`Forum shopping' is the practice of choosing the most favourable jurisdiction in which a claim could be heard. It is often used as a pejorative, a form of jurisdictional gamesmanship, but, in principle, there is nothing wrong in seeking to have the case heard in the forum which is most favourable to the client. It can however lead to some fierce jurisdictional battles particularly in insolvency where the choice can be stark between debtor and creditor friendly procedures.
Two key changes made to Australian insolvency law enhance restructuring efforts in Australia and could improve outcomes for US investors.
The court awarded OpCo Noteholders in excess of $320 million in Make-Whole Amount and post-petition interest, confirming that make-whole is an enforceable liquidated damage claim.
On May 11 2017 the British Virgin Islands adopted new guidelines for communication and cooperation between courts in cross-border insolvency matters.
The Court of Appeal (CICA) has provided further clarification and guidance to Cayman Islands insolvency professionals on issues ranging from voidable transactions, the scope of liquidators’ powers and legal professional privilege, following the publication this month of a number of decisions that had come before the Court during the November 2016 Court sitting. Set out below is a summary of the Court’s findings in 3 of the CICA decisions which may be relevant to your day to day practice.
Voidable Transactions
In this thoroughly new and groundbreaking case it was held that where a creditor has already filed a winding up petition in respect of a company: (1) not only may the directors of the company parry by themselves applying for the appointment of JPLs; but (2) they may do so even without a shareholder resolution or express provision to do so in the company’s articles of association.
The last decade has exposed the bankruptcy courts across the globe to a large volume of international work, and with that experience in mind, the Judicial Insolvency Network (JIN) held its inaugural meeting in Singapore in late 2016. Its intent was to formulate a set of guidelines (theGuidelines) that would promote cooperation between Courts. Sitting alongside common law and legislative cross-border provisions, the Guidelines are a practical code to enhance some of the most successful cross-border initiatives of recent years.
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In an era of increasing complexity in regulation globally, the BVI has carefully built a simple and clear regulatory framework that minimises the legal risk for lenders and financial markets participants dealing with BVI companies.
Legal
The BVI’s regulatory framework is structured to make the legal risk of lending or selling financial assets to a BVI entity lower than almost any other jurisdiction.
Court holds that TIA § 316(b) prohibits only non‐consensual amendments to an indenture’s core payment terms.