With effect as per 1 July 2013, the Austrian legislator has enacted an amendment to the Limited Liability Companies Act (GesRÄG 2013) providing primarily for a de-crease of the minimum share capital to EUR 10,000, as well as a decrease of the formation costs. These changes are aimed at maintaining Austrian limited liability companies’ competitiveness in comparison to other European limited capital compa-nies and to fostering the formation of new limited liability companies also by small service providers.

In the case, the insolvency proceedings had not been used for the purposes provided by Law 85/2006 on insolvency proceedings (Law 85) but for other purposes.

Banks in Bulgaria are seriously concerned with borrowers fraudulently manipulating their accountancy books with the effect that banks’ security interests are declared invalid and banks are declassed into ordinary (unsecured) insolvency creditors.

In times of financial difficult and a challenging market environment, establishing a restructuring trust provides an insolvencyproof structure that meets the demand of the financing banks for an immediate change of control in the com pany while ensuring a professional M&A process with an upside for all stakeholders.

BAIL-OUT DÉJÀ-VU

The Moldovan Parliament adopted a new insolvency law on 29 June 2012. The In-solvency Act No. 149 (Act No. 149), which will enter into force on 14 March 2013, is evolutionary rather than revolutionary, as its main goal appears to be the optimiza-tion of the existing insolvency procedures.

Following the new act’s entry into force, insolvency cases shall fall under the compe-tence of the court of appeal where the seat of the debtor is located. Also each such court of appeal shall hold a public register of insolvency cases.

Timing

The recent case of Re J T Frith Ltd [2012] EWHC 196 (Ch) shows:

• how secured lenders may surrender their security in order to participate in the prescribed part available for unsecured creditors on insolvency; and
• how intercreditor deeds may be worded to allow senior secured creditors to participate in the prescribed part, despite retaining their security.

Background

Summary

The High Court has held in the “Extended Liens” application that a “general lien” granted by a client of Lehman Brothers International (Europe) (“LBIE”) over financial collateral held by LBIE as security for obligations owed by the client to LBIE or any other Lehman entity was a valid floating charge, both in relation to the client’s debts to LBIE and its debts to LBIE’s affiliates.

On 1 November 2012, the High Court gave judgment in favour of the Special Administrators (“SAs”) of MF Global UK Ltd (“MFGUK”), in relation to a claim by MF Global Inc (“MFGI”) arising from certain repo-to-maturity transactions (the “RTM Application”). These transactions concerned the repo of European debt securities by MFGI to MFGUK, which were governed by a Global Master Repurchase Agreement (“GMRA”).

This update highlights developments in the administration of MF Global UK (“MFG”) since our last alert dated 15 June 2012.

Estimated outcomes