On 20 May 2020, the Corporate Insolvency & Governance Bill 2019-2021 was introduced to Parliament. With the Bill slated to be fast-tracked into law, here are some of the key insolvency aspects to be aware of.
Why now?
A company incorporated in the British Virgin Islands (the “BVI”) can be placed into insolvent liquidation either by: a shareholders’ qualifying resolution; or a court order, following an application to the court and a hearing.
The effect of an insolvent liquidation is to put the affairs of the company in the hands of an independent insolvency practitioner who is required to take possession of, protect and realise the company’s assets for the benefit of the company’s creditors.
An application to court can be made by:
Hot off the press, yesterday we learnt a great deal more about the proposed suspension of the UK’s wrongful trading laws with the publication of the Corporate Insolvency and Governance Bill 2019-21.
The office of the Registrar of Corporate Affairs (the “Registrar”) in the British Virgin Islands (the “BVI”) has responsibility for the incorporation, striking-off and restoration of struck off companies to the register of companies (the “Register”).
Administrative strike off of a British Virgin Islands company
The Registrar may strike a company off the Register for a number of different reasons, including:
Although the contentious background to the applications to restrain the presentation of two winding up petitions heard together in (but only listed singularly as) the case of Shorts Gardens LLB v London Borough of Camden Council [2020] EWHC 1001 (Ch) is somewhat unusual, these cases nonetheless raise some interesting points of principle which may be used by the courts in determining whether it is appropriate to restrain or dismiss a winding up petition due to COVID-19.
The extraordinary disruption to UK business caused by the COVID-19 lockdown has spawned much discussion about changes to existing insolvency laws to help businesses which are struggling to survive in this abnormal environment. One topic of discussion has been the so-called ‘light touch’ administration. Here we provide a quick overview of what this involves.
What do we mean by a ‘light touch’ administration?
In the current economic climate, there is a pressing need for cross-jurisdictional co-operation when it comes to the Courts’ involvement in restructuring and insolvency proceedings. An increasing number of Hong Kong companies are finding themselves in need of urgent assistance with restructuring and insolvency processes; this requires international co-operation where, as is often the case, such companies are incorporated in offshore jurisdictions.
Carey Olsen presents this unofficial consolidation of the BVI Insolvency Act 2003 (the “Act”) and the Insolvency Rules 2005 (the “Rules”), which we hope will be of interest as a reference guide for anyone involved in cross border restructuring and insolvency.
Can a company in liquidation adjudicate? Balfour Beatty Civil Engineering Limited & Anor v Astec Projects Limited, or what happens when an irresistible force meets an immoveable object?
“Art is born when the temporary touched the eternal; the shock of beauty is when the irresistible force hits the immoveable post” G K Chesterton
As Guernsey companies, like their international counterparts, fight to manage the COVID-19 crisis with differing levels of state support, much has been reported about potential changes to the insolvency framework available to bolster survival measures.