The U.S. Supreme Court recently issued its latest bankruptcy opinion in MOAC Mall Holdings LLC v. Transform Holdco LLC, holding that the Bankruptcy Code’s rule against invalidating 363 sales after appeal is not an iron-clad jurisdictional bar, but rather a mere statutory limitation.[1]
In Short
The Situation: The U.S. Supreme Court considered whether § 363(m) of the Bankruptcy Code, which limits a party's ability to undo an asset transfer made to a good-faith purchaser in a bankruptcy case, is jurisdictional.
In a recent decision, the Second Circuit held that only parties with the right to pursue a breach of contract claim under an executory contract or unexpired lease have the right to demand a cure payment in the event the executory contract or lease is assumed by a debtor in bankruptcy, affirming previous decisions by the bankruptcy and district courts, and limiting the scope of Bankruptcy Code § 365(b)(1)(A).
Wandeldarlehen sind ein bewährtes und seit Jahren fest etabliertes Finanzierungsinstrument für Start-ups. Ein Wandeldarlehen ist ein (in aller Regel unbesichertes) Darlehen verbunden mit einem Recht oder auch einer Pflicht zur späteren Wandlung der Darlehensforderung (zzgl. aufgelaufener Zinsen) (zumeist im Zuge der nächsten Finanzierungsrunde) in neu an dem Start-up auszugebende Gesellschaftsanteile. Hierbei werden Wandeldarlehen regelmäßig als flexibles Instrument gewählt, um mit geringem Aufwand eine Finanzierung zu erreichen.
Globalisation means that the effects of a business entering insolvency proceedings rarely stay within the territorial confines of a single jurisdiction; one need only look to the recent cryptocurrency bankruptcies as evidence of this. Cross-border insolvencies are no longer the preserve of large multinational corporation failures. Globalisation and the advent of digitisation mean that even small enterprises have customers, assets, and suppliers in multiple countries. This is particularly so across Asia.
On April 24, 2023, the First Circuit’s opinion in Lac du Flambeau Band of Lake Superior Chippewa Indians v. Coughlin came up for oral argument before the Supreme Court. At issue in this appeal is whether this provision’s “abrogat[ion]” of sovereign immunity “as to a governmental unit,” defined to include any “other … domestic government” in section 101(27), embodies a congressional intention to revoke the sovereign immunity of a Native American tribe with sufficient and obvious clarity to be construed as such a revocation.
Over the past two years, there has been an interesting trend of courts, in certain circumstances, borrowing from principles of insolvency law when determining analogous questions of trust law. Most recently, the private wealth industry has seen this very application in connection with the now infamous proceedings relating to the trust known as the Ironzar II Trust[1].
Below, please find some information on the main private law amendments introduced pursuant to Law on the Amendment of the Enforcement and Bankruptcy Law and Certain Laws (the "Law"), published in the Official Gazette dated 5 April 2023.
The Latest Amendments to the Enforcement and Bankruptcy Law
중국 기업파산법> 제5조 제2항은 “외국법원의 파산 판결, 결정이 채무자의 중국 영역 내의 재산과 관련되어 인 민법원에 승인 및 집행할 것을 신청 또는 청구하는 경우, 인민법원은 중국이 체결하였거나 가입한 국제조약, 또 는 호혜의 원칙에 따라 심사를 진행하여, 중국 법률의 기본원칙에 위배되지 아니하며 국가주권, 안전 및 사회공공 이익을 훼손하지 않으며 중국 영역 내의 채권자의 합법적 권익을 침해하지 않는 경우에는 승인 및 집행 결정을 할 수 있다”고 규정하고 있습니다. 근래에 중국법원들이 이 조항에 근거하여 외국법원의 파산 결정을 승인하는 사례 들이 등장하고 있어 그 구체적인 내용을 소개합니다.
1. 싱가폴 사례 - 하문(厦门)해사법원 사건
On April 19, 2023, the U.S. Supreme Court unanimously held in MOAC Mall Holdings LLC v. Transform Holdco LLC that Section 363(m) of the Bankruptcy Code is not jurisdictional. The decision requires parties timely to invoke that provision, or else risk forfeiting its protections. The decision also continues the Supreme Court’s trend of interpreting statutes to be non-jurisdictional (and thus waivable or forfeitable) in the absence of a clear congressional statement to the contrary.
Background