As discussed in our May 2016 bulletin, New Rules for Asset Sales by Insolvent Producers (at least for now), the decision of the Court of Queen's Bench of Alberta in Re Redwater Energy Corporation, 2016 ABQB 278 ("Redwater") determined that provisions of the provincial legislation governing the actions of licensees of oil and gas assets did not apply to receivers and trustees in bankruptcy of insolvent companies, given the paramountcy of the Bank
In Alberta, regulations have historically prohibited purchasers of oil and gas assets from cherry picking operating interests in economic properties while leaving behind interests in uneconomic wells. This has had a significant negative impact on the ability of a receiver or trustee to market and sell assets owned by insolvent companies and on the prices those assets are able to attract.
On 24 March, HMRC published a summary of responses to the December consultation on Company Distributions, together with details of the Government's position on the issues raised. The December consultation was covered in my 3 February blog.
Today is the closing date for responses to a Government consultation on the tax treatment of company distributions. You can read the consultation document here.
The direction of travel, per the consultation, is clear. Anyone thinking of liquidating their company should consider these new rules carefully.
With the cyclical fluctuation in oil and gas commodity prices, the UKCS has had its fair share of E&P companies going insolvent. As the UKCS matures, the profile of companies that invest in the region is changing. Many smaller parties, potentially with less access to capital, are now building positions. The commercial exposure is that some companies will not be able to meet cash calls, creating headaches for their co-venturers.
November 2015 Financial Services Bulletin The Supreme Court of Canada Confirmed Today the Paramountcy of the Bankruptcy and Insolvency Act over License Denial Regimes The Supreme Court of Canada (“SCC”) released today its much awaited decision in 407 ETR,1 in which it upheld the decision of the Ontario Court of Appeal, and ruled that Section 22(4) of the Highway 407 Act is constitutionally inoperative to the extent that it is used to enforce a provable claim that has been discharged pursuant to section 178(2) of the Bankruptcy and Insolvency Act.
On October 13, 2015, the Ontario Court of Appeal (the "Court of Appeal") upheld1 a CCAA judge's decision that the "interest stops rule" applies in CCAA proceedings, which significantly limits unsecured creditors' ability to recover interest accrued after the date of a debtor's insolvency.
Background
In a recent decision, the Ontario Superior Court clarified the test by which Ontario courts will recognize foreign bankruptcy proceedings.
Under the Bankruptcy and Insolvency Act1, trustees have considerable discretion to administer a bankrupt’s estate in an expedient manner. However, the British Columbia Court of Appeal recently confirmed that trustees must exercise such discretion within the limits of relevant statutory provisions and common law principles.