In Russian insolvency procedures, it is quite common for third parties to try to exclude property from a debtor’s insolvent estate (konkursnaya massa) by claiming title to its real property in the absence of the registered title. These third parties may refer to the agreements that had been made prior to the commencement of the insolvency procedure as well as to the actual transfer of property to them.

In Beijing Tong Gang Da Sheng Trade Co., Ltd (as assignee of Greater Beijing Region Expressways Limited) v Allen & Overy & Anor, FACV 2, 3, 4 and 5 of 2016, the Court of Final Appeal held that the addition or substitution of a party to an action amounts to a “new claim”, as defined in section 35(2) of the Limitation Ordinance (Cap 347)) and would not therefore be permitted after the relevant limitation period had expired, unless it came within the rules of court as required under Section 35(3) and (5) of the Limitation Ordinance (Cap 347).

A recent judgment of the German Federal Fiscal Court (FFC) will have significant impact on the restructuring tool kit afforded under German law. The FFC has found that the existing practice of permitting a tax liability arising from restructuring gains to be deferred and (eventually) waived violates fundamental principles of German law. The ruling has created uncertainty regarding the proper tax treatment of restructuring gains, which may have the effect of diminishing the prospect of success of a restructuring for a company in financial distress.

Overview

In IBRC v Camden[1], the Court of Appeal held that a lender's express contractual power to market a loan was not subject to an implied limitation that doing so should not interfere with the borrower's ability to obtain the best price for the assets securing the loan. In so doing, the Court of Appeal reaffirmed the "cardinal rule" that an implied term must not contradict any express term of the agreement.

Background

On January 17, 2017, the US Court of Appeals for the Second Circuit ruled in favor of the defendant in Marblegate Asset Management, LLC v. Education Management Finance Corp.1, by vacating the decision of the District Court for the Southern District of New York (the "District Court") and finding that "Section 316(b) [of the Trust Indenture Act] prohibits only non-consensual amendments to an indenture’s core payment terms." This decision, combined with the recent ruling of the District Court in granting a motion to dismiss in Waxman v. Cliffs Natural Resources Inc.

Indentures governing high yield and investment grade notes typically provide for a make-whole or other premium to be paid if the issuer redeems the underlying notes prior to maturity. The premiums are intended to compensate the investor for the loss of the bargained-for stream of income over a fixed period of time.[1] Generally, though, under New York law, a make-whole or other premium is not payable upon acceleration of notes after an event of default absent specific indenture language to the contrary.

This is the third in a series of articles highlighting the changes to be brought in by the Companies (Winding Up and Miscellaneous Provisions) (Amendment) Ordinance 2016 (Amendment Ordinance). Since our last article, 13 February 2017 has been announced as the date when the Amendment Ordinance will come into effect. The Amendment Ordinance makes amendments to the Companies (Winding Up and Miscellaneous Provisions) Ordinance (CWUMPO) and the Companies (Winding Up) Rules (CWUR).

For the past decade, shipping companies in every sector have faced continuing challenges from, among other things, declining demand, low charter rates, and an oversupply of new and more modern vessels. These factors have eroded second-hand vessel values and caused financial distress and insolvency for many shipping companies, requiring out of court financial restructurings and, in some cases, U.S. bankruptcy filings.

In Re Hin-Pro International Logistics Ltd, CACV 54/2016, the Court of Appeal upheld the Court of First Instance (CFI) decision that the courtdoes have jurisdiction to grant leave to amend a creditor’s winding-up petition, to include debts accruedafter its presentation. The company had been granted leave to appeal the CFI decision to enable the Court of Appeal to consider whether the rule in Eshelby v Federated European Bank Ltd [1932] 1 KB 254 (the Eshelby Rule), still applied.

This is the second in a series of articles highlighting the changes to be brought in by the Companies (Winding Up and Miscellaneous Provisions) (Amendment) Ordinance 2016 (Amendment Ordinance), which was gazetted on 3 June 2016 and will come into effect on a date to be appointed by the Secretary for Financial Services and the Treasury.