FSA supported HMRC in its action to wind up The Freedom SIPP, a SIPP operator. It believed this was appropriate to fulfil its consumer protection objective.

On 14 October 2009 the Government announced a major change to the way in which company buy-backs of debt will be taxed. The change may be relevant to any corporate debt buy-back where debt is being purchased at less than face value, including the exercise of a post-enforcement call option in a securitisation.

The global financial crisis has resulted in many loans trading at below par value. This presents borrowers with an opportunity to purchase their own debt and, therefore, extinguish the debt at a reduced cost.

We have spent a lot of time thinking about landlords being affected by tenants going into administration over the last year. This posting is about a court case where the landlord’s administrators were trying to postpone the tenant’s application to Court for the grant of a new tenancy under the 1954 Act.

The administrators failed in their attempts to defer the 1954 Act proceedings even though it severely affected the value of the property in question and the amount that was going to be paid out to the secured creditor.

The recent Scottish Court Opinion on Scottish Lion’s proposed solvent scheme of arrangement,1 in which it was held that to sanction a solvent scheme there must be a “problem requiring a solution” and, in effect, unanimous creditor approval, was followed by a short hearing on Wednesday 14th October in which Lord Glennie said that he would dismiss the petition for the scheme.

Re Stanford International Bank Limited and others [2009] EWHC 1441 (Ch) provides answers to key questions on the UNCITRAL Model Law on cross-border insolvency. What will courts recognise as a “foreign proceeding”? What types of insolvency practitioners will qualify as “foreign representatives”? Is a company’s “centre of main interests” (COMI) always in the country of its registered office? Linda Ralli considers the practical implications for banks which have lent to foreign companies where they are looking to enforce in England.

Facts

The property industry has seen a dramatic decline in capital values over the last two years with peak to trough falls of approximately 44 per cent compared to a peak to trough decline of approximately 27 per cent during the recession of the early 1990s. This, together with the effect of the challenging economic climate, has led to a number of high profile insolvencies of property owners, developers and occupiers. Given the uncertain economic outlook, it is likely that these trends will continue.

Background

Article 4.1 of Council Regulation (EU) No 1346/2000 of 29 May 2000 on Insolvency Proceedings (the "Regulation") states: "Save as otherwise provided in this Regulation, the law applicable to insolvency proceedings and their effects shall be that of the Member State within the territory of which such proceedings are opened..."

Article 4.2 of the Regulation sets out a non-exhaustive list of the matters which the law of the state of the opening of insolvency proceedings is to determine, including:

Background

Article 4.1 of Council Regulation (EU) No 1346/2000 of 29 May 2000 on Insolvency Proceedings (the "Regulation") states: "Save as otherwise provided in this Regulation, the law applicable to insolvency proceedings and their effects shall be that of the Member State within the territory of which such proceedings are opened..."

Article 4.2 of the Regulation sets out a non-exhaustive list of the matters which the law of the state of the opening of insolvency proceedings is to determine, including:

The Joint Administrators (the “Administrators”) of Lehman Brothers International (Europe) (“LBIE”) announced on Oct. 5, 2009, that they are developing a contractual (i.e., non-judicial) alternative to their proposed Scheme of Arrangement, which is the subject of an appeal following a decision by the High Court in London that it lacks jurisdiction to implement the scheme.

The Prior Proposed Scheme of Arrangement

When a company becomes insolvent (as many have in the last year or so) one effect is that its shares will normally have nil or negligible value and the holder of the shares will therefore normally show a ‘book loss’ on them. Such losses can be relieved against taxable gains in certain circumstances.