One of the blocks of Royal Decree-Law 1/2015, dated 27 February (hereinafter, the “RDL”) envisages the implementation of urgent measures  to reduce the financial burden, introducing amendments mainly in the Insolvency Act, in Royal Decree-Law 6/2012, dated 9 March, concerning urgent measures to protect mortgage debtors without resources, and in Law 1/2013, dated 14 May, concerning measures to strengthen the protection of mortgage debtors, the restructuring of debt and low-income lease.

Significant improvements have been made to creditors’ rights in Russian bankruptcy proceedings by amendments made on January 29, 2015. The Federal Laws No. 432-FZ “On Amending Certain Legislative Acts of the Russian Federation” and No. 482-FZ “On Amending the Federal Law on Insolvency and Administrative Offences Code” (together, the Amending Laws) came into force in Russia. The Amending Laws significantly modify the Federal Law “On Insolvency” and, to a certain extent, improve creditors’ rights in Russian bankruptcy proceedings. Further changes come into force on July 1, 2015.

Chapter 15 of the Bankruptcy Code provides a mechanism for a foreign debtor or representative in non-U.S. insolvency proceedings to protect such debtor’s U.S. assets from U.S. creditors’ collection actions or to stay any litigation commenced in the U.S. The ultimate goal in a chapter 15 proceeding is to preserve the value of the assets of the foreign debtor for the benefit of all its creditors globally.

Say what you will about Detroit’s bankruptcy case, but when it is all said and done, the value for each of its participants most likely lies in the learning experience.   And, experience is sometimes a painful teacher.   One of the many take-aways is a framework for what constitutes a workable or“feasible” plan of adjustment (“Plan” or “Plan of Adjustment”) while recognizing the significant risk of implementation and post bankruptcy performance.

Detroit Highlights

A claim filed by insolvency practitioners requesting the termination of contract of payment in kind, which was entered into between a party under insolvency proceedings and a third party, centred on the giving of a slicer machine in consideration of debt; whether the credit of the defendant was qualified as subordinated as a result of damages resulting from the company’s inability to operation, and for violating the principle of equality among creditors.

The recently-approved Royal Decree Law 4/2014 (RDL), dated March 7 and published March 8 in the Official State Gazette (BOE), has the main goal of addressing measures to ensure the feasible restructuring of corporate debt, encouraging a relief of financial burdens for companies which, despite high debt levels, are still feasible from an operational viewpoint.

Comment

Pension issues in the American Airlines (AMR) bankruptcy¹ have resulted in the Internal Revenue Service (IRS) issuing new final regulations, effective November 8, 2012 (Final Regulations), which broadly impact all debtors facing underfunded pension plan obligations. The Final Regulations provide chapter 11 bankruptcy debtors facing distress terminations of their tax-qualified defined benefit pension plans with the additional option of amending the plans to eliminate accelerated payment options.

The Sixth Circuit is one of only five federal appellate courts to institute a bankruptcy appellate panel under 28 U.S.C. § 158(b).  (The others are the First, Eighth, Ninth, and Tenth circuits.) As the bankruptcy appellate panel is unfamiliar to many non-bankruptcy attorneys, this post will review the Sixth Circuit’s bankruptcy appellate panel. 

The much awaited court decision on the status of Financial Support Directions (“FSDs”) and Contribution Notices (“CNs”) * issued by the Pensions Regulator against target companies after the commencement of English insolvency processes in respect of such targets was handed down by the court on Friday 10 December 2010. The reluctant decision of Mr Justice Briggs that FSDs and CNs in these circumstances were not provable debts but ranked as expenses of the insolvency process, taking precedence ahead of unsecured creditors, has caused dismay in the restructuring community.