The long-running saga between Shandong Chenming Paper Holdings (“Shandong Chenming“) and Arjowiggins HKK2 Ltd (“Arjowiggins“) has continued with the Court of Appeal handing down its judgment on an appeal against a lower court judgment which had dismissed Shandong Chenming’s application to injunct Arjowiggins from presenting a winding-up petition against Shandong Chenming (Shandong Chenming Paper Holdings Limited v. Arjowiggins HKK2 Limited [2020] HKCA 670).

Introduction

An arbitral award is sufficient evidence to commence an insolvency involuntary proceeding against a debtor.^[1]

With this case law a door has been opened to an alternative remedy: securing the debt recognized under an arbitration award through insolvency proceedings, and use this course of action to push the debtor to eventually settle.

In this article, we will address:

On 30 July 2020, the Insolvency, Restructuring and Dissolution Act 2018 (IRDA) came into operation. The IRDA is an omnibus legislation housing all of Singapore’s insolvency and restructuring laws in one single piece of legislation.

The general framework of the IRDA has been discussed in the first article in our series of articles covering the various aspects of IRDA and can be found here.

The High Court has expedited a trial at which it would be determined whether luxury car manufacturer McLaren Group could obtain the release of certain security for the benefit of its senior noteholders, failing which a financial restructuring which was contingent on that release could not be implemented: McLaren Holdings Ltd v US Bank Trustees Ltd [2020] EWHC 1892 (Ch). The court concluded that, absent determination of the proceedings within one month, McLaren Group would have no choice but to enter an insolvency process and that this justified expedition in this case.

Singapore’s Insolvency, Restructuring and Dissolution Act (the “IRDA“), together with 48 pieces of subsidiary legislation, comes into force today, 30 July 2020 (available here).

The Insolvency, Restructuring and Dissolution Bill was passed in the Parliament on 1 October 2018 and assented to by the President on 31 October 2018. Today, i.e. 30 July 2020, the Insolvency, Restructuring and Dissolution Act 2018 (IRDA) will finally come into effect. In this article, which is the first of five in a series of articles covering various aspects of IRDA, we will provide an overview of its main features.

History of Singapore’s insolvency regime

As the COVID-19 pandemic continues to cause significant disruptions in the US and global economy, it is likely that US companies experiencing financial difficulties will seek to restructure their debts and other obligations. In anticipation of such restructurings, this article provides a brief overview of voluntary restructurings in the US for non-US parties with investments in or commercial relationships with US companies.

In recent years, there has been an increased interest in obtaining third-party funding to commence legal proceedings. The insolvency sector in particular has seen an increase in applications to court for approval of third-party funding agreements. In this article, we discuss how an insolvent entity may seek approval from the court for third-party funding to pursue legitimate claims.

Third-party funding an important resource for insolvent companies

The Corporate Insolvency and Governance Act 2020 introduces sweeping insolvency reforms in response to the business impacts of Covid-19, designed “to give companies breathing space and keep trading while they explore options for rescue”. Our UK Restructuring, Turnaround and Insolvency team have published an article in International Corporate Rescue which considers the key elements of the reforms.

In what is likely to be one of this year’s landmark insolvency decisions, the Supreme Court in Bresco v Lonsdale has considered the interaction between insolvency set-off and adjudication, though the judgment is likely to have application to other dispute resolution processes including litigation and arbitration. The Supreme Court, unlike the High Court and Court of Appeal, permitted the adjudication to continue and, in doing so, dismissed the suggestion that insolvency set-off always results in the extinction of cross-claims to be replaced by a single claim for the balance.