English Schemes of Arrangement: Points to Note From a Recent Example

Cleary Gottlieb Steen & Hamilton LLP recently represented Far-Eastern Shipping Company plc, a public company incorporated in Russia, and certain of its affiliates in their restructuring of over USD 1 billion of debt. Part of the restructuring involved the negotiation of a compromise arrangement with certain note holders under two series of EU listed U.S. dollar denominated Eurobonds with trust deeds governed by English law. The compromise was implemented by way of an English law scheme of arrangement which was convened with the permission of the High Court of Justice in October 2017 and sanctioned in November 2017. This memorandum provides an insight on a number of issues that were explored at the convening and sanction hearings. Of particular note was the court’s consideration of the interplay between the EU Judgments Regulation and EU Insolvency Regulation.