Insolvency reform: let’s not forget about the scheme of arrangement regime (again!)
In brief
The Supreme Court has held that, in order to open secondary proceedings in England under EC Regulation 1346/2000 on Insolvency Proceedings, the company’s “establishment” within the jurisdiction must be a fixed place of business that is involved in a business activity that consists of dealings with third parties: The T
The case of Highmax Overseas Ltd v Chau Kar Hon Quinton considers the interaction of two issues very relevant to trustees (particularly trustees of trust funds including company shares):Beddoe applications and Bartlett clauses. Reported Court decisions on both issues are thin on the ground, so this case provides helpful insight.
We previously wrote about the Court’s attitude to liquidators’ applications for directions on matters arising in a compulsory winding up (i.e., by the court) under section 200 of the Companies (Winding Up and Miscellaneous Provisions) Ordinance, Cap.
In the recent case of Re Hydrodec Group Plc [2021] NSWSC 755 (Hydrodec) the Supreme Court of New South Wales (NSW Supreme Court or Court) rejected an application by a non-operating holding company, Hydrodec Group Plc (the Company), for recognition of its United Kingdom (UK) debtor-in-possession Part A1 moratorium process (Part A1 Moratorium) and relief from a winding up application being made against the Company in Australia.
The Australian chapter of GRR’s Asia-Pacific Restructuring Review 2021, authored by Herbert Smith Freehills, is now available and reproduced below.
This latest edition covers major Australian legislative developments, transactions and case law relating to restructuring and insolvency in Australia over the past 12 months including:
Legislation
- Temporary COVID-19 insolvency law amendments
- Anti-phoenixing amendments to the Corporations Act
Key restructurings
The Corporate Insolvency and Governance Act 2020 received Royal Assent and is now in force.
The Hong Kong Court of First Instance has declined to prioritise an arbitration agreement where a debtor intended to dispute the existence of a debt without proving there was a bona fide dispute on substantial grounds.
Dayang (HK) Marine Shipping Co., Ltd v. Asia Master Logistics Ltd [2020] HKCFI 311; HCCW 14/2019
Background
In high stakes restructurings, directors can be under significant pressure from different parts of the capital structure to take (or refrain from taking) certain actions. It is critical that the board understands whether it owes duties to members or creditors (or both). For such an important issue, the law has previously been remarkably unclear.
The recent Court of Appeal decision inLBI EHF v Raiffeisen Bank International AG [2018] EWCA Civ 719 affirms the wide discretion of the non-Defaulting Party to determine "fair market value" in accordance with the close-out mechanism under paragraph 10(e)(ii) of the standard Global Master Repurchase Agreement (2000 version) ("GMRA").