It is not uncommon that foreign administrators/ liquidators see the needs to seek enforcement or exercise their power in Hong Kong. The legal position in this regard is by and large aligned with the rest of the common law world in that Hong Kong Courts would recognize and assist foreign liquidators upon conditions being satisfied. The liquidator will then be able to exercise powers as if it were a local liquidator subject to certain limits. Importantly, this includes power to initiate actions.
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.
In the recent case of Re Shum Tung Lam formerly known as Shum Wan Man [2020] HKCFI 1720, the Court of First Instance was asked to clarify the requirements under section 30A(6) of the Bankruptcy Ordinance (Cap. 6) (BO) which governs objections made by creditors or trustees to the automatic discharge of a bankrupt from bankruptcy.
The Situation in Hong Kong
COVID-19 has created unforeseen challenges to businesses all over the world, resulting in many companies being unable to survive the pandemic. Hong Kong has been no exception. In Hong Kong, according to data published by the Hong Kong Government’s Official Receiver’s Office, in the first seven months of the year, 5219 compulsory bankruptcy petitions and 247 compulsory winding-up petitions were presented, representing 13.7% and 5.1% year-on-year increase respectively. The effect of COVID-19 may yet be fully reflected by these figures.
香港的情况
2019冠状病毒病（COVID-19）为全球企业带来了无法预料的挑战，导致许多公司无法幸免于疫情；香港也不例外。根据香港政府破产管理署公布的数据，本年首七个月内共有5219宗强制破产呈请和247宗强制清盘呈请，分别比去年同期增长13.7％和5.1％。这些数字可能仍未能充分反映COVID-19的影响。
鉴于COVID-19大流行产生的严重影响，全球各地政府已经意识到需要采取救济措施。一些普通法司法管辖区已实施临时破产法措施来帮助企业。
当前制度
香港目前没有任何法定的企业拯救制度。相比起英格兰和威尔士的行政程序，美国的第11章制度和新加坡的司法管理程序以及救援资金的优势，陷入财务困境的香港公司只能通过任命清盘人或债务偿还安排计划来进行企业拯救。
因此，香港现行破产制度的主要弊端为：
- 缺乏企业拯救制度
- 缺乏暂缓法律行动的法定权力
- 没有明确承认跨境破产
其他司法管辖区如何将临时措施纳入其破产法制度？
美国，英国和新加坡在COVID-19及其法律影响下对各自的破产法进行了临时的修改。
As the economic and trade exchanges between the Chinese Mainland and Hong Kong have become more frequent, in recent years the number of issues that need to be resolved through cross-border cooperation in bankruptcy cases has also increased.
Changes to the Listing Rules and further consultation on enhancing the effectiveness of the regime
Our tracker contains an overview of changes made in light of the Covid-19 outbreak which impose restrictions on creditor rights, relax debtor obligations to file for insolvency or concern other insolvency-related issues. As you will appreciate, this is a dynamic situation, and both the measures announced and applicable legal framework will continue to evolve in the coming days, weeks and months
The BVI Commercial Court (the Honourable Justice Davis-White QC [Ag]) has recently ordered the appointment of liquidators over Pacific Andes Enterprises (BVI) Limited, Parkmond Group Limited, and PARD Trade Limited (the “Companies”), three BVI incorporated companies forming a key part of the China Fishery Group.
The applications were unsuccessfully contested on the principal ground that the appointment of liquidators would irretrievably damage the prospects of a wider, global restructuring of the Pacific Andes Group.
It may now be easier for Australian insolvency practitioners to carry out investigations and recover assets located in Hong Kong and in mainland China. On 8 February 2018, and for the first time, the High Court of Hong Kong granted an application for recognition and assistance in that jurisdiction for voluntary liquidators of an entity incorporated in the British Virgin Islands.