Section 236 Insolvency Act ("IA") 1986 enables the Court power to summon persons with information about the affairs of a company to appear before it and / or to produce documents. In our August bulletin we considered the decision of the English High Court in Re MF Global [2015] EWHC 2319 when it was held that s236 does not have extra-territorial effect. However, having looked at the issue again in Official Receiver v Norriss [2015] EWHC 2697, the High Court has departed from the position in Re MF Global.

In a judgment given on 5 November 2015, the Final Appeal Court in Hong Kong held that s30A(10)(a) of the Bankruptcy Ordinance, which prevents the period of bankruptcy running from the date the Bankruptcy Order if the bankrupt is outside of Hong Kong, is unconstitutional. The Court found that the provision, which provides that upon returning to Hong Kong the Bankrupt must inform his Trustee and the period of bankruptcy runs from that date, is a disproportionate infringement on an individual's right to travel.

This article was first published by RECOVERY News and the full article can be found online here. 

In our June seminars we discussed the Pre-Pack Pool and the proposed changes to SIP 16. The revision was recommended by Teresa Graham as part of her independent review into pre-packs in June 2014, and the new SIP 16 was introduced on 2 November 2015 to coincide with the launch of the Pre-Pack Pool.

Key provisions of the revised SIP 16, which remains virtually unchanged from the draft issued in January this year, include:

The federal government has stopped fighting court rulings that allowed an import company, which was facing steep penalty tariffs, to file bankruptcy and transfer its assets to a new business formed by the debtor's principals. The move is important to small to mid-size companies that want to rid themselves of substantial liabilities by selling assets to a new entity with identical ownership, "free and clear" under section 363 of the Bankruptcy Code.