In AnAn Group (Singapore) Pte Ltd v VTB Bank (Public Joint Stock Company) [2020] SGCA 33, Justice Steven Chong, delivering the judgment of the Court, (1) overturned the decision of the High Court which allowed a creditor (VTB Bank) to proceed with its winding up petition against a debtor (AnAn), and (2) upheld the arbitration agreement pursuant to which the dispute underlying the debt should first be resolved.

The High Court has ruled that directors breached their duties by taking up the company’s business opportunity for their own benefit, even if the company was unable to take up that opportunity by reason of its financial position: Davies v Ford & Ors [2020] EWHC 686.

In Joint Provisional Liquidators of Moody Technology Holdings Ltd [2020] HKCFI 416, the Hong Kong Court of First Instance (the “Hong KongCourt”) granted a recognition order to foreign provisional liquidators who were appointed on a soft-touch basis, to explore and facilitate the restructuring of a company. The order was made despite soft-touch provisional liquidation being per se impermissible in Hong Kong.

Background

On 6 April 2020, the Insolvency Act 1986 (Prescribed Part) (Amendment) Order 2020 came into force. This order amends the Insolvency Act 1986 (Prescribed Part) Order 2003, and increases the maximum amount of the prescribed part from £600,000 to £800,000.

Prescribed Part

The “prescribed part” is the term given to a portion of funds realised from assets charged by way of floating, but not fixed, charge, where:

1 the floating charge was created on or after 15 September 2003; and

In Spain individuals and entities have an obligation to file for insolvency if they are unable to regularly meet their obligations within two months of the position of insolvency coming to light. Breach of that obligation could lead to civil (and even criminal) liability.

The legal obligation imposed by the Spanish Insolvency Law 22/2003, of 9 July (the “Spanish Insolvency Law”), has been modified by Royal Decree-law 8/2020 (the “RDL”), of 17 March, on extraordinary measures to tackle the economic and social impact of COVID-19.

The Department for Business, Energy and Industrial Strategy (“BEIS”) over the weekend announced a number of proposed changes to UK insolvency law in response to the COVID-19 crisis.

The principle in ex parte James, under which the Court will not permit its officers (such as a liquidator) to act in a way which, although lawful, does not accord with the standards of right-thinking people, has recently been clarified by the English Court of Appeal in Lehman Brothers Australia Limited (in liquidation) v Edward John Macnamara & others (the joint administrators of Lehman Brothers International (Europe) (in administration)) [2020] EWCA Civ 321

The government has responded to intense pressure from the restructuring and insolvency community by announcing measures to 'protect companies hit by COVID-19'. Insolvency law will be amended 'to give companies breathing space and keep trading while they explore options for rescue'.

RAAs are a statutory restructuring mechanism which operate by apportioning the departing employer’s share of liability between it and remaining employers. As an RAA can be entered before the insolvency process is initiated, RAAs can permit corporate restructuring in response to financial hardship without triggering the departing employer’s insolvency.

The Hong Kong Court of First Instance has declined to prioritise an arbitration agreement where a debtor intended to dispute the existence of a debt without proving there was a bona fide dispute on substantial grounds.

Dayang (HK) Marine Shipping Co., Ltd v. Asia Master Logistics Ltd [2020] HKCFI 311; HCCW 14/2019

Background