Key Points

• The use by Malaysia Airlines' subsidiary, MAB Leasing Ltd. (incorporated in Malaysia) ("MABL"), in 2021, of an English Scheme of Arrangement (a "Scheme") to compromise its aircraft lease obligations proved that US Chapter 11 is not the only route to a globally recognised compromise of airline leases.
• Airline lessors should now prepare themselves for Schemes (and possibly also other English restructuring processes) as an alternative to Chapter 11.

Background

The collapse of fashion retailer Missguided has prompted official complaints to the Insolvency Service from suppliers who have alleged that the online brand continued trading and ordering new supply despite the prospect of insolvency. Alex Jay spoke to the Guardian and Yahoo! Finance about what the retailer going into administration could mean for suppliers, and the potential for legal action.

In 1907, Robert Baden-Powell, an English soldier, devised the Scout motto: Be Prepared. Upon hearing the Scout motto, someone asked Baden-Powell the inevitable follow-up question.

“Prepared for what?”

“Why, for any old thing,” he replied.

In Scouting for Boys (published in 1908), Baden-Powell wrote that to ‘Be Prepared’ means “you are always in a state of readiness in mind and body to do your duty.” More than a century later, preparedness is still a cornerstone of Scouting.

The High Court has sanctioned the restructuring plan of ED&F Holdings Ltd, providing further clarity on the exercise of its discretion to sanction a plan using cross-class cram down.

Background

At the convening hearing, the court ordered that five creditor and two member class meetings be held. All but one of the creditor classes approved the plan by large majorities.

Sanction hearing

“She has great experience of complex recovery claims” “I was very impressed with her handling of large corporate restructuring proceedings”

Questions & Answers

"Natasha is a powerhouse" "She has a very high capacity to solve problems and provide creative solutions" "She is one of the best lawyers I have worked with"

Questions & Answers

Up Energy Development Group Limited [2022] HKCFI 1329 (date of decision: 6 May 2022)

Introduction

The 3 core requirements are factors considered by the Hong Kong Court when deciding whether to exercise its discretion to wind up a foreign incorporated company in Hong Kong.

In Stephen John Hunt (Liquidator of Marylebone Warwick Balfour Management Ltd) v Richard Balfour-Lynn and others [2022] EWHC 784 (Ch), the High Court decided that the directors of a company which went into liquidation after participating in an ineffective tax avoidance scheme did not breach their fiduciary duties and payments made pursuant to the scheme were not transactions defrauding creditors.

Background

Claims against directors for unsuccessful tax avoidance schemes when their company enters into insolvency is not a new phenomenon, but a very recent case introduces a new potential defence for directors, as our Insolvency and Corporate Recovery specialist Tony Sampson explains.

Why would HMRC challenge a scheme?

Introduction

Through the EU Directive on Restructuring and Insolvency of 20 June 2019 (EUR 2019/1023, “Directive“), the European Union has imposed an obligation on its member states to offer a more attractive and flexible restructuring scheme in their respective local law. The initial deadline to do so had been 17 July 2021. Only a handful of countries (most notably Germany and The Netherlands) had implemented the Directive within the initial deadline, whilst the other countries made use of the possibility to ask for a one year extension.