ISSUE 3 2017 FOCUS ON Brexit & the US Administration IN International News The Best Option for Dispute Resolution Brexit and the Free Flow of Data What to Expect from Trump’s FTC and DOJ in Terms of Merger Policy 2 International News EDITOR Andrea Hamilton Partner Brussels +32 2 282 35 15 [email protected] PUBLICATION EDITORS Aileen Devlin Kate Hinze CREATIVE SERVICES Jane Hanlon Cali Stefanos TABLE OF CONTENTS 3 Cross Border M&A: The Impact of Brexit, the Trump Ad
In May 2017, the Irish Government signed a commencement order giving immediate effect to the ‘Alternative A’ insolvency remedy of the Aircraft Protocol to the Cape Town Convention on International Interests in Mobile Equipment (the Convention). The long-awaited implementation of ‘Alternative A’ gives force of law in Ireland to a regime which is similar to the insolvency regime in the USA, known as Chapter 11 “reorganisation” bankruptcy. The insolvency remedies in the Convention were designed to strengthen creditor’s positions.
Further evidence that Ireland is emerging from economic recession can be seen in the publication of the Courts Service Annual Report 2016 (the Report). An examination of the Report’s figures relating to debt collection activity shows a continuing decline in creditor litigation and enforcement. The number of default judgments marked in 2016 across the District, Circuit and High Courts shows a fall to 10,475 from 14,204 during the previous year. This represents almost an 80% drop on the equivalent number of such judgments marked in 2010.
The Court of Appeal has helpfully confirmed that a judgment creditor can seek an order appointing a receiver by way of equitable execution where:
- the debtor holds a legal or equitable interest in property; and
- execution against the property is not available at law by one of the usual methods, for instance via the sheriff or by a garnishee order.
There was previously doubt as to whether such a receiver could be appointed where the debtor held a legal, as opposed to an equitable interest, in property.
In positive news for financiers and lenders, the Irish Government has signed an order which gives immediate effect to the “Alternative A” insolvency provisions of the Cape Town Convention.
The High Court has recently expressed concern that distressed borrowers are being duped into paying money to the anonymous promoters of schemes, which purport to protect them from enforcement by lenders but are actually ‘utterly misguided and spurious’.
There are a number of schemes being promoted at the moment that supposedly protect borrowers in arrears from enforcement by their lender.
Two recent developments may have rendered the Irish legal system less attractive to creditors. We examine the scope of these developments and the likely impact on debt collection activity in Ireland.
Rate of interest of judgment debts falls by 6%
The rate of interest on judgment debts has been reduced from 8% to 2%, with effect from 1 January 2017, in accordance with the Courts Act 1981 (Interest on Judgment Debts) Order 2016 (S.I. No 624 of 2016) (the “Order”).
We examine the scope of the Pensions (Amendment) (No. 2) Bill 2017 and look at the potential impact on defined benefit pension schemes in Ireland, if enacted.
Addressing a circuit split over a trademark licensee’s rights following a debtor/licensor’s bankruptcy, the US Bankruptcy Appellate Panel (BAP) for the First Circuit held that, although trademarks and trade names are not included in bankruptcy law’s definition of “intellectual property,” the licensee’s rights to use the licensor’s trademarks as set forth in the agreement were not terminated by the debtor’s rejection of the agreement. Mission Prod. Holdings, Inc. v. Tempnology LLC, Case No. 15-065 (BAP, 1st Cir., 2016) (Hoffman, J).
“Top hat plans” have many attractive features, but a new court decision is a reminder that top hat plan participants have limited protections under ERISA – and that assets held in a rabbi trust are not protected from the claims of creditors upon the employer’s bankruptcy or insolvency.