On 2 August 2021, the Treasury released a consultation paper seeking feedback on changes to improve creditors’ schemes of arrangement in Australia (the Consultation Paper). The submissions process has now closed.
Creditors can often confuse (i) the outlawed practice of “phoenixing” with (ii) pre-pack administrations. The former is an abuse of the privilege of limited liability through (often repeatedly) liquidating a company laden with debts only to emerge shortly after under the guise of a new limited company, debt free, effectively carrying on the exact same business with the same name, premises and people.
Death does not release an individual from their debts and liabilities, nor does it allow transactions made to loved ones to escape challenge. This is so regardless of whether the transactions were made with the intention to defraud creditors.
Insolvency administration orders (IAOs)
Slotine explains the steps and stakeholders involved in creditors’ voluntary winding-up and directors’ voluntary winding-up of an insolvent company in Hong Kong.
In 2016, the High Court determined that a person may propose to do something without having a settled intention to do it and dismissed an application for an order removing a fourth notice of intention from the court file. At the time the fourth notice was filed, the director only intended to appoint administrators if a CVA proposal was rejected by creditors.
This article debunks the myths surrounding court-sanctioned winding-up in Hong Kong and lays out the process clearly, so you know what to expect.
The term “winding-up” refers to the sale of a company’s assets to settle its debts and distribute the surplus (if any) to its shareholders. Once this process is complete, the company is dissolved.
- Victims of fraud often face an uphill battle in seeking restitution for their loss.
A balancing act
Creditors with legitimate grounds to challenge scheme or restructuring plan proposals and who assist the court in so doing should not be unduly discouraged by the costs regime. At the same time, frivolous arguments should not be supported with the promise of a costs award without consideration of party’s interests and other factors.
Virgin Active restructuring plans
Belgium has already taken numerous measures to mitigate the economic impact of the coronavirus (COVID-19). The federal government has now also decided temporarily to protect debtors affected by the coronavirus crisis from creditors by imposing a stay on creditors’ right of creditors to enforce debts, terminate or dissolve existing agreements early and initiate bankruptcy proceedings.