For the first time in England & Wales, a court has ordered the winding-up of a listed plc on the grounds of loss of substratum – the abandonment of the company's original main object and purpose. If Hong Kong follows this decision, it would be very welcome to minority shareholders who would have an additional option to retrieve their investment monies from companies that embark on a completely different path to that for which they initially signed up.

Section 365 of the Bankruptcy Code creates a framework through which a debtor can elect to either assume or reject an executory contract. Because the Bankruptcy Code does not define “executory,” courts utilize various tests to determine if a debtor can assume a contract—and thus be obligated to perform—or reject a contract—and thus the contract is deemed breached immediately prior to the bankruptcy filing date. The Countryman test is overwhelmingly the most commonly applied test to determine a contract’s executory nature.

We are delighted to share with you our Financial Institutions Horizons 2021, which provides a snapshot of key legal topics and market trends across the globe, shaping the future of the financial institutions market.

In a pair of recent contrasting judgments, Re Agritrade Resources Ltd [2020] HKCFI 1967 and Re Rare Earth Magnesium Technology Group Holdings Ltd [2020] HKCFI 2260, the Hong Kong Court has once again confirmed its pragmatic approach towards applications by foreign liquidators and provisional liquidators for recognition and assistance in Hong Kong. The judgments emphasize the importance of adhering to the standard forms of order adopted by the Hong Kong courts in respect of such applications, and the need for any departure from the standard form to be fully justified.

RE: A COMPANY (INJUNCTION TO RESTRAIN PRESENTATION OF PETITION)

The Australian Government has introduced new laws which are intended to avoid unnecessary corporate insolvencies in light of the challenges presented by the unfolding COVID-19 global pandemic. The new laws came into effect on 25 March 2020 and include:

Eigentümerrisiko im Insolvenzfall?

Aufgrund der angespannten Situation in der Hotelbranche treten aktuell diverse Mieter an ihre Vermieter heran und bitten um Stundung oder Erlass der Mietzahlungen für die kommende Zeit. Die Vorschläge für mögliche Kompromisse sind vielfältig – dabei ist aber immer auch die insolvenzrechtliche Situation zu beachten, um hier keine Risiken für Mieter oder Vermieter zu schaffen. Die Ausführungen dieses Beitrags gelten gleichermaßen auch für Hotelpachtverträge.

Aktuell diskutierte Kompromisse

Wi­der­le­gung der Ver­mu­tung ei­ner ein­ge­tre­te­nen Zah­lungs­un­fä­hig­keit durch Ein­ho­lung ei­nes Sach­ver­stän­di­gen­gut­ach­tens (BGH, Be­schluss vom 12. Sep­tem­ber 2019 – IX ZR 342/18)

Ein kürz­lich er­gan­ge­ner Be­schluss des BGH setzt sich mit der Fra­ge aus­ein­an­der, wie der An­fech­tungs­geg­ner der An­nah­me der Zah­lungs­un­fä­hig­keit des Schuld­ners im Pro­zess ent­ge­gen­tre­ten kann.

In In re 1141 Realty Owner LLC, et al., No. 18-12341 (SMB), 2019 WL 1270818 (Bankr. S.D.N.Y. March 18, 2019), Bankruptcy Judge Stuart M. Bernstein of the U.S. Bankruptcy Court of the Southern District of New York recently reaffirmed that upon sufficient contractual language, "make whole" prepayment premiums are enforceable under New York law even after loan acceleration. The court emphasized that the language of the contract provided for such a result and that this was an enforceable liquidated damages clause under New York law.

In 2016, the insolvency and bankruptcy landscape in India was radically overhauled by the introduction of the new Insolvency and Bankruptcy Code (IBC). In addition to consolidating the complex set of existing laws and regulations on insolvency and bankruptcy into a single law, the IBC introduced time bound and creditor driven resolution process for distressed companies overseen by the newly formed National Company Law Tribunal (NCLT).