There has been no shortage of high-profile insolvencies in the crypto market in recent months across a range of market participants and geographies. These include the US Chapter 11 and Bahamas provisional liquidation of FTX as well as the US Chapter 11 filings of BlockFi, Singapore-based crypto hedge fund ThreeArrows Capital, US-based lenders Celsius Network and Voyager Digital, US-based crypto mining data centre Compute North and German crypto bank Nuri.

In the context of a trade finance dispute, the High Court has considered the contractual interpretation of an irrevocable letter of credit incorporating the commonly used code in the Uniform Customs and Practice for Documentary Credits 600 (UCP 600), published by the International Chamber of Commerce (ICC). In particular, the court held that the issuer’s interpretation of the letter of credit would, in practice, render the instrument revocable, which was inconsistent with the UCP and therefore not the proper construction.

Chief Justice Hammerschlag, sitting in the New South Wales Supreme Court (the Court), has delivered a judgement of importance to secured creditor and insolvency practitioners alike in Volkswagen Financial Services Australia Pty Ltd v Atlas CTL Pty Ltd (Recs and Mngrs Apptd) (In liq) [2022] NSWSC 573 (Atlas).

The Parliamentary Joint Committee on Corporations and Financial Services (the Committee) has commenced an inquiry into the “effectiveness of Australia’s corporate insolvency laws in protecting and maximising value for the benefit of all interested parties and the economy”.^[1]

Jersey law ruling will have far reaching ramifications for trust administration in common law jurisdictions

A much-anticipated UK decision confirms directors' obligations to creditors, but changes little in practice

BTI 2014 LLC (Appellant) v Sequana SA and Others (Respondents)

Summary

The UK Supreme Court has, for the first time, considered the existence, content and engagement of an obligation on directors to take into account the interests of creditors when a company becomes, or is on the cusp of becoming, insolvent (otherwise known as the “creditor duty”).

Key Takeaways

The restructuring plan regime - including, for the first time under English law, cross-class cram down - was introduced in June 2020. Our experience with restructuring plans proposed to-date has been that the English courts have (for the most part) implemented this new tool flexibly, pragmatically and commercially.

A recent Hong Kong Court of Appeal decision examined a creditor’s right to commence bankruptcy/insolvency proceedings where the petition debt arises from an agreement containing an exclusive jurisdiction clause in favour of a foreign court: Guy Kwok-Hung Lam v Tor Asia Credit Master Fund LP [2022] HKCA 1297.

The restructuring plan regime - including, for the first time under English law, cross-class cram down - was introduced in June 2020. Our experience with restructuring plans proposed to-date has been that the English courts have (for the most part) implemented this new tool flexibly, pragmatically and commercially.