growth opportunities. The interests of investors, investor directors, and the company will generally be aligned in seeking the success of the business.
The National Security Investment Act 2021 (the “Act”) came into effect on 4 January 2022 and introduced a new UK investment screening regime focused on national security risks (the “NSI Regime”). It is similar to the Committee on Foreign Investment in the United States (“CFIUS”) regime. The Act is wide reaching; it provides the UK government with the power to review and intervene in transactions that may pose a UK national security risk due to a transfer of control of sensitive entities or assets.
On 10 March 2022, the UK High Court held the adjourned sanction hearing regarding Smile Telecoms Holdings Limited’s (“Smile”) second proposed restructuring plan. Despite Smile Telecoms’ first restructuring plan being sanctioned by the UK High Court back in March 2021, the African telecommunications company still faced liquidity shortages. This prompted the company to propose a second restructuring plan under Part 26A of the UK Companies Act 2006 (the “Companies Act”). The second restructuring plan would see the Smile Telecoms’ group senior secured lender, 966 CO S.a. r.l.
This week, the Ninth Circuit takes a close look at a sizable antitrust jury award, and explains what constitutes a tax “return” for purposes of bankruptcy law.
OPTRONIC TECHNOLOGIES, INC v. NINGBO SUNNY ELECTRONIC CO. LTD.
The Court held that sufficient evidence supported a jury verdict holding telescope manufacturers liable for antitrust violations.
This update summarises the latest jurisprudence on insolvent schemes of arrangement (schemes) and restructuring plans (RPs), and provides an overview of the key themes that are emerging in this area.
Key Concepts and Notes
This week, the Ninth Circuit explains the ins-and-outs of property abandonment under the Bankruptcy Code, and explores the government’s privilege to withhold the identity of informants in discovery.
The case of John Doyle Construction Ltd v Erith Contractors Ltd [2021] EWCA Civ 1452 (07 October 2021) saw the Court of Appeal re-explore the conflict between the adjudication process and insolvency following the Supreme Court decision ofBresco Electrical Services Ltd v Michael J Lonsdale Ltd.
According to press reports, utilities contractor NMCN (formerly North Midland Construction) plc and its subsidiary NMCN Sustainable Solutions Limited, have gone into administration.
Administration is the procedure by which a company that is, or is likely to become, insolvent can be reorganised or have its assets realised for the benefit of creditors. The primary aim of an administration is to rescue the company so that it can continue to trade as a going concern. If this is not possible, a company may go into administration for two other purposes:
As Andrew Jones and Daniela Miklova report, the recent case of Ristorante Limited t/a Bar Massimo v Zurich Insurance plc [2021] EWHC 2538 is a useful insight into how the Court will interpret the questions and answers in insurers’ proposal forms in coverage disputes. It also shows how insurers can lose potential policy defences through the drafting of proposal form questions going wrong.