The proposed changes to the Saudi Arabian bankruptcy regime will provide the judiciary the right to obligate creditors to accept a settlement proposed by the debtor (the “new Law”).
The Ministry of Commerce and Investment is currently in the latter stages of reforming the Kingdom’s bankruptcy laws and regulations. The new Law is intended to replace certain sections in the Commercial Court Law and the Bankruptcy Protecting Settlement Law dealing with bankruptcy.
Poland’s Parliament has enacted a new law creating a Borrowers’ Support Fund to help homeowners with mortgages that are underwater. Official statistics by mortgage amount show that 24.3% of mortgages, totaling PLN 84.1 billion (approx. USD 22.7 billion) exceed the value of the borrowers’ homes, affecting 236,400 borrowers.
In a move signaling the end of 6 years of litigation, the bankruptcy trustee for the holding company of failed mortgage lender IndyMac Bancorp, Inc. (“Bancorp”) negotiated a settlement agreement with the FDIC regarding the ownership of nearly $60 million of tax refunds. If approved by the bankruptcy court, the settlement would resolve one of the most highly publicized tax refund disputes involving the FDIC, a number of which arose in the wake of 2008’s financial crisis.
This Act received Royal Assent in July 2007 but no date for implementation has been published yet.
In addition to the provisions contained in this Act aimed at improving the working of the tribunals system and increasing judicial diversity, are several sections that will be of interest to financiers and insolvency professionals:
The rescission was declared of a mortgage the insolvent company granted over a warehouse it owned in guarantee of the loan a credit institution had granted to a company of its group. The Supreme Court declared (i) that the contextual guarantee was for consideration and (ii) the need for proof of the profit (even indirect) of the guarantor company without merely belonging to the group sufficing, and confirmed that the rescission only affected the guarantee and not the loan.
These resolutions clarify the circumstances in which an appraisal certificate is required to create and amend mortgages following the reform of the Rules of Civil Law Procedure under Act 1/2013.
Guarantees granted by a group company for securing a loan used to repay the insolvent party’s personal debts are detrimental to the insolvency estate. Article 10 of the Mortgage Market Act refers solely to mortgages that are already part of an issue of mortgage securities.
From July 21, the reform of rules on prospectuses, intended to establish a common rulebook across the EU to encourage financing through capital markets, will directly apply in Spain.
The remaining credit after the cancelation of its guarantee through an assignment in lieu of payment (dación en pago) in favor of a creditor with a lower-ranking guarantee is an ordinary credit and cannot be subject to a new classification
Rescission of an extension to a mortgage granted by the insolvent company securing a preexisting debt of a company of its group