Introduction

The Singapore High Court has confirmed that it will recognize the status and powers of a foreign liquidator in the liquidation of an unregistered foreign company in Singapore.

Life cycle of a company

Statistics from the Accounting and Corporate Regulatory Authority ("ACRA") of Singapore reveal that the increasing number of companies formed in Singapore (2004:17,151; 2009:26,414) is matched by a corresponding increase in the number of companies ceasing operations (2004:5,882; 2009:22,388).

Capital markets are the platform on which buyers and sellers, including both individuals and businesses, buy and sell financial securities, such as stocks, bonds and related debt and equity instruments. Capital markets help channel surplus funds from savers to institutions by facilitating an open, transparent and safe environment in which to trade securities. Capital markets consist of primary markets on which new issues of securities are traded, and secondary markets, on which existing or previously-issued securities are traded.

Recent amendments to the Enforcement Procedure and the Interim Protection Act facilitate repayment in enforcement proceedings.

Introduction

Bills of exchange are mostly regulated by the sector specific act of 1946 (based on provisions of three 1930’s Geneva conventions). Provisions of other acts (eg, Obligation Code; Obligacijski zakonik) are used secondarily if the Bill of Exchange Act (Zakon o menici) does not contain applicable provisions.

What is the “fatal flaw” in our law? The Insolvency Act, 1936 (Insolvency Act) has always made provision for the holder of a pledge and cession in security over “marketable securities” (Secured Party), upon the insolvency of the security provider (Security Provider), to immediately realise those marketable securities through or to a stockbroker on a recognised stock exchange. However, in terms of s83(10) of the Insolvency Act (as it currently stands), once the pledged securities have been so realised they must be paid over to the liquidator.

Section 44 of the Companies Act 71 of 2008 governs the instances when a company may provide financial assistance for the purchase of the company's securities. (It is important to note that section 44(1) carves out the application of the entire section 44 for financial assistance given in the ordinary course of business by a company whose primary business is lending money.)

The new company shareholders, who have accessed ownership of the securities by ordinary purchase or by enforcement of a pledge of securities, must beware above all of the hitherto dormant claims of former shareholders and directors.

Royal Decree-Act 11/2017 of 23 June, on urgent measures for financial matters

Swaps market participants accepting cash collateral from an entity subject to Ontario provincial pension benefits legislation will want to consider the implications of this decision on their priority. Unfortunately and somewhat surprisingly, the Supreme Court of Canada did not overturn a key part of the Ontario Court of Appeal’s decision.

Saul Katz and Fred Wilpon, owners of the New York Mets baseball team, invested in Bernard Madoff’s Ponzi scheme. Irving Picard, the trustee appointed under the Securities Investor Protection Act to liquidate the business of Madoff and Madoff Securities, sought to recover over $1 billion from Katz and Wilpon on the grounds that they had made money from Madoff through fraud, constructive fraud and preferential transfers in violation of federal bankruptcy law and New York debtor-creditor law.

2011 ONCA 160 (Released March 2, 2011)

Trustee – Constructive Trust – Fraud – Bankruptcy

In this case, the Court of Appeal for Ontario explained the conditions under which a constructive trust remedy can be granted in favour of defrauded creditors after the fraudster enters into bankruptcy proceedings.