On June 9, 2014, the US Supreme Court issued a unanimous decision in Executive Benefits Insurance Agency v. Arkison (“Executive Benefits”)1 that resolved a fundamental bankruptcy procedural issue that had arisen in the wake of Stern v.
On 8 October 2013, the Supreme Court of Vietnam released the most recent draft of the new Law on Bankruptcy ("Draft Bankruptcy Law"). The Draft Bankruptcy Law is now open for comments and, once passed by the National Assembly, will replace the current Law on Bankruptcy 2004 ("Current Bankruptcy Law").
The Draft Bankruptcy Law appears generally to be a positive step in Vietnam's efforts to improve the efficiency of the bankruptcy process and efforts to enhance the credibility of the legal framework for restructuring.
Conduct of Bankruptcy Proceedings
The German Parliament has, in response to the ongoing crisis in the financial markets, extended a legislation, which originally came into force on October 18, 2008, amending, inter alia, parts of the German Insolvency Code. These amendments, which had in certain cases lead to a relaxation of the obligation to file for insolvency, will now be valid without limitation in time. It can be expected that it will be published and come into force already this year.
Obligation to File for Insolvency
On April 19, 2012, the Lehman bankruptcy court handed down its decision on the long-pending motion to dismiss filed by JPMorgan Chase Bank, N.A., in response to Lehman Brothers Holdings Inc.’s $8.6 billion avoidance action against it. The action sought to recover the value of collateral taken by JP Morgan in its role as principal clearing bank to Lehman in the run-up to the Lehman insolvency.
In the much anticipated decision of Belmont Park Investments PTY Limited v BNY Corporate Trustee Services Limited and Lehman Brothers Special Financing Inc [2011] UKSC 38 the Supreme Court has unanimously dismissed the appeal of Lehman Brothers Special Financing Inc (“LBSF”) and in so doing provided clarification as to the scope and application of the anti-deprivation rule (the “Rule”).
On 18 January 2011, the Federal Deposit Insurance Corporation (“FDIC”) issued an interim final rule (the “Rule”) with request for comments regarding certain provisions of Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd- Frank Act”). Title II creates the Orderly Liquidation Authority (“OLA”), which is a mechanism under which “covered financial companies” can be liquidated in a uniform fashion rather than under inconsistent insolvency regimes.
Thailand introduced reforms to its bankruptcy laws in 1998 in the aftermath of the 1997 Asian financial crisis. Those reforms introduced business reorganisation provisions similar to the Chapter 11 provisions of the US Bankruptcy Code. Further amendments have been made to the Thai bankruptcy laws, which are now governed by the Bankruptcy Act BE 2483 (1940) as amended by the Bankruptcy Act (No. 7) BE 2547 (2004).
To promote equal treatment of creditors, the US Congress has armed debtors with the power to bring suit to recover a variety of pre-bankruptcy transfers. Prominent among these is a debtor’s ability under Section 548 of the Bankruptcy Code to recover constructively fraudulent transfers — i.e., transfers made without fair consideration when a debtor is insolvent.
In May 2021, the UK Government published a Consultation which set out its proposals for targeted (but significant) amendments to certain aspects of the existing UK insolvency arrangements for insurers.
The English High Court has rejected a challenge to the CVA proposed by Caffè Nero in a decision that provides guidance on the use of the electronic voting procedure for votes on CVAs, the effectiveness of modifications made to a CVA during the process and the duties of the directors and nominees when considering last minute offers for a business in a restructuring scenario. Mr Justice Green rejected all grounds of challenge brought by Mr Ronald Young, a landlord to Nero Holdings Limited ("NHL").