Both of Canada’s primary insolvency statutes, the Bankruptcy and Insolvency Act (“BIA”) and the Companies’ Creditors Arrangement Act (“CCAA”) provide for an automatic stay of all legal proceedings when an insolvent debtor files for or seeks insolvency protection. The purpose of the stay is to provide breathing space to a debtor attempting to restructure its business so as to avoid “death by a thousand cuts” and also to ensure similarly situated creditors are treated equally.
Recent Development
The Law on the Amendments to the Code of Enforcement and Bankruptcy and Certain Laws ("Law No. 7101") was published on the Official Gazette on March 15, 2018.
Background
As a result of the studies conducted by the Coordination Council for the Improvement of the Investment Environment, the Law No. 7101 was introduced to the Turkish Parliament.
The difference between debt and equity claims can cause confusion among lenders, creditors, and insolvency professionals alike. In Tudor Sales Ltd. (Re), the British Columbia Supreme Court provided further judicial guidance on this distinction.
Russia’s bankruptcy law (the Law) has been amended to expand the list of persons who may be held vicariously liable for a bankrupt’s debts and clarify the grounds for such liability.
Definition of controlling person clarified
In many decisions involving US chapter 15 cases, the bankruptcy court’s principal focus will be on what is the debtor’s center of main interests (COMI). An ancillary issue is whether it is appropriate to create COMI to obtain the benefit of a more favorable jurisdiction to restructure a company’s debt (otherwise known as “COMI shifting”).
Russia's bankruptcy law (the Law) has been amended to expand the list of persons who may be held vicariously liable for a bankrupt's debts and clarify the grounds for such liability.1
Definition of controlling person clarified
On 25 April 2017, the President of the Republic of Azerbaijan signed a decree approving the Law on Amendments to the Bankruptcy Law (the Amendments).
The Amendments incorporate the definition of related parties to the debtor in accordance with the Civil Code of the Republic of Azerbaijan (the Civil Code). The related parties include the persons described in Article 49-1.1 of the Civil Code as well as individuals dismissed from the debtor’s management bodies within one year prior to the beginning of bankruptcy.
The United States Court of Appeals for the Ninth Circuit recently held in Mastan v. Salamon (In re Salamon) that an undersecured creditor with a nonrecourse claim lost the right to assert a deficiency claim under section 1111(b) of the Bankruptcy Code when a senior secured creditor foreclosed on and sold its collateral during the bankruptcy case.
On 25 April 2017, the President of the Republic of Azerbaijan signed a decree approving the Law on Amendments to the Bankruptcy Law (the Amendments).
The Amendments incorporate the definition of related parties to the debtor in accordance with the Civil Code of the Republic of Azerbaijan (the Civil Code). The related parties include the persons described in Article 49-1.1 of the Civil Code as well as individuals dismissed from the debtor's management bodies within one year prior to the beginning of bankruptcy.
Third party releases in a chapter 11 plan have become fairly common in the United States. A recent decision by the Delaware District Court in Opt-Out Lenders v. Millennium Lab Holdings II, LLC (In re Millennium Lab Holdings II, LLC), however, questions whether the bankruptcy court has the authority to approve nonconsensual third party releases as part of confirmation of a chapter 11 plan.