On April 9, 2015, the lower house of the Polish parliament adopted a new Restructuring Law. The main goal of the new law is to introduce an effective mechanism to restructure a debtor’s business and prevent its liquidation. Generally, the continuation of a business is more favorable to creditors, it preserves jobs and allows the uninterrupted execution of contracts.
On 5 August 2015, the President of the Republic of Poland signed an amendment to the Act of 29 August 1997 on Covered Bonds and Mortgage Banks and related laws (the “Amendment”). These new changes will come into force on 1 January 2016.
Poland’s Supreme Court in a recent ruling found a grant of security for parallel debt to be invalid.
When we last discussed the Commonwealth of Puerto Rico’s efforts to restructure some $72 billion in municipal debt, a Federal District Court Judge had found the Commonwealth’s 2014 municipal debt-restructuring law, the “Recovery Act,” to be pre-empted by the federal Bankruptcy Code, unconstitutional and therefore void.
On September 22, 2017, the First Circuit Court of Appeals reversed the district court, and overruled its own prior guidance, to hold that a committee of unsecured creditors had the right to be heard in adversary proceedings related to the restructuring of Puerto Rico’s debt. The Court’s decision in Assured Guar. Corp. v. Fin. Oversight & Mgmt. Bd. for P.R. (In re Fin. Oversight & Mgmt. Bd.
On February 6th, Federal District Judge Francisco Besosa ruled that Puerto Rico’s municipal debt-restructuring law, the “Recovery Act”, was unconstitutional stating that: “The Recovery Act is pre-empted by the federal Bankruptcy Code and is therefore void.” The Court also permanently enjoined current and future government officials from enforcing the Act. Puerto Rico has announced that it will be appealing the ruling.
We recently published a blog identifying issues which cryptocurrency pose in insolvencies; not least identifying and classifying it, how to take control of it and realising value for the insolvency estate.
Given cryptocurrencies are global, the question of how to classify cryptocurrency on insolvency is not limited to just one jurisdiction.
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.
There has been a significant increase in insolvencies in the construction, real estate, retail and wholesale sectors of the Russian economy, according to the statistics in the Competition Development Bulletin “Concentration on the Russian Markets: Trends in the Period of Recession” published in December 2015 by the Analytical Centre of the Government of the Russian Federation.
Saudi insolvency law has for some time been something of an unknown quantity for non-Saudis. A wide-ranging reform is due to take effect in 2016, which will express elements of the rescue culture and is likely to make restructurings more common. Increased certainty in the outcome of insolvencies will benefit both Saudi businesses and domestic and foreign creditors alike.