DOCSLIB.ORG

What a Creditor Needs to Know About Liquidating an Insolvent BVI Company

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text

Load more

What a creditor needs to know about liquidating GUIDE an insolvent BVI company Last reviewed: October 2020 Contents Introduction 3 When is a company insolvent? 3 What is a statutory demand? 3 Written request for payment 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 Qualifying resolution 4 Appointment 4 Liquidator's powers 4 Court order 5 Who may apply? 5 Application 5 Debt should be undisputed 5 When does a company's liquidation start? 5 What are the consequences of a company being put into liquidation? 5 Assets do not vest in liquidator 5 Automatic consequences 5 Restriction on execution and attachment 6 Public documents 6 Other consequences 6 Effect on contracts 6 How do creditors claim in a company's liquidation? 7 Making a claim 7 Currency 7 Contingent debts 7 Interest 7 Admitting or rejecting claims 7 What is a creditors' committee? 7 Establishing the committee 7 2021934/79051506/1 BVI | CAYMAN ISLANDS | GUERNSEY | HONG KONG | JERSEY | LONDON mourant.com Functions 7 Powers 8 What is the order of distribution of the company's assets? 8 Pari passu principle 8 Excluded assets 8 Order of application 8 How are secured creditors affected by a company's liquidation? 8 General position 8 Liquidator challenge 8 Claiming in the liquidation 8 Who are preferential creditors? 9 Preferential creditors 9 Priority 9 What are the claims of current and past shareholders? 9 Do shareholders have to contribute towards the company's debts? 9 Current shareholders 9 Past shareholders 10 Who may be appointed as liquidator? 10 Status 10 Offence 10 Eligibility 10 Overseas insolvency practitioners 10 What are the liquidator's duties? 11 Core duties 11 Duty to report wrongdoing 11 Common law duties 11 Skill and care 11 Fiduciary duties 11 To whom are duties owed? 11 What is the liquidator's role? 11 What are the liquidator's powers? 12 General powers 12 Investigative powers 12 What is a provisional liquidator? 13 Who may apply for appointment? 13 When will a provisional liquidator be appointed? 13 Powers 13 When does the appointment end? 13 May a liquidator's actions be challenged? 14 Who may apply to remove a liquidator? 14 Does set-off apply on insolvency? 14 Does closeout netting apply on insolvency? 14 A brief anatomy of a creditor initiated liquidation process 15 Contacts 17 2021934/79051506/1 BVI | CAYMAN ISLANDS | GUERNSEY | HONG KONG | JERSEY | LONDON 2 mourant.com Introduction One of the main reasons the BVI remains a popular place to establish an asset holding company is that its insolvency laws are creditor friendly and modelled on the English Insolvency Act 1986. Consequently, lenders around the world are comfortable lending money to BVI companies. This guide examines the main things a creditor needs to know about liquidating an insolvent BVI company under the Insolvency Act 2003 (the Act) and the Insolvency Rules 2005 (the Rules). A brief anatomy of a creditor initiated liquidation process is included at the end of this guide. When is a company insolvent? Under the Act, a company is regarded as being insolvent if: • cash flow insolvency: it is unable to pay its debts as they fall due; • balance sheet insolvency: the value of its liabilities exceeds its assets; or • technical insolvency: it is taken to be insolvent (irrespective of its actual solvency) because: ◦ it fails to comply with a valid statutory demand; or ◦ execution of a judgment or other order of a BVI court against it is returned wholly or partly unsatisfied. What is a statutory demand? Written request for payment A statutory demand is a formal written request for the payment of a debt given by a creditor to a debtor. Is it essential to serve a statutory demand? It is not essential for a creditor to serve a statutory demand before applying to appoint a liquidator because a company may be cash flow or balance sheet insolvent. In most cases, it is advisable to serve a statutory demand first because the company will be presumed to be insolvent if it does not satisfy or compound the debt within 21 days of the date of service. If a creditor has an unsatisfied judgment against the company, it may prefer to apply to appoint a liquidator on the grounds of insolvency using the unsatisfied judgment as evidence of the company's inability to pay its debts as they fall due. However, to avoid a potential argument being raised by the judgment debtor that, notwithstanding its failure to satisfy any order or judgment for payment of a liquidated sum, it remains able to pay its debts as they fall due, it is advisable that a statutory demand for the judgment sum be issued as a preliminary step. What must a statutory demand say? A statutory demand must comply, and be served in accordance with, the Rules. It must: • be for a debt which is not less than the statutory minimum amount (currently US$2,000) and which is due and payable at the time of the demand; • be in writing and state the nature of the debt and its amount; • be dated and signed by, or on behalf of, the creditor; • require the debtor to pay the debt or secure or compound it to the reasonable satisfaction of the creditor within 21 days of the date of service; • state that, if the debtor does not comply with it, the creditor may apply to the High Court for a liquidator to be appointed; and • state that the debtor has the right to apply to have it set aside. Where the creditor issuing a statutory demand holds security for the debt, the statutory demand must: • state the full amount of the debt; • state the nature of the security interest; 2021934/79051506/1 BVI | CAYMAN ISLANDS | GUERNSEY | HONG KONG | JERSEY | LONDON 3 mourant.com • state the value which the creditor places on the security interest on the date of the statutory demand; and • claim the full amount of the debt less the amount stated to be the value of the security interest (the balance must be at least equal to the statutory minimum amount of US$2,000). Setting aside a statutory demand An application to set aside a statutory demand must be made within 14 days of the date on which it was served. Where an application is made, the 21 day compliance period ceases to run from the date on which the application is filed. The High Court must set aside a statutory demand if it is satisfied that: • there is a substantial dispute as to whether: ◦ the debt is owing or due; or ◦ a part of the debt (which would reduce the undisputed amount of the debt to less than the statutory minimum amount of US$2,000) is owing or due; • the debtor has a reasonable prospect of establishing set-off, counterclaim or cross claim in an amount that would reduce the debt to less than US$2,000; or • the creditor holds security for the debt and the unsecured portion of the debt claimed is less than US$2,000. The court also has discretion to set aside a statutory demand if it is satisfied that there would be substantial injustice because there is a defect in it or for some other reason. How may a company be put into liquidation? A company may be put into liquidation by a liquidator being appointed by a resolution of the shareholders (i.e. voluntary liquidation) or an order of the High Court (i.e. compulsory liquidation). Qualifying resolution Where a company is insolvent, its shareholders may pass a qualifying resolution to appoint an eligible insolvency practitioner (See Eligibility below) as liquidator unless: • a liquidator has already been appointed by the High Court; or • an application to appoint a liquidator has been made but not yet heard. A qualifying resolution is a resolution passed at a properly held shareholders' meeting by a majority of 75 per cent (or any higher majority specified in the company's memorandum or articles) of the votes cast by the shareholders present and voting. If the company is a regulated person, the BVI Financial Services Commission (the Commission) must be given at least five working days' prior notice (or any shorter period it may agree) of the qualifying resolution. Appointment The proposed liquidator must consent in writing to being appointed before the qualifying resolution is passed, otherwise the resolution is void. The company must give the proposed liquidator notice of appointment as soon as possible once the qualifying resolution has been passed. Liquidator's powers Where a liquidator is appointed by the shareholders under the Act: • the liquidator's powers are limited to: ◦ taking custody and control of the company's assets; ◦ disposing of perishable goods or other assets that will diminish in value if they are not immediately sold; ◦ doing anything necessary to protect the company's assets; and ◦ exercising any other powers of a liquidator the High Court may confer; and • the liquidator may be replaced by the creditors at the first meeting of creditors. 2021934/79051506/1 BVI | CAYMAN ISLANDS | GUERNSEY | HONG KONG | JERSEY | LONDON 4 mourant.com Court order Who may apply? Where a company is insolvent, an application to appoint a liquidator may be made by (among others): • the company; • a shareholder if the High Court has given its prior permission (which it will only give if it is satisfied that, on the face of things, there is a case that the company is insolvent); or • a creditor who can show either that the company is insolvent (on either the cash flow or balance sheet basis) or that it is just and equitable that a liquidator be appointed.
Recommended publications
  • Privileged and Confidential Searching for Deep Pockets

    Privileged and Confidential Searching for Deep Pockets

    Privileged and confidential IN AVONWICK V SHLOSBERG [2017] CH 210, MR JUSTICE serlespeakISSUE NO.21 ARNOLD REJECTED THE WIDELY HELD ASSUMPTION THAT A TRUSTEE-IN-BANKRUPTCY SIMPLY ‘STOOD IN THE SHOES’ OF THE BANKRUPT AS REGARDS HIS RIGHTS OF PRIVILEGE. I am pleased to introduce this new edition of Serlespeak on As the Court of Appeal determined in issues in the law of insolvency. upholding that decision, the trustee In my and Sophie Holcombe’s cannot use the bankrupt’s documents joint lead article, we discuss the “in a way which amounts to a waiver of scope of remedies under s.241, the privilege”. In a further decision made Insolvency Act, for transactions in the same proceedings, Re Webinvest Ltd (In Liquidation) [2017] EWHC 2446 at undervalue and preferences. (Ch), Arnold J has also considered the Taking up the theme of obligations of confidentiality to which an transactions at undervalue, officeholder is subject. Three significant Adrian de Froment in his article practical points emerge for officeholders considers the territorial reach of and their advisers from these decisions. claims under s.423. Moving on, First, trustees will need to exercise Ruth den Besten highlights the breadth of potential ramifications of greater caution before instructing the the Supreme Court’s judgment in Lehman, while Matthew Morrison petitioning creditor’s solicitors. This is focuses on the implications of the judgment in the Carlyle case because, if they review the bankrupt’s for directors’ duties when companies are in financial difficulties. As a matter of principle, though, it seems privileged documents, it will either Finally, James Mather examines aspects of an officeholder’s amount to a de facto sharing of their clear that the de facto blanket sharing of compulsorily obtained material through obligations in relation to privileged or confidential materials.
  • CVA" Stands for a Number of Things, Including "Cerebro

    CVA" Stands for a Number of Things, Including "Cerebro

    COMPANY VOLUNTARY ARRANGEMENTS Michael Howlin, Q.C. Hastie Stable, Edinburgh 1. Introduction 1.1 The abbreviation "CVA" stands for a number of things, including "cerebro- vascular accident" (i.e., a stroke), "Creative Video Associations" (a company which recycles videotape), an organisation called "Croydon Voluntary Action", "credit value adjustment" (or indeed "counterparty valuation adjustment") in the context of banking, and a device known as a "controlled valve actuator". It also stands for "company voluntary arrangement", which is the subject-matter of this talk. 1.2 Recent high-profile examples of CVAs include those proposed by (the late) JJB Sports (for the second time), Blacks, Clinton Cards, PT McWilliams (a Northern Ireland engineering company), Oddbins (no explanation needed), Carvill Group (a Northern Ireland construction company) and McTavish 2 Ramsay, the Dundee door manufacturers. Even more recently, we have had the failed Glasgow Rangers CVA and CVAs for Travelodge and Fitness First. 2. The General Statutory Background 2.1 CVAs were created by the Insolvency Act 1986, which devoted all of seven sections to them. Since 2003, they have been governed by slightly expanded primary statutory provisions1 and a new Schedule (Schedule A1) to which I shall return shortly. There are also provisions in Part I of the Insolvency (Scotland) Rules 1986, as amended. 2.2 Section 1(1) defines a voluntary arrangement simply as "a composition in satisfaction of [the company's] debts or a scheme of arrangement of its affairs2". In practice, a CVA is a very flexible affair, the details of which will vary from case to case. Examples of what can be achieved by a CVA include: (1) unconditional foregiveness of debts, or certain classes of debts; (2) pro rata reduction (or partial reduction) of liabilities, or certain classes of liabilities; (3) other variations of liabilities (e.g.
  • Questionnaire for Official Committee of Unsecured Creditors*

    Questionnaire for Official Committee of Unsecured Creditors*

    QUESTIONNAIRE FOR OFFICIAL COMMITTEE OF UNSECURED CREDITORS* In Re: Please Type or Print Clearly. I am willing to serve on a Committee of Unsecured Creditors. Yes ( ) No ( ) A. Unsecured Creditor's Name and Contact Information: Name: ___________________________________________ Phone: __________________ Address: ___________________________________________ Fax: __________________ ___________________________________________ E-mail: _____________________________________________________________________________ B. Counsel (If Any) for Creditor and Contact Information: Name: ___________________________________________ Phone: __________________ Address: ___________________________________________ Fax: __________________ ___________________________________________ E-mail: _____________________________________________________________________________ C. If you have been contacted by a professional person(s) (e.g., attorney, accountant, or financial advisor) regarding the formation of this committee, please provide that individual’s name and/or contact information: _____________________________________ _____________________________________ _____________________________________ D. Amount of Unsecured Claim (U.S. $) __________________________ E. Name of each debtor against whom you hold a claim: ____ __________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ∗ Note: This is not a proof of claim form. Proof
  • UK (England and Wales)

    UK (England and Wales)

    Restructuring and Insolvency 2006/07 Country Q&A UK (England and Wales) UK (England and Wales) Lyndon Norley, Partha Kar and Graham Lane, Kirkland and Ellis International LLP www.practicallaw.com/2-202-0910 SECURITY AND PRIORITIES ■ Floating charge. A floating charge can be taken over a variety of assets (both existing and future), which fluctuate from 1. What are the most common forms of security taken in rela- day to day. It is usually taken over a debtor's whole business tion to immovable and movable property? Are any specific and undertaking. formalities required for the creation of security by compa- nies? Unlike a fixed charge, a floating charge does not attach to a particular asset, but rather "floats" above one or more assets. During this time, the debtor is free to sell or dispose of the Immovable property assets without the creditor's consent. However, if a default specified in the charge document occurs, the floating charge The most common types of security for immovable property are: will "crystallise" into a fixed charge, which attaches to and encumbers specific assets. ■ Mortgage. A legal mortgage is the main form of security interest over real property. It historically involved legal title If a floating charge over all or substantially all of a com- to a debtor's property being transferred to the creditor as pany's assets has been created before 15 September 2003, security for a claim. The debtor retained possession of the it can be enforced by appointing an administrative receiver. property, but only recovered legal ownership when it repaid On default, the administrative receiver takes control of the the secured debt in full.
  • Secured Financing and Priorities Among Creditors

    Secured Financing and Priorities Among Creditors

    University of Chicago Law School Chicago Unbound Journal Articles Faculty Scholarship 1979 Secured Financing and Priorities among Creditors Anthony T. Kronman Thomas H. Jackson Follow this and additional works at: https://chicagounbound.uchicago.edu/journal_articles Part of the Law Commons Recommended Citation Anthony T. Kronman & Thomas H. Jackson, "Secured Financing and Priorities among Creditors," 88 Yale Law Journal 1143 (1979). This Article is brought to you for free and open access by the Faculty Scholarship at Chicago Unbound. It has been accepted for inclusion in Journal Articles by an authorized administrator of Chicago Unbound. For more information, please contact [email protected]. Secured Financing and Priorities Among Creditors* Thomas H. Jacksont and Anthony T. Kronmant One of the principal advantages of a secured transaction is the protection it provides against the claims of competing creditors. A creditor asserting a security interest in his debtor's property is likely to find himself in competition with a wide assortment of other claimants. For example, his security interest may be challenged by another creditor with a consensual security interest, by a creditor with a judgment or execution lien, by a creditor claiming a right to the collateral under some general statutory entitlement such as a repair- man's lien, by a seller to or a buyer from the debtor, or by the debtor's trustee in bankruptcy. To a considerable extent, the value of a security interest depends upon the degree to which it insulates the secured party from the claims of the debtor's other creditors.1 Article 9 of the Uniform Commercial Code contains detailed rules for resolving conflicts between secured creditors and various third parties-rules that tell the secured party what he must do in order to prevent his security interest from being overridden by a competing claimant, or, conversely, what a competitor must do in order to cir- cumvent an existing security interest in the debtor's property.
  • Creditor Control of Corporations Operating Receiverships Corporate Reorganizations Chester Rohrlich

    Creditor Control of Corporations Operating Receiverships Corporate Reorganizations Chester Rohrlich

    Cornell Law Review Volume 19 Article 3 Issue 1 December 1933 Creditor Control of Corporations Operating Receiverships Corporate Reorganizations Chester Rohrlich Follow this and additional works at: http://scholarship.law.cornell.edu/clr Part of the Law Commons Recommended Citation Chester Rohrlich, Creditor Control of Corporations Operating Receiverships Corporate Reorganizations, 19 Cornell L. Rev. 35 (1933) Available at: http://scholarship.law.cornell.edu/clr/vol19/iss1/3 This Article is brought to you for free and open access by the Journals at Scholarship@Cornell Law: A Digital Repository. It has been accepted for inclusion in Cornell Law Review by an authorized administrator of Scholarship@Cornell Law: A Digital Repository. For more information, please contact [email protected]. CREDITOR CONTROL OF CORPORATIONS; OPERATING RECEIVERSHIPS; COR- PORATE REORGANIZATIONS* CHESTER RoHRmicnt A corporation is, on a smaller scale (in some instances on a larger scale), like the political state, in that beneath the cloak of its unity there is a continuous, at times active but more frequently passive, struggle for power among the various groups in interest. Some of these groups, such as the public that deals with it or the employees who work for it, have as yet achieved only the the barest minimum of legal right to control its destinies.' In the arena of the law, the traditional conflict is between the stockholders2 and the creditors. There is an increasing convergence of interest between these two groups as the former become more and more "investors" rather than entrepreneurs, and the latter less and less inclined, or able, to stand on the letter of their bond'3 both are in the last analysis dependent *This article is the substance of one of the chapters of the author's forthcoming book THE LAW AND PRACTICE OF CORPORATE CONTROL.
  • Partially Secured Creditors: Their Rights and Remedies Under Chapter XI of the Bankruptcy Act John C

    Partially Secured Creditors: Their Rights and Remedies Under Chapter XI of the Bankruptcy Act John C

    Louisiana Law Review Volume 37 | Number 5 Summer 1977 Partially Secured Creditors: Their Rights and Remedies Under Chapter XI of the Bankruptcy Act John C. Anderson Repository Citation John C. Anderson, Partially Secured Creditors: Their Rights and Remedies Under Chapter XI of the Bankruptcy Act, 37 La. L. Rev. (1977) Available at: https://digitalcommons.law.lsu.edu/lalrev/vol37/iss5/2 This Article is brought to you for free and open access by the Law Reviews and Journals at LSU Law Digital Commons. It has been accepted for inclusion in Louisiana Law Review by an authorized editor of LSU Law Digital Commons. For more information, please contact [email protected]. PARTIALLY SECURED CREDITORS: THEIR RIGHTS AND REMEDIES UNDER CHAPTER XI OF THE BANKRUPTCY ACT John C. Anderson* Discussions of the rights of secured creditors under the Bankruptcy Act are conspicuous by their absence.' Ironically, the Act speaks the least about those creditors receiving the most.2 In bankruptcy liquidation cases under Chapters I-VII of the Bankruptcy Act, secured claims are entitled to the highest priority, being paid in preference to all other claims and 3 administrative expenses when the security for such claims is liquidated. Since most bankrupt estates are heavily encumbered by mortgages and liens, nearly all of the assets of the estates, after being liquidated, are paid toward secured claims. Accordingly, after the payment of secured debts, administrative expenses and then priority claims, there is usually little or nothing left to pay dividends to unsecured creditors. While there is a paucity of discussion about secured creditors in liquidation proceedings, similar discussions of the rights and remedies of secured creditors in arrangements under Chapter XI of the Bankruptcy Act are virtually nonexistent.4 Once again, secured creditors are integral par- * Member, Baton Rouge Bar.
  • Overview of the Fdic As Conservator Or Receiver

    Overview of the Fdic As Conservator Or Receiver

    September 26, 2008 OVERVIEW OF THE FDIC AS CONSERVATOR OR RECEIVER This memorandum is an overview of the receivership and conservatorship authority of the Federal Deposit Insurance Corporation (the “FDIC”). In view of the many and complex specific issues that may arise in this context, this memorandum is necessarily an overview, but it does give particular reference to counterparty issues that might arise in the case of a relatively large complex bank such as a significant regional bank and outlines elements of the FDIC framework which differ from a corporate bankruptcy. This memorandum has three parts: (1) background on the legal framework governing FDIC resolutions, highlighting changes and developments since the 1990s; (2) an outline of six distinctive aspects of the FDIC approach with comparison to the bankruptcy law provisions; and (3) a final section illustrating issues and uncertainties in the FDIC resolutions process through a more detailed review of two examples – treatment of loan securitizations and participations, and standby letters of credit.1 Relevant additional materials include: the pertinent provisions of the Federal Deposit Insurance (the "FDI") Act2 and FDIC rules3, statements of policy4 and advisory opinions;5 the FDIC Resolution Handbook6 which reflects the FDIC's high level description of the receivership process, including a contrast with the bankruptcy framework; recent speeches of FDIC Chairman 1 While not exhaustive, these discussions are meant to be exemplary of the kind of analysis that is appropriate in analyzing any transaction with a bank counterparty. 2 Esp. Section 11 et seq., http://www.fdic.gov/regulations/laws/rules/1000- 1200.html#1000sec.11 3 Esp.

  • Bankruptcy a Guide for Unsecured Creditors Association Ofbusiness Recoveryprofessionals BANKRUPTCY BANKRUPTCY

    Bankruptcy a guide for unsecured creditors Association ofBusiness RecoveryProfessionals BANKRUPTCY BANKRUPTCY Who can be made bankrupt? Bankruptcy An individual Only individuals can be made bankrupt. Bankruptcy does not apply to companies or partnerships, although individual members of a is made bankrupt as a result partnership can be made bankrupt. of a petition presented to How is an individual made bankrupt? Only individuals An individual is made bankrupt as a result of a can be made the court, usually because petition presented to the court, usually because bankrupt he cannot pay his debts. The debtor, one or more of his creditors or the supervisor of a he cannot pay his debts. voluntary arrangement, amongst others, may present a bankruptcy petition. A licensed insolvency practitioner has given you this The purpose of the bankruptcy order is to appoint a responsible because you, or your business, may be owed money person who has a duty to collect the bankrupt's assets and by a private individual or a sole trader who has distribute them to his creditors in accordance with the law. become bankrupt. This guide aims to help you understand your rights Who is appointed to deal with the bankrupt’s estate? as a creditor and to describe how best these rights Once a bankruptcy order is made, the court will usually appoint the Official Receiver to administer a bankrupt’s estate. The Official can be exercised. It is intended to relate only to Receiver is a civil servant and an officer of the court. The Official England and Wales. It is not an exhaustive statement Receiver must then decide within twelve weeks of the bankruptcy of the relevant law or a substitute for specific order whether to call a meeting of creditors to appoint a licensed professional or legal advice.
  • The Unsecured Creditor's Bargain: a Reply, 80 Va

    The Unsecured Creditor's Bargain: a Reply, 80 Va

    Fordham Law School FLASH: The Fordham Law Archive of Scholarship and History Faculty Scholarship 1994 The nsecU ured Creditor's Bargain: A Reply Susan Block-Lieb Fordham University School of Law, [email protected] Follow this and additional works at: http://ir.lawnet.fordham.edu/faculty_scholarship Part of the Law Commons Recommended Citation Susan Block-Lieb, The Unsecured Creditor's Bargain: A Reply, 80 Va. L. Rev. 1989 (1994) Available at: http://ir.lawnet.fordham.edu/faculty_scholarship/740 This Article is brought to you for free and open access by FLASH: The orF dham Law Archive of Scholarship and History. It has been accepted for inclusion in Faculty Scholarship by an authorized administrator of FLASH: The orF dham Law Archive of Scholarship and History. For more information, please contact [email protected]. THE UNSECURED CREDITOR'S BARGAIN: A REPLY Susan Block-Lieb* INTRODUCTION U UNLIKE Law and Economics scholars who view secured lend- ing as a consensual relationship benefiting not only debtors and their secured parties but also the debtors' unsecured creditors, Lynn LoPucki describes secured transactions as a subsidy because they benefit debtors and their secured creditors at the expense of unsecured creditors. He believes security "is an institution in need of basic reform" because it "tends to misallocate resources by imposing on unsecured creditors a bargain to which many, if not most, of them have given no meaningful consent."' He divides these unsecured creditors into two groups: involuntary creditors, and
  • Memorandum of Law for the International Swaps and Derivatives Association, Inc

    Memorandum of Law for the International Swaps and Derivatives Association, Inc

    MEMORANDUM OF LAW FOR THE INTERNATIONAL SWAPS AND DERIVATIVES ASSOCIATION, INC. Validity and Enforceability under the Law of the British Virgin Islands of Collateral Arrangements under the ISDA Credit Support Documents 17 June 2013 Harney Westwood & Riegels Craigmuir Chambers P.O. Box 71 Road Town, Tortola British Virgin Islands Tel: +1 284 494 2233 Fax: +1 284 494 3547 www.harneys.com [email protected] RW/019603.0013 VALIDITY AND ENFORCEABILITY UNDER THE LAW OF THE BRITISH VIRGIN ISLANDS OF COLLATERAL ARRANGEMENTS UNDER THE ISDA CREDIT SUPPORT DOCUMENTS In this memorandum we consider the validity and enforceability under the law of the British Virgin Islands of collateral arrangements entered into under: 1. the 1994 ISDA Credit Support Annex governed by New York law (the “NY Annex”); 2. the 1995 ISDA Credit Support Deed governed by English law (the “Deed” and, together with the NY Annex, the “Security Documents”); and 3. the 1995 ISDA Credit Support Annex governed by English law (the “Transfer Annex” and, together with the Security Documents, the “Credit Support Documents”); in each case, when entered into to provide credit support for transactions (“Transactions”) entered into pursuant to an ISDA master agreement (the “Master Agreement”)1. Capitalised terms used and not defined in this memorandum have the meanings given to them in the Master Agreement or the relevant Credit Support Document. For convenience, the term “pledge”, when used in this memorandum, is meant to refer to any form of security interest that may be created under a Security Document, although the precise nature of the interest will vary depending on the governing law, nature of the collateral and other relevant circumstances.
  • Kenya Australia Denmark Belgium

    Kenya Australia Denmark Belgium

    CHAMBERS Global PracticeAUSTRALIADENMARK GuidesBELGIUMKENYA Insolvency LAW AND PRACTICE: p.<?>p.3 Contributed by HerbertAnjarwallaGorrissenVan Bael Smith & Federspiel &Bellis Khanna Freehills LawThe ‘Lawand &Practice Practice’ sections – Kenya provide easily accessible information on navigating the legal system when conducting business in the jurisdic- tion. LeadingContributed lawyers explain by local law and practice at key transactional stages and for crucial aspects of doing business. stagesAnjarwalla and for crucial & Khannaaspects of doing business. DOING BUSINESS IN AUSTRALIA:KENYA:DENMARK:BELGIUM: p.<?>349 Chambers & Partners employ a large team of full-time researchers (over 140) in their2018 London office who interview thousands of clients each year. This section is based on these interviews. The advice in this section is based on the views of clients with in-depth international experience. KENYA LAW AND PRACTICE: p.3 Contributed by Anjarwalla & Khanna 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 KENYA Contributed by Anjarwalla & Khanna Authors: Sonal Sejpal, James Mungai Law and Practice Contributed by Anjarwalla & Khanna CONTENTS 1. Market Trends and Developments p.5 4.5 Special Procedural Protections and Rights for 1.1 Changes to the Restructuring and Insolvency Secured Creditors p.12 Market