On 28 June 2021 the Dutch government initiated a public consultation procedure concerning a legislative proposal intended to make expedited liquidation of legal entities more transparent for creditors. To achieve this goal, the Minister has proposed that the management board of a legal entity should file a number of documents with the Trade Register within 10 days of liquidation and then notify their creditors that they have done so. The proposal also allows for the possibility of disqualifying a managing director who should fail to observe the new rules.

On 12 May 2021, in the first opposed cross-class cram down case, the English High Court sanctioned Virgin Active's restructuring plans, the first to bind landlords to lease compromises.

The decision

While the opposing landlords challenged the valuation evidence advanced by the companies, they did not advance evidence of their own. The court accepted the companies' evidence that:

In Arlington v Woolrych, the failure by a junior creditor to gain the prior written consent of senior creditors pursuant to a Deed of Priority rendered the appointment of administrators invalid.

Facts

In Arlington Infrastructure Ltd (In administration) and another v Woolrych and others [2020] EWHC 3123 (Ch), the Court considered the meaning of a deed of priority entered into between the senior and junior secured creditors of Arlington Infrastructure Limited (AIL). The junior creditors (but not the senior creditor) also held debentures over AIL's subsidiary companies.

Background

In Re North Point Global Ltd, the liquidators of a subsidiary submitted a proof in the CVA of the parent company based upon a claim that certain payments made by the parent to the subsidiary were unlawful preferences. Notably, when the parent's CVA came into effect, the liquidators of the subsidiary had not been appointed.

The much anticipated Corporate Insolvency and Governance Bill (the Bill) was published on 20 May 2020.

The proposed legislation is split into two broad categories: temporary provisions brought about as a result of COVID-19 and permanent provisions which will result in fundamental changes to UK insolvency law. The proposals, both temporary and permanent, reflect a shift towards a more debtor-friendly regime.

Handlungsbedarf und Handlungsoptionen

Regulations

On 21 April 2018, new rules regarding the handling of "group" insolvency proceedings of companies in Germany became effective.

The regulations aimed at better coordination between separate insolvency proceedings, which must be implemented for every company within a group under German insolvency rulings. Prior to the regulations becoming effective, coordination was quite difficult, due to the separate responsibilities of different courts and insolvency administrators.

Amendments to the German Insolvency Act

In a recent judgment, the German Federal Court of Justice (Bundesgerichtshof) took the opportunity to clarify its position on sec. 17(2) German Insolvency Act (Insolvenzordnung, InsO). According to sec. 17(2) InsO a debtor is deemed insolvent if he is unable to pay his debts as they fall due (Zahlungsunfähigkeit).

German insolvency proceedings expose company directors to high risks of personal liability. Claims brought on the basis of sec. 92(2), 93(3) German Companies Act (Aktiengesetz, AktG) and sec. 64 German Limited Liability Companies Act can have disastrous financial consequences. Damages can be in the millions. Therefore many company directors purchase directors’ and officers’ liability insurances (D&O insurance) to protect their personal assets.