The Cayman Islands Grand Court recently delivered its judgment in Re Shinsun Holdings (Group) Co., Ltd. FSD 192 of 2022 (DDJ) (21 April 2023) (unreported) (the “Shinsun Judgment”) in which the court determined the ultimate beneficial owner of bonds, held through Euroclear, did not have standing or authority to progress a winding up petition as a contingent creditor. In this article, we explore similar cases in other offshore and common law jurisdictions.

Shinsun Judgment and the Cayman Position

This morning, after much anticipation, the Supreme Court has released its judgment in Yan v Mainzeal Property Construction Limited (in liq) [2023] NZSC 113, largely upholding the Court of Appeal's decision, and awarding damages of $39.8m against the directors collectively, with specified limits for certain directors. The decision signals that a strong emphasis on 'creditor protection' is now embedded in New Zealand company law.

The Supreme Court has brought the Mainzeal saga to an end by holding the directors liable and awarding compensation of $39.8 million (plus 10 years of interest). The outcome effectively endorses the lower courts' criticisms of the directors' conduct and awards a similar amount of compensation to that of the High Court in February 2019.

Le 20 juin 2019, le Parlement Européen a adopté une nouvelle directive qui harmonise pour la première fois le droit de l’insolvabilité au niveau européen.

L’attente fut longue avant que le processus de transposition en droit belge n’aboutisse enfin par l’adoption d’un projet de loi en mai 2023, et par la publication de la loi le 7 juin 2023.

La loi, dont le maître mot sera l’efficacité, entrera en vigueur le 1^er septembre 2023.

While the economy continues to look positive on paper, the underlying issues stemming from recent inflation and ever increasing overheads continue to affect businesses. Against this backdrop and a year on from the commencement of the European Union (Preventive Restructuring) Regulations 2022 (SI 380/2022) (“the 2022 Regulations”) on 29 July 2022, it seems auspicious to remind directors of their duties to wind up a company in a timely manner or simply exercise good corporate governance and wind up companies that are no longer operational.

On June, 20 2019, the European Parliament adopted a new directive harmonising insolvency law at a European level for the first time.

It was a long wait before the process of transposition into Belgian law finally came to fruition with the adoption in May 2023, and the publication of the law on June, 7 2023.

The law, whose guiding principle is “efficiency”, will come into force on September, 1 2023.

In the blog post titled ‘Vidarbha Aftermath’, the decision of the Supreme Court of India (“Supreme Court”) in Vidarbha Industries Power Limited v. Axis Bank Limited[1] (“Vidarbha”) was discussed and analysed.

Introduction

Following the UK Supreme Court decision in Sequana¹ at the end of 2022, the New Zealand Supreme Court has now weighed in on the issue of the duties owed by directors of a company in the zone of insolvency in a long-running case involving the liquidation estate of Mainzeal Property and Construction Limited.²

The Government intends to enhance the UK's cross-border insolvency regime with the adoption of the UNCITRAL Model Law on Enterprise Group Insolvency (MLEG) and, after further consideration, Article X of the UNCITRAL Model Law on Recognition and Enforcement of Insolvency-Related Judgments (MLIJ).