On 2 December 2021, the Court of Appeal handed down its judgment in Windhorst v Levy [2021] EWCA Civ 1802, which concerned a challenge against the registration of a German judgment and an application for a stay of execution. Notwithstanding Brexit, the decision is relevant to cases involving (i) judgments in proceedings instituted before 31 December 2020 and (ii) insolvency proceedings opened before 31 December 2020.

Ken Baird, Mark Liscio, Michael Broeders, Marvin Knapp, Samantha Braunstein and Katharina Crinson, Freshfields Bruckhaus Deringer

This is an extract from the 2022 edition of GRR's the Americas Restructuring Review. The whole publication is available here.

In summary

In certain sectors, in particular in technology and life sciences, it is common for companies to combine forces in order to maximise business opportunities. Only rarely can a single company undertake every aspect of (for example) invention, development and exploitation by itself. A company may decide to contract out such activities, or to collaborate with a third party with different skills or resources. Such a collaboration may take the form of a joint venture.

On 18 October 2021, the EU Commission published the sixth amendment to its Temporary Framework for State aid measures to support the economy in the COVID-19 outbreak (the Temporary Framework) adopted on 19 March 2020 (see our blog post).

Summary

Legislation Update

As foreshadowed in the last edition of Insolvency Insight the legislative provisions easing the restrictions on the presentation of winding up petitions entered into effect on 1 October 2021.

This update summarises the latest jurisprudence on insolvent schemes of arrangement (schemes) and restructuring plans (RPs), and provides an overview of the key themes that are emerging in this area.

Key Concepts and Notes

• Brexit ripped up the rules on automatic cross-border recognition of formal insolvency proceedings and restructuring tools between the UK and the EU.
• Recognition will now depend on a patchwork of domestic legislation, private international law and treaties and may lead to different outcomes depending on the jurisdiction.
• Cross-border recognition is still achievable but involves careful navigation and a more tailored approach in individual cases to selection of the most effective process and its route to recognition.

Legal landscape

It’s autumn and time to put that box-set viewing on pause and perhaps instead review the likely direction of travel of the “zombie” army of distressed businesses. How do you avoid contagion?

Unless you hibernated during the various lockdowns you will not have failed to notice that the impact of Brexit, the Covid-19 pandemic, and lockdown measures took their toll on spending, incomes and jobs, tipping the UK economy into recession after negative growth in the first two quarters of 2020.

Since 1 January 2021, the European Insolvency Regulation and the Brussels I Recast Regulation no longer apply to the United Kingdom. In addition, the EU-UK Trade and Cooperation Agreement does not provide any specific recognition or enforcement mechanism in relation to cross-border insolvency and restructuring proceedings following Brexit. The question thus arises if and under which conditions Belgian courts will continue to recognise UK schemes of arrangement and restructuring plans post Brexit.