The decision provides new judicial guidance for determining the boundaries of cross-class cram down tests. 

On 28 June 2021, the High Court declined to sanction a restructuring plan proposed by Hurricane Energy plc (Hurricane), an AIM listed oil drilling company, under Part 26A of the Companies Act 2006 (Act). The plan would have seen shareholders diluted to 5% of Hurricane’s equity, with the remaining 95% issued to bondholders as consideration for a partial debt-for-equity swap. 

The ruling confirmed that Section 423 of the Insolvency Act 1986 has extensive international reach, and does not require a transaction at an undervalue to leave the debtor with insufficient assets.

Background

The decision confirms that company voluntary arrangements remain a flexible tool for restructuring leasehold portfolios.

• No rigid test exists for “basic fairness” that requires a landlord to receive at least market rent, or that contractual rent should be interfered with to the minimum extent necessary.

• If a landlord is entitled to terminate the lease and receive a better outcome than in the alternative, any automatic unfairness from changes to the terms of the lease is negated.

• Whether a CVA is unfairly prejudicial depends on all the circumstances of the case.

Landmark decision holds that the SFO does not have the power to procure documents from foreign companies outside the jurisdiction.

Der Bundesgerichtshof (BGH) hat mit Urteil vom 18. November 2020 (IV ZR 217/19) entschieden, dass Ansprüche gegen GmbH-Geschäftsführer auf Ersatz von Zahlungen, die nach Insolvenzreife vorgenommen wurden, vom Versicherungsschutz der D&O-Versicherung umfasst sind. Mehrere Oberlandesgerichte hatten dies zuletzt noch anders beurteilt. In der Praxis hatte dies zu einer erheblichen Unsicherheit geführt, nicht zuletzt mit Blick auf die infolge der COVID-19-Pandemie vorübergehend geänderten Insolvenzantragspflichten.

Hintergrund der Entscheidung

After bringing dozens of criminal charges against Paycheck Protection Program loan recipients in recent months, on January 12, the US Department of Justice announced its first civil settlement resolving allegations of PPP loan fraud.

Looking back at the last few months, the COVID-19 pandemic has hit many companies hard and amplified disruptive trends in various sectors. In addition to other measures to address COVID-19 impact on businesses, Germany has made significant progress toward international best practices for restructuring: StaRUG — known as the German scheme — came into effect on 1 January 2021, as one of the most modern restructuring laws in the world. But how will StaRUG help German companies survive the crisis and what if insolvency is unavoidable?

Through implementing the EU Restructuring Directive, German restructuring and insolvency law will be modernized, more effective, and enriched by new instruments.

Durch die Umsetzung der EU Restrukturierungs-Richtlinie soll das deutsche Sanierungs- und Insolvenzrecht modernisiert, effektiver gestaltet und um neue Instrumentarien bereichert werden.

Each year amendments are made to the rules that govern how bankruptcy cases are managed — the Federal Rules of Bankruptcy Procedure. The amendments address issues identified by an Advisory Committee made up of federal judges, bankruptcy attorneys, and others. The rule amendments are ultimately adopted by the U.S. Supreme Court and technically subject to Congressional disapproval.