Recent Developments
In Short
The Situation: Frequently, the statutory moratorium period provided to voluntary administrators to restructure an insolvent company is too short to find a solution. Administrators often utilise "holding" deeds of company arrangement to extend the period of moratorium and "buy" time to investigate potential restructuring opportunities for the future of the company. A creditor recently challenged this industrywide practice by arguing that holding DOCAs are invalid.
The Federal Court of Australia has provided judicial guidance about what constitutes taking possession by seizure under the Personal Property Securities Act 2009 (Cth) ("PPSA"). Knauf Plasterboard Pty Ltd v Plasterboard West Pty Ltd (In Liquidation) (Receivers and Managers Appointed) [2017] FCA 866 indicates that a receiver taking possession of personal property in accordance with a valid security agreement will not perfect a security interest by way of possession.
Background
Background
On 7 December 2015, the Australian Government released its "National Innovation and Science Agenda" ("Agenda"). In the Agenda, the Government outlined its intention to make three significant reforms to Australia's insolvency laws, adopting the recommendations of the Productivity Commission ("Commission") in its report, "Business Set-Up, Transfer and Closure" ("Report"), released on the same day as the Agenda:
Although most western legal systems have recognised for some decades the public benefit in rehabilitating failed enterprises, some countries do it better than others. To some extent, this is because of differences in local legislation (sometimes small, but with far-reaching effects), which either shapes, or is shaped by, popular or political attitudes to business failure.
Key Points
The Netherlands is planning to adopt new restructuring legislation, allowing for court confirmation of extrajudicial restructuring plans (Wet Homologatie Onderhands Akkoord, or WHOA). The bill combines features of the U.S. chapter 11 procedure and the English Scheme of Arrangement. With its broad range of jurisdiction and flexibility, the "Dutch Scheme" will prove to be an effective addition to the restructuring toolbox for both Dutch and non-Dutch entities, for groups of companies, and with the possibility of automatic recognition throughout the European Union.
On 26 June 2019, the new Harmonisation Directive was formally published in the Official Journal of the European Union. As a result, by 17 July 2021, each Member State must include in its respective insolvency and restructuring laws a US Chapter 11-style debtor-in-possession regime which will radically change the future landscape of the European restructuring market.
WHITE PAPER
April 2019
The EU Risk Reduction Package: The Countdown for Restructuring the MREL Base Has Just Begun
In Short:
The Situation: In Bakhshiyeva v Sberbank of Russia, a debtor sought to restructure English law-governed debts pursuant to an Azerbaijani restructuring proceeding. In order to prevent certain dissenting creditors from commencing enforcement proceedings against the debtor in the UK, the debtor asked the English court to provide an indefinite stay.