A warm welcome to the Summer edition of Conyers Coverage. The whirlwind that is the Cayman Islands (re)insurance industry continues to blow with gusto! To keep you updated on recent developments, we include various items from our Insurance, Regulatory and Litigation teams, we ponder the possibilities and implications for the Cayman Islands in potentially securing Qualified Jurisdiction status with the NAIC and lots more beyond. We think there’s something for everyone in our latest edition so please dig in.
To NAIC or Not to NAIC?
Re Touradji Private Equity Master Fund Ltd において、ケイマン諸島大法廷は、任意清算中の3つのファンドについて、被害を受けた一部の投資家と共同任意清算人による申請に基づき、投資マネージャーの異議を棄却して、監督命令を下しました。
この決定は、裁判所が当該申請について適用する審査基準の指針を示し、会社法（Companies Act）第131条(b)に基づいて任意清算を公的清算に転換することが効果的、経済的、迅速的であると裁判所が考える各種の事例を示しています。
監督命令に適用される審査基準
監督命令とは、裁判所が、任意清算中の会社について、破産管理人としての資格を保有している複数名の者を公的清算人として選任することを含む命令をいいます[1]。この命令は、会社が裁判所によって清算されたかのような効果を有します[2]。すなわち、監督命令が下されると、清算人の権限が拡大され、任意清算中に行使できていた会社株主の残存権限は排斥されます[3]。
会社法においては、裁判所が任意清算について監督命令を下す条件がいくつが規定されており、これには以下の各場合が含まれます。
On August 31, 2022, significant amendments to Part V of the Cayman Islands Companies Act (“Act”) took effect to revamp the Cayman Islands restructuring regime. These amendments introduced the new role of a court-appointed “Restructuring Officer” and a dedicated “Restructuring Petition.” The Cayman Islands restructuring officer regime (“RO Regime”) shares certain features with the Chapter 11 bankruptcy procedure in the US and Canada’s Companies’ Creditors Arrangement Act.
昨今、ケイマン諸島の判決で、債権者との間のスキーム・オブ・アレンジメントを取り扱ったRe In the Matter of E-House (China) Enterprise Holdings Limited [1]において、セガル裁判官が米国、英国、ヨーロッパにおける制裁措置がスキーム・オブ・アレンジメントにどのような潜在的な法的影響をもたらすか、また、当該スキームが国際的にどのような法的効果を有するのかを明確にする判断を示しました。
現在のマクロ経済環境およびグローバル市場の激動状況に照らせば、誠実な企業再建実施後も継続した企業の事業活動が可能となるような方策を模索することにつき、柔軟で積極的な役割を果たす意思が裁判所にあることを確認したものです。
なお、ケイマン諸島が企業再建における最先端の法域であることは、裁判官による会社債権者との調整案策定のために会社を代理するリストラクチャリング・オフィサーの選任にかかる第一号事例からも示されています。この事例については「ケイマン諸島における新たな企業再建の幕開け」をご参照ください。
背景およびスキーム・オブ・アレンジメントの提案
A Cayman Islands scheme of arrangement is a court approved compromise or arrangement between a company and its creditors or shareholders (or classes thereof). A scheme of arrangement is frequently used to implement a financial restructuring by varying or cramming in the rights of the relevant creditors and/or shareholders of a company but may also be used to complete corporate transactions such as a group restructuring or reorganisation, acquisitions, mergers and take-private transactions.
Many will have waited for a bus only for two to come along at once. So it is in the Cayman Islands, with the ongoing saga as to whether a shareholder can make a claim for misrepresentation in a liquidation and, if so, where such a claim ranks in the order of priority. The rule in Houldsworth barring such claims has been in existence for over 140 years. However, two liquidations have, within weeks of each other, sought to overturn this longstanding rule.
The Grand Court of the Cayman Islands recently confirmed expressly for the first time that it has jurisdiction to wind up a segregated portfolio company ("SPC") on the insolvency of one or more, but not all, of its segregated portfolios, and to appoint restructuring officers over those segregated portfolios. The judgment is In the matter of Holt Fund SPC
Background
A Court-approved reduction of capital is one of the corporate reorganisation tools that has been successfully deployed by listed companies domiciled in the Cayman Islands in order to manage debt and liquidity.
In the Matter of Holt Fund SPC (Unreported, 26 January 2024) is the first occasion where an application has been made to appoint Restructuring Officers over portfolios of a segregated portfolio company. At first glance the judgment appears uncontroversial. However, it highlights a lacuna in the law which readers should be aware of.
Background
The Petitioner sought the appointment of Restructuring Officers (ROs) in respect of two segregated portfolios of the Holt Fund SPC.
Many jurisdictions offer a process for distressed companies to seek the protection of the Courts from enforcement action while they try to put a restructuring plan in place. England and Wales has the administration regime, and the USA has Chapter 11. Historically, the Cayman Islands has addressed this issue by means of the ‘light touch’ provisional liquidation, by which an insolvency practitioner could be appointed to supervise the company while a restructuring plan was formulated and considered, with a breathing space from creditor actions by way of a court-imposed moratorium.