Guide to Restructuring and Insolvency in Bermuda
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Provisional Liquidation Introduction After the Filing of An
Topic 3 – Provisional Liquidation Introduction After the filing of an application for winding up and while it is pending, the creditor may find that the assets and affairs of the company are in jeopardy and are being dealt with to avoid the consequences of liquidation. Creditors and members would be disadvantaged if the company were eventually wound up: VR Dye & Co v Peninsula Hotels Pty Ltd [1999]. The court therefore has the power, pursuant to the CA, s 472(2), to appoint a provisional liquidator of a company at any time after the filing of a winding up application and before the making of a winding up order. Gives interim control of the company to a liquidator; o It is interim because the control is given until the final determination of the winding up application. The company’s financial position will be examined in its entirety: Constantinidis v JGL Trading Pty Ltd (1995). While provisional liquidation is a significant and useful remedy in particular circumstances, it is in fact rarely used. Provisional liquidation compares with the application by a creditor for an order of interim control of a debtor’s property under s 50 of the BA. Where ASIC is conducting an investigation of a company it is possible to obtain both orders appointing provisional liquidators and asset preservation orders under s 1323 of the CA: ASIC v Oceanic Asset Mnagement Pty Ltd [2015]. Who can apply? Creditor A creditor will be the applicant for an order, in most cases, initially the creditor will need to establish its standing as such. -
SNAPSHOT OFFSHORE Corporate Insolvency & Restructuring Annual Review 2018 Current Trends 2019 Jan-June
SNAPSHOT OFFSHORE Corporate Insolvency & Restructuring Annual Review 2018 Current Trends 2019 Jan-June ANALYSIS OF OFFSHORE PETITION FILINGS AND COURT ORDERS Tony Heaver-Wren Partner | Head of Insolvency & Restructuring Dispute Resolution | Cayman INSOLVENCY PETITIONS IN NUMBERS This Snapshot Report provides an overview of the CONTENTS 1 recent insolvency and restructuring petition filings 2018 2019 to date and resultant court orders in respect of companies Winding up Petitions in six* offshore jurisdictions. Throughout the year, The International Picture 3 Total number of companies in Bermuda, BVI, The Offshore Picture 4 744,255 764,765 2 we closely monitor company notices and petition Analysis of Filings by Jurisdiction Cayman, Guernsey, Isle of Man & Mauritius activity across our network of offshore offices in the Bermuda 5 British Virgin Islands 6 following categories: Cayman Islands 7 Compulsory winding-up Petitions submitted to the Mauritius 9 62 • Compulsory winding up, by shareholders or creditors; Guernsey 9 193 Offshore courts • Conversion of voluntary liquidation to court supervised liquidation; Isle of Man 10 • Schemes of arrangement; and Jersey 11 • Court requests for a reduction of share capital. Compulsory winding-up Orders made by the The key findings that emerge from our full-year, multi-jurisdictional 105 26 Offshore courts review and analysis for 2018 are highlighted and explored further over the following pages, together with commentary on the developments over 2019 to date. Petitions against Asian enterprises incorporated offshore have declined somewhat, although there are still a number of high-profile Average conversion rate of winding-up Petitions individual cases making their way through the offshore courts. -
How to Become an Insolvency Practitioner In
REMUNERATION OF INSOLVENCY PRACTITIONERS The article is provided by Devorah Burns of the national organisation The Insolvency Service, based in London. The Insolvency Service operates under a statutory framework – mainly the Insolvency Acts 1986 and 2000, the Company Directors Disqualifications Act 1986 and the Employment Rights Act 1996. If you have any questions on this article, please send them to the author at Devorah.Burns @insolvency.gsi.gov.uk or [email protected] We welcome further contributions to this series, so if you would like to inform our readers of the regulations for becoming an IP in your jurisdiction, please contact the editors. All you need to know about becoming an Insolvency Practitioner: Great Britain The latest in our series of articles on the legal status and remuneration of insolvency practitioners examines the British rules and regulations Access to to pay an annual fee, which covers the costs Insolvency Practitioners in the profession associated with authorisation and England, Wales & Scotland. regulation. The Insolvency Service is responsible for The Secretary of State (SoS) may authorise EU Directive 2005/36 provides for the the regulation of insolvency practitioners insolvency practitioners, as may seven recognition of professional qualifications working in Great Britain (i.e. England, professional bodies (the RPBs). The RPBs throughout the relevant states and The Wales & Scotland) and the Department for represent accountants, lawyers and those European Communities (Recognition of Enterprise, Trade & Investment in Northern who only work as insolvency practitioners. Professional Qualifications) Regulations Ireland is responsible for the regulation Most insolvency practitioners are 2007 (The Regulations) make provision of insolvency practitioners who work in authorised by one of the RPBs. -
In Short-CR October 03
OCTOBER 2003 RECENT CHANGES IN THE UK AND EU LAW AND THEIR EFFECT ON YOUR BUSINESS In Short...Corporate Restructuring & Insolvency THE ENTERPRISE ACT 2002 — A qualifying floating charge is one which is created by CORPORATE INSOLVENCY PROVISIONS an instrument which expressly states that paragraph 14 of Schedule B1 applies to it or empowers the holder to appoint Background an administrative receiver or an administrator of the company. The corporate insolvency provisions of the Enterprise Act, The company will enter administration and the intended to promote a rescue culture, for which the administration will commence when the appointment of administration and CVA procedures were originally an administrator takes effect. introduced by IA 1986, came into force on 15 September If the company is already in liquidation, it may only 2003. enter administration upon an application by the liquidator The provisions contain substantial amendments to be or the holder of a qualifying floating charge. made to IA 1986, with the majority of the new provisions to be included in Schedules to the Act, including:- Purposes •A new administration régime; • Removal of the floating charge holder’s right to The Enterprise Act replaces the four statutory purposes for appoint an administrative receiver (except for certain which administration orders have been made with one, to capital markets arrangements and public/private rescue the company (i.e. not just the business). Where that is partnership projects where administrative not reasonably practicable, the administrator should receivership is preserved); perform his functions with the objective of achieving a • Abolition of Crown preference in all insolvencies. better result for the company’s creditors as a whole than would be likely if the company had been wound up (without first The New Administration Procedure being in administration). -
(E & W): Remuneration of Insolvency Office Holders- England and Wales
STATEMENT OF INSOLVENCY PRACTICE 9 (E & W): REMUNERATION OF INSOLVENCY OFFICE HOLDERS- ENGLAND AND WALES Contents Paragraphs Introduction 1 The Statutory provisions 2 Administration 2.2 Insolvent Liquidations and Bankruptcies 2.3 Members Voluntary Liquidations 2.4 Voluntary Arrangements 2.5 Receiverships 2.6 Other types of appointment 2.7 Provision of Information when Seeking Fee Approval 3 Provision of Information after Fee Approval 4 Asset Realisations 5 Expenses and Disbursements 6 Payment in full 7 Closure of cases 8 Transitional Provisions 9 Appendices A Full text of the rules relating to the remuneration of office holders in the various types of proceedings covered by this statement of insolvency practice B The Official Receiver’s scale and Schedule 6 to the insolvency rules 1986 C Text of creditors’ guidance notes A creditors’ guide to administrators’ fees A creditors’ guide to liquidators’ fees A creditors’ guide to fees charged by trustees in bankruptcy Voluntary arrangements - a creditors’ guide to insolvency practitioners fees D Suggested format for production of information Effective from 1 April 2007 1 1. INTRODUCTION 1.1 This Statement of Insolvency Practice (SIP) is one of a series issued to licensed insolvency practitioners with a view to maintaining standards by setting out required practice and harmonising practitioners' approach to particular aspects of insolvency. SIP 9 is issued under procedures agreed between the insolvency regulatory authorities acting through the Joint Insolvency Committee (JIC). It was commissioned -
Guide to Debt Relief Orders
Guide to debt relief orders 1 Contents 1. About this guide ...................................................................................................... 3 2. What is a debt relief order? ..................................................................................... 3 3. Who is eligible for a debt relief order? ..................................................................... 4 4. How can you apply for a debt relief order? .............................................................. 5 5. Who will deal with your case? ................................................................................. 6 6. What are your duties when considering a debt relief order? ................................... 6 7. How will a debt relief order affect you? ................................................................... 7 8. What are the restrictions of a debt relief order? ...................................................... 9 9. Debt relief restrictions orders and undertakings ...................................................... 9 10. Debts incurred after the granting of a debt relief order .......................................... 9 11. Insolvency terms – what do they mean? ............................................................. 10 12. Where to go for advice ........................................................................................ 12 13. Related Insolvency Service publications ............................................................. 16 14. Data Protection Act 1998 – How we collect and use information -
Insolvency in the Cayman Islands 2019
GLOBAL PRACTICE GUIDE Defi niti ve global law guides off ering comparati ve analysis from top ranked lawyers Insolvency Cayman Islands Campbells chambers.com CAYMAN ISLANDS LAW AND PRACTICE: p.3 Contributed by Campbells The ‘Law & Practice’ sections provide easily accessible information on navigating the legal system when conducting business in the jurisdic- tion. Leading lawyers explain local law and practice at key transactional stages and for crucial aspects of doing business. LAW AND PRACTICE CAYMAN ISLANDS Law and Practice Contributed by Campbells Contents 1. Market Trends and Developments p.5 5. Unsecured Creditor Rights, Remedies and 1.1 The State of the Restructuring Market p.5 Priorities p.10 1.2 Changes to the Restructuring and Insolvency 5.1 Differing Rights and Priorities Among Market p.5 Classes of Secured and Unsecured Creditors p.10 5.2 Unsecured Trade Creditors p.10 2. Statutory Regimes Governing Restructurings, Reorganisations, Insolvencies and Liquidations p.6 5.3 Rights and Remedies of Unsecured Creditors p.10 2.1 Overview of the Laws and Statutory Regimes p.6 5.4 Pre-judgment Attachments p.10 2.2 Types of Voluntary and Involuntary Financial 5.5 Typical Timeline for Enforcing an Unsecured Restructuring, Reorganisation, Insolvency Claim p.10 and Receivership p.6 5.6 Bespoke Rights or Remedies for Landlords p.10 2.3 Obligation to Commence Formal Insolvency 5.7 Special Procedures or Impediments or Proceedings p.6 Protections That Apply to Foreign Creditors p.10 2.4 Procedural Options p.6 5.8 The Statutory Waterfall of Claims p.10 2.5 Liabilities, Penalties or Other Implications 5.9 Priority Claims p.11 for Failing to Commence Proceedings p.7 5.10 Priority Over Secured Creditor Claims p.11 2.6 Ability of Creditors to Commence Insolvency 6. -
Formal Reorganisation in Australia
Spinning around – Formal Reorganisation in Australia Michael Quinlan Partner Deputy Leader Corporate Insolvency and Restructuring Allens Arthur Robinson 1. Introduction This paper looks at the principal formal reorganisation structures for corporations in Australia and concentrates on those available to financially troubled companies. In Australia, personal and corporate insolvencies are administered under separate legislation. Generally, the word ‘bankrupt’ relates only to individuals. Individual bankruptcy is governed by the Bankruptcy Act and is not considered in this paper. When a company becomes insolvent it may be placed in one of the forms of external administration whereby the directors of the company relinquish control to an insolvency practitioner who conducts the affairs of the company. There are three main forms of external administration available to such companies: (1) voluntary administration (VA): VA is a process begun by the appointment of an administrator to a company which is in financial difficulties (but could possibly be saved), during which the administrator investigates its affairs to recommend to creditors whether it should enter into a Deed of Company Arrangement (DOCA) approved by its creditors, be wound up or revert to normal operation by its directors. A company need not be presently insolvent to enter into VA. The methods by which a company can go into a VA are set out at 2.2 below, but the most common method is for the board to resolve that in the opinion of the directors voting for the resolution, the company is insolvent, or is likely to become insolvent at some future time. (2) receivership: receivership is usually instituted by a secured creditor appointing a receiver to enforce a security. -
Liquidation and Insolvency
Liquidation and Insolvency GP08 February 2014 Insolvency Act 1986 This guidance is available in alternative formats which include Braille, large print and audio tape. For further details please email our enquiries section or telephone our contact centre on 0303 1234 500. Is this guidance for you? This guide will be relevant to you if you: • are a director or secretary of a company • act as an adviser to a company GP08 February 2014 - Version 3.9 Insolvency Act 1986 Page 2 of 26 GBW1Liquidation and Insolvency Contents Introduction Chapter 1. General information Chapter 2. Corporate voluntary arrangements (CVA) including CVA moratoria Chapter 3. In administration’ and ‘administration orders’ - Cases beginning on or after 15 September 2003: In administration Chapter 4. Receivers Chapter 5. Voluntary liquidation Chapter 6. Compulsory liquidation Chapter 7. European cross-border insolvency proceedings Chapter 8. Frequently asked questions Chapter 9. Quality of documents Chapter 10. Further information This guide answers many frequently asked questions and provides information on completing the most commonly used filings relating to this area. The guide is not drafted with unusual or complex transactions in mind. Specialist professional advice may be needed in those circumstances. GP08 February 2014 - Version 3.9 Insolvency Act 1986 Page 3 of 26 Introduction This guidance provides a basic overview of insolvency and liquidation proceedings and more detailed information about the documents that must be delivered to the Registrar of Companies. It summarises some of the rules that apply to corporate voluntary arrangements, moratoria, administrations, receivers, voluntary liquidations, compulsory liquidations and EC regulations. Companies House can assist with queries relating to the delivery of documents to the Registrar. -
Receivership: a Guide for Creditors If a Company Is in Financial Difficulty, a Secured Creditor Or the Court May Put the Company Into Receivership
INFORMATION SHEET 54 Receivership: a guide for creditors If a company is in financial difficulty, a secured creditor or the court may put the company into receivership. This information sheet provides general information for unsecured creditors of companies in receivership. Who is a creditor? You are a creditor of a company if the company owes you money. Usually, a creditor is owed money because they have provided goods or services, or made loans to the company. An employee owed money for unpaid wages and other entitlements is a creditor. A person who may be owed money by the company if a certain event occurs (e.g. if they succeed in a legal claim against the company) is also a creditor, and is sometimes referred to as a ‘contingent’ creditor. There are generally two categories of creditor: secured and unsecured. • A secured creditor is someone who has a ‘charge’, such as a mortgage, over some or all of the company’s assets, to secure a debt owed by the company. Lenders usually require a charge over company assets when they provide a loan. Charges over many types of assets are required to be registered with ASIC. You can find out if a company has a registered charge from ASIC’s Companies Register and obtain a copy of the registered charge, on payment of the relevant fee. • An unsecured creditor is a creditor who does not have a charge over the company’s assets. Employees are a special class of unsecured creditors. In a receivership, in certain circumstances, some of their outstanding entitlements are paid in priority to the debt of the secured creditor. -
Corporate Restructuring: Some Uses and Abuses of Provisional Liquidators
Corporate Restructuring: Some uses and abuses of provisional liquidators A paper for the Chancery Bar Association’s Bermuda Seminar – 10 May 2019 Ian Clarke Q.C. 1. The appointment of “soft touch” provisional liquidators self-evidently has its uses in the context of corporate restructuring, particularly in jurisdictions which do not have an equivalent statutory regime to English administration. 2. The paradigm example of a company, with an essentially profitable business facing immediate, unsatisfiable single-creditor pressure and deciding to take advantage of the protection afforded by being in provisional liquidation with the support of its directors, shareholders and other creditors in order to restructure its business with obvious long- term benefits is easy to imagine, if seldom encountered in practice. At this end of the spectrum, there can be no doubt that provisional liquidation has its (beneficial) use. At the other end of the spectrum (perhaps) is the instance of a provisional liquidation brought about by the directors/majority shareholders in the company, with limited (or no) support from other shareholders and/or from other significant creditors to effect a re-structuring, the outcome of which – in terms of benefits – maybe relatively uncertain in scope or timing. Depending upon one’s standpoint, this may amount to an abuse of the “soft touch” provisional liquidation procedure. 3. The purpose of this paper is not to postulate or debate the detailed, nuanced factual scenario of any particular case, deciding what is useful or abusive but to consider certain aspects which may arise in the context of provisional liquidation which might impact on its usefulness or bear an aspects thought to be abusive. -
What a Creditor Needs to Know About Liquidating an Insolvent Cayman
What a creditor needs to know about liquidating GUIDE an insolvent Cayman company Last reviewed: December 2020 Contents Introduction 3 When is a company insolvent? 3 What is a statutory demand? 3 Is it essential to serve a statutory demand? 3 What must a statutory demand say? 3 Setting aside a statutory demand 4 How may a company be put into liquidation? 4 Official liquidation 4 Provisional liquidation 4 Appointment of liquidator 5 Functions and powers of liquidators 5 Functions and powers of an official liquidator 5 Powers of a provisional liquidator 6 Court order 6 Who may apply? 6 Application 7 Debt should be undisputed 7 When does a company's liquidation start? 7 What are the consequences of a company being put into liquidation? 7 Automatic consequences 7 Restriction on execution and attachment 8 Public documents 8 Other consequences 8 Effect on contracts 8 How do creditors claim in a company's liquidation? 8 Making a claim 8 Currency 9 Contingent debts 9 Interest 9 Admitting or rejecting claims 9 What is a liquidation committee? 9 2021934/78537493/2 BVI | CAYMAN ISLANDS | GUERNSEY | HONG KONG | JERSEY | LONDON mourant.com Establishing the committee 9 Distributions 10 Pari passu principle 10 Excluded assets 10 Order of distribution 10 How are secured creditors affected by a company's liquidation? 10 General position 10 Liquidator challenge 10 Claiming in the liquidation 10 What are preferential debts? 11 Preferential debts 11 Priority 11 What are the claims of current and past shareholders? 11 Do shareholders have to contribute towards