The SFC has applied to the High Court for an order directing Lehman Brothers Asia Ltd to comply with a SFC notice to produce certain records in connection with its investigation of the offer and marketing of Minibonds. The SFC notice required Lehman Brothers to produce to the SFC all documents relating to the assessment of Minibonds by an internal Lehman Brothers committee. Lawyers for Lehman Brothers objected to the production of certain documents on the ground that such documents were the subject of a claim of legal professional privilege.
GENERAL
The Companies (Winding Up and Miscellaneous Provisions) (Amendment) Ordinance 2016 Gazetted
The Companies (Winding Up and Miscellaneous Provisions) (Amendment) Ordinance 2016 (Amendment Ordinance) was gazetted on 3 June 2016. The Amendment Ordinance aims to improve and modernize Hong Kong’s corporate winding-up regime. The Amendment Ordinance will come into effect on a appropriate date to be published in the Gazette.
Major provisions of the Amendment Ordinance include:
Japan
Report published on ensuring fair and timely disclosure of information to investors. The FSA announced that the Task Force on Fair Disclosure Rule of the Working Group on Financial Markets of the Financial System Council has published the “Report - Ensuring fair and timely disclosure of information to investors.” (3/3/2017)
Hong Kong
SFC released consultation conclusions on supervisory assistance. The Hong Kong Securities and Futures Commission (SFC) released consultation conclusions on proposed amendments to the Securities and Futures Ordinance (SFO). The amendments would provide assistance to regulators outside of Hong Kong upon request by making inquiries and obtaining certain records and documents from licensed corporations or their related corporations. The proposed supervisory assistance will be subject to both existing and new legislative safeguards.
Reconsidering the Lasmos approach to winding-up petitions involving arbitration clauses.
Hong Kong’s notoriously landlord-friendly leases make it hard to renegotiate terms during an economic downturn, tying many tenants into leases well above market values. The territory’s high rents, added to 24 months of declining retail sales, have left retailers in Hong Kong feeling the chill. Many tenants may wish to look beyond their contractual rights and obligations to find a commercial solution. In such difficult circumstances, there are six options retailers could consider.
1. Rent restructure
The Hong Kong court has confirmed that – going forward – the court is ready to recognize and assist a foreign insolvency process conducted in the company’s center of main interests (COMI) and that it will no longer be necessary for the foreign insolvency process to be carried out in a company’s place of incorporation. The judgment sets out a practical roadmap for the future of cross-border insolvency in Hong Kong, where listed companies that use complex holding company structures find themselves in difficulty.
Does an arbitration agreement protect a
debtor from the threat of liquidation?
27 July 2020
The Court of First Instance held in Re Up Energy Development Group Limited [2022] HKCFI 1329 that where the three core requirements for winding-up a foreign company under section 327(1) of the Companies (Winding up and Miscellaneous Provisions) Ordinance (Cap. 32) (CWUMPO) are satisfied, the mere fact that the foreign company has been ordered to be wound up by the court in its place of incorporation is not a ground for the Hong Kong court to decline the making of a winding up order.
A former listco
In several Commonwealth jurisdictions, the corporate legislation allows creditors to petition a court to order the winding up of a debtor in circumstances where that debtor is unable to pay its debts as they fall due. Such legislation generally presumes that the debtor is insolvent if it has failed to comply with a statutory notice requiring the debtor to pay a certain debt within a given period of time (a statutory demand).