INSOL International The Implications of Brexit for the Restructuring and Insolvency Industry A Collection of Essays The Implications of Brexit for the Restructuring and Insolvency Industry A Collection of Essays A copy of this collection of essays is available in electronic format on the INSOL International website (www.insol.org) and is free for members to download. Copies of this report are available from: INSOL International 6-7 Queen Street, London, EC4N 1SP, UK Tel: +44 (0)20 7248 3333 Fax: +44 (0)20 7248 3384 E-mail: [email protected] www.insol.org Price: £50.00 ISBN: 978-1-907764-22-6 Copyright © No part of this document may be reproduced or transmitted in any form or by any means without the prior permission of INSOL International. The publishers and authors accept no responsibility for any loss occasioned to any person acting or refraining from acting as a result of any view expressed herein. Copyright © INSOL INTERNATIONAL 2017. All Rights Reserved. Registered in England and Wales, No. 0307353. INSOL, INSOL INTERNATIONAL, INSOL Globe are trademarks of INSOL INTERNATIONAL. Published: September 2017 AlixPartners LLP Hogan Lovells Allen & Overy LLP Huron Consulting Group Alvarez & Marsal Jones Day Baker McKenzie BDO King & Wood Mallesons Brown Rudnick LLP Kirkland & Ellis LLP BTG Global Advisory KPMG LLP Clayton Utz Linklaters LLP Cleary Gottlieb Steen & Hamilton LLP Morgan, Lewis & Bockius LLP Clifford Chance LLP Norton Rose Fulbright Conyers Dill & Pearman Pepper Hamilton LLP Davis Polk & Wardwell LLP Pinheiro Neto Advogados De Brauw Blackstone Westbroek PPB Advisory Deloitte LLP PwC Dentons Rajah & Tann Asia DLA Piper RBS EY RSM Ferrier Hodgson Shearman & Sterling LLP Freshfields Bruckhaus Deringer LLP Skadden, Arps, Slate, Meagher & Flom LLP Goodmans LLP South Square Grant Thornton Weil, Gotshal & Manges LLP Greenberg Traurig LLP White & Case LLP Henry Davis York i President’s Introduction It is my pleasure to be able to write this short introductory note to a most interesting collection of essays dealing with Brexit. The cover of the INSOL World (third quarter 2017) publication pictures a clever graphic reflecting the removal from the jigsaw puzzle of one of the stars of the European logo, revealing a Union Jack shining through from below. To what extent will the influence of that famed flag be affected by Brexit? The collection of essays in this publication deals with the effects of Brexit not only domestically but also in some of the European Union Member States and, indeed, internationally. To use a phrase coined in the Canadian contribution authored by Paul Casey et al, it remains to be seen whether the “waves of Brexit" will, once they reach the Canadian shores, be “tiny ripples” or a tsunami. What is fascinating is that while there seems to substantial agreement on what the effect of Brexit will be on the insolvency and restructuring industry in the UK, there appears to be a divergence of views (especially in Europe) as to what the impact of Brexit will be in other jurisdictions. As an interesting addition, the essays also deal with some “lessons from history" which usefully inform the present Brexit experience. My thanks and those of INSOL international go to the respected academics and practitioners who have authored the essays and to the project leader, David Burdette, for undertaking the onerous task of compiling, collating, reviewing and editing what is indeed a most interesting, timely and relevant project. Adam Harris President, INSOL International ii Foreword While I am sure there were many noteworthy things that happened on 23 June 2016, the one event that will forever be remembered as a turning point in the history of the United Kingdom and the European Union, was the decision by the British electorate to leave the EU. Ever since that historic day, hardly a moment has gone by without some mention in the media of “Brexit”, the phrase coined to describe the United Kingdom’s departure from the EU. Whatever your own opinions regarding Brexit may be, political or otherwise, there can be no doubt that it will have some form of impact on the restructuring and insolvency industry – not only in the UK, but also in the EU and other parts of the world. In this Collection of Essays, INSOL International brings you a variety of opinions and viewpoints as to what the implications of Brexit on the restructuring and insolvency industry might be. As centrepiece to the collection, we have an essay dealing with the implications of Brexit on the restructuring and insolvency industry in the UK, seen from a UK perspective. The centrepiece essay by Gerard McCormack and Hamish Anderson was provided to commentators from other parts of the world to provide context for the views we gathered from Europe, The United States, Canada and East Asia and the Pacific Rim. We also thought that there may be some lessons to be learned from history, so we have included brief essays on the dissolution of Czechoslovakia and the re-unification of Germany. As you will no doubt determine for yourselves, the essays make for interesting reading. While no one can at this stage predict with any degree of certainty what will come out of the UK’s departure from the EU, there at least seems to be substantial agreement, as far as restructuring and insolvency goes, as to what the immediate effects will be. There also seems to be substantial consensus in Europe that stakeholders on both sides of the Channel are keen to find a way to continue to engage with the UK as an important jurisdiction for restructuring and insolvency. In other parts of the world it seems to be a case of as one door closes, another opens. Perhaps, as some authors have intimated in their essays, the UK may find itself having access to new markets, no longer shackled by the EU regulations that may have prevented cross-border recognition in the first place. No doubt lawyers, famed for negotiating their way around turbulent waters, will find a way to continue to make the UK an important jurisdiction for restructuring and insolvency in future. This collection of essays was assembled in a relatively short space of time and I would like to thank each and every one of the contributors whose names appear in this publication, for the time and effort they have invested in this project. I would also like to thank Samantha Bewick and Richard Heis (both of KPMG) for their input and guidance in putting together this collection. Finally, I must emphasise that the views expressed in this collection of essays are the personal views of the authors themselves and are not to be taken as representing the views of the institutions they represent or work for. The views in this collection are also not be taken as representing the views of INSOL International, or any of its affiliates or representatives. I hope that you enjoy reading the content of this collection as much as I enjoyed putting it together. It is my sincere wish that this publication will stimulate debate amongst the INSOL membership regarding the wider implications of Brexit for the restructuring and insolvency industry. David Burdette Project Leader September 2017 iii Contributors Essay Title Contributor 1. The Implications of Brexit for the Restructuring Prof. Gerard McCormack and Insolvency Industry in the United Kingdom University of Leeds, UK Hamish Anderson Norton Rose Fulbright LLP, UK 2. Lessons from History The Dissolution of Czechoslovakia Dr. Ernst Giese JUDr. Zuzana Francúzová Giese & Partner, Czech Republic The Re-Unification of Germany Prof. Christoph G. Paulus Humboldt-Universität zu Berlin, Germany 3. The Implications of Brexit for the Restructuring and Insolvency Industry: Views from Europe Introduction Prof. Michael Veder Radboud University / RESOR, Netherlands European Union Prof. Lorenzo Stanghellini University of Florence / Stanghellini Ristori Vigoriti, Italy France Nicolas Partouche Jeantet, France Germany Prof. Reinhard Bork University of Hamburg, Germany Greece Stathis Potamitis POTAMITISVEKRIS, Greece Ireland Jane Marshall Moya Moore McCann FitzGerald, Ireland Netherlands Prof. Michael Veder Radboud University / RESOR, Netherlands Sijmen de Ranitz RESOR, Netherlands iv 4. The Implications of Brexit for the Restructuring and Insolvency Industry: Views from Other Jurisdictions United States of America Daniel Glosband Goodwin Procter LLP / CBInsolvency LLC, USA Hon. Leif Clark (Ret.) CBInsolvency LLC, USA Canada Paul M. Casey Deloitte LLP, Canada Kenneth D. Kraft Paul M. Lalonde Martha Harrison Eric Freilich Dentons Canada LLP East Asia and the Pacific Rim Introduction Scott Butler McCullough Robertson, Australia Australia Scott Butler McCullough Robertson, Australia China (PRC) Kingsley Ong Eleanor Lau Anissa Ng Eversheds Sutherland, Hong Kong Hong Kong Robin Darton Tanner De Witt, Hong Kong Singapore Mark Cheng Matthew Teo Rajah & Tann, Singapore v Contents 1. The Implications of Brexit for the Restructuring and Insolvency Industry in the United Kingdom 1 2. Brexit: Lessons from History 23 The Dissolution of Czechoslovakia 25 The Re-Unification of Germany 29 3. The Implications of Brexit for the Restructuring and Insolvency Industry: Views from Europe 35 Introduction 37 European Union 39 France 43 Germany 51 Greece 55 Ireland 57 Netherlands 63 4. The Implications of Brexit for the Restructuring and Insolvency Industry: Views from Other Jurisdictions 69 United States of America 71 Canada 85 East Asia and the Pacific Rim Introduction 93 Australia 95 China (PRC) 103 Hong Kong (PRC) 109 Singapore 115 Member Associations vi The views expressed in this collection of essays are the personal views of the authors, which are not to be taken as representing the views of INSOL International or any of its affiliates or representatives vii The Implications of Brexit for the Restructuring and Insolvency Industry View from the United Kingdom 1 2 Brexit Essays View from the United Kingdom The Implications of Brexit for the Restructuring and Insolvency Industry in the United Kingdom* Gerard McCormack** and Hamish Anderson*** INTRODUCTION The UK Prime Minister, Theresa May, has famously said that “Brexit means Brexit” but the precise implications of this pronouncement are as yet uncertain.