The property industry has seen a dramatic decline in capital values over the last two years with peak to trough falls of approximately 44 per cent compared to a peak to trough decline of approximately 27 per cent during the recession of the early 1990s. This, together with the effect of the challenging economic climate, has led to a number of high profile insolvencies of property owners, developers and occupiers. Given the uncertain economic outlook, it is likely that these trends will continue.

The shipping industry was arguably one of the hardest hit by the downturn that spread around the world late last year. The severe shipping slump, evidenced by a 93.5 per cent fall in the Baltic Dry Index between the summer of 2008 and December 2008, inevitably led to insolvencies of shipping companies across the globe1. This article briefly considers the unique challenges that insolvency practitioners face when balancing insolvency procedures against the application of maritime law.

The Office of Public Sector Information (OPSI) has published The Insolvency (Scotland) Amendment (No. 2) Rules 2009. These Rules amend the Insolvency (Scotland) Rules 1986 (S.I. 1986/1915). No Regulatory Impact Assessment has been prepared in relation to these Rules as they are not expected to impose any significant burdens on business.

View The Insolvency (Scotland) Amendment (No. 2) Rules 2009, 1 September 2009  

On August 11, 2009, in a closely monitored dispute in the bankruptcy proceeding of General Growth Properties, Inc. (“GGP”), the Bankruptcy Court for the Southern District of New York rejected motions filed by several mortgage lenders to dismiss the bankruptcy filings of certain special purpose entity subsidiaries (SPEs) of GGP. In re General Growth Properties, Inc., et al., No. 09-11977, slip op. (Bankr. S.D.N.Y. Aug. 11, 2009).

If Departmental activity, debate in Parliament and media articles are an indication, the Federal Government’s much awaited response to the Ripoll Report is imminent.  

Summary

Exposure draft legislation has been released which proposes amendments to the GST legislation to make it clear that liquidators and other representatives of incapacitated entities are liable for GST on transactions within the scope of their appointment.

Date of effect

It is proposed that the main operative provisions of the legislation have effect retrospectively from the commencement of the GST Act on 1 July 2000.

Background

The Treasury has published the Financial Markets and Insolvency (Settlement Finality) (Amendment) Regulations 2009, which will come into force on 1 October 2009. They will amend the Financial Markets and Insolvency (Settlement Finality) Regulations 1999, following changes in insolvency law.  

Pending motions in the Bankruptcy Court for the Southern District of New York in General Growth Properties’ (GGP) bankruptcy case (Case No. 09-11977) are expected to shed new light on how courts may treat real estate special-purpose entities in bankruptcy and may also have implications for the efficacy of bankruptcy-remote SPE structures used in asset-backed securitization transactions.

The FSA has published a statement entitled Wider implications referral: Lehman-backed structured products.  

In the statement the FSA together with the Financial Ombudsman Service have jointly concluded that the Lehman Brothers’ insolvency raises issues in the UK structured products market.  

It has been agreed that the FSA will now consider issues relating to Lehman-backed structured products under “the wider implications process” in order to allow it to explore all options to achieve the best outcome for consumers.