Restructuring & Insolvency

In 46 jurisdictions worldwide

Contributing editor Bruce Leonard

2015 Restructuring & Insolvency 2015

Contributing editor Bruce Leonard Cassels Brock & Blackwell LLP

Publisher The information provided in this publication is Law Gideon Roberton general and may not apply in a specific situation. [email protected] Business Legal advice should always be sought before taking Research any legal action based on the information provided. Subscriptions This information is not intended to create, nor does Sophie Pallier Published by receipt of it constitute, a lawyer–client relationship. [email protected] Law Business Research Ltd The publishers and authors accept no responsibility 87 Lancaster Road for any acts or omissions contained herein. Although Business development managers London, W11 1QQ, UK the information provided is accurate as of November George Ingledew Tel: +44 20 7908 1188 2014, be advised that this is a developing area. [email protected] Fax: +44 20 7229 6910

Alan Lee © Law Business Research Ltd 2014 Printed and distributed by [email protected] No photocopying: copyright licences do not apply. Encompass Print Solutions First published 2008 Tel: 0844 2480 112 Dan White 8th edition [email protected] ISSN 1468-3180 CONTENTS

Global Overview 7 Dominican Republic 123 James Watson Mary Fernández and Jaime Senior with Melba Alcántara Freshfields Bruckhaus Deringer LLP Headrick Rizik Alvarez & Fernández Alan W Kornberg England & Wales 131 Paul, Weiss, Rifkind, Wharton & Garrison LLP Catherine Balmond and Katharina Crinson Freshfields Bruckhaus Deringer LLP Argentina 8 Martín Campbell and Fernando Daniel Hernández European Union 147 Marval, O’Farrell & Mairal Anne Sharp and Katharina Crinson Freshfields Bruckhaus Deringer LLP Australia 15 Dominic Emmett and Nicholas Edwards France 158 Gilbert + Tobin Emmanuel Ringeval, Alan Mason and Cristina Radu Freshfields Bruckhaus Deringer LLP Austria 27 Friedrich Jergitsch, Michael Raninger and Carmen Redmann Germany 170 Freshfields Bruckhaus Deringer LLP Franz Aleth and Nils Derksen Freshfields Bruckhaus Deringer LLP Bahamas 37 Randol M Dorsett and Leif G Farquharson Greece 185 Graham Thompson Stathis Potamitis, Eleana Nounou and Alexandros Rokas PotamitisVekris Bahrain 45 Harnek S Shoker Hong Kong 195 Freshfields Bruckhaus Deringer LLP Georgia Dawson Freshfields Bruckhaus Deringer LLP Belgium 52 Geert Verhoeven and Satya Staes Polet Hungary 205 Freshfields Bruckhaus Deringer LLP Kornélia Nagy-Koppány and Abigél Csurdi KNP LAW Nagy Koppany Varga and Partners Bermuda 63 Andrew A Martin India 215 MJM Limited Sandeep Mehta J Sagar Associates Botswana 68 Kwadwo Osei-Ofei Italy 226 Osei-Ofei Swabi & Co Raffaele Lener and Giovanna Rosato Freshfields Bruckhaus Deringer LLP Brazil 73 Bruno Kurzweil de Oliveira and Joel Luis Thomaz Bastos Japan 241 Dias Carneiro, Arystóbulo, Flores, Sanches, Thomaz Bastos Advogados Kazuki Okada, Shinsuke Kobayashi and Daisuke Fukushi Freshfields Bruckhaus Deringer LLP Bulgaria 81 Vladimir Kinkin and Yassen Hristev Lithuania 255 Kinkin & Partners Giedrius Kolesnikovas Motieka & Audzevičius Canada 89 Bruce Leonard Luxembourg 266 Cassels Brock & Blackwell LLP Martine Gerber-Lemaire and Christel Dumont OPF Partners Cayman Islands 97 David W Collier Mauritius 273 Charles Adams Ritchie & Duckworth Latasha Bissessur-Jugroo and Cristelle Parsooramen Banymandhub Boolell Chambers China 106 Frank Li, Allan Chen and Rebecca Lu Mexico 282 Fangda Partners Darío U Oscós Coria and Darío A Oscós Rueda Oscós Abogados Cyprus 115 Maria Kyriacou and Elias Neocleous Andreas Neocleous & Co LLC

2 Getting the Deal Through – Restructuring & Insolvency 2015 CONTENTS

Netherlands 294 South Africa 383 Michael Broeders Claire van Zuylen and Adam Harris Freshfields Bruckhaus Deringer LLP Bowman Gilfillan

Peru 306 Spain 394 Rafael Corzo de la Colina and Giulio Valz-Gen de las Casas Eduard Arruga, Natalia Gómez and Teresa Gutiérrez Miranda & Amado Abogados Freshfields Bruckhaus Deringer LLP

Philippines 314 Sweden 405 Francisco Ed Lim, Gilberto D Gallos and Catherine Anne L Diño Odd Swarting and Ellinor Rettig Angara Abello Concepcion Regala & Cruz Law Offices Setterwalls

Poland 323 Switzerland 413 Krzysztof Żyto, Eliza Szulc-Sierańska, Jakub Łabuz, Christoph Stäubli Radosław Rudnik and Dariusz Zimnicki Walder Wyss Ltd Chajec, Don-Siemion & Żyto – Legal Advisors Thailand 426 Portugal 331 Rapinnart Prongsiriwattana, Suntus Kirdsinsap and Sandra Ferreira Dias and Ana Varela Costa Rawin Herabat Caiado Guerreiro & Associados – Sociedade de Advogados, RL Weerawong, Chinnavat & Peangpanor Ltd

Russia 339 Ukraine 433 Dmitry Surikov, Maria Zaitseva and Svetlana Tolstoukhova Oleg Kachmar and Yuriy Kolos Freshfields Bruckhaus Deringer LLP Vasil Kisil & Partners

Scotland 352 United Arab Emirates 447 Siân Aitken Pervez Akhtar, Tarek El-Assra, William Coleman, CMS Cameron McKenna LLP Mohammad Tbaishat and Rachel Dawson Freshfields Bruckhaus Deringer LLP Singapore 366 Sean Yu Chou, Manoj Pillay Sandrasegara and Mark Choy United States 456 WongPartnership LLP Alan W Kornberg and Claudia R Tobler Paul, Weiss, Rifkind, Wharton & Garrison LLP Slovenia 374 Miha Mušicˇ and Vladka Plohl Quick reference tables 466 Taxgroup pravna pisarna d.o.o.

www.gettingthedealthrough.com 3 Freshfields Bruckhaus Deringer LLP | Paul, Weiss, Rifkind, Wharton & Garrison LLP GLOBAL OVERVIEW

Global Overview

James Watson Freshfields Bruckhaus Deringer LLP Alan W Kornberg Paul, Weiss, Rifkind, Wharton & Garrison LLP

The year 2014 has been one of mixed messages. Global economic growth return of CLOs, have provided a plentiful supply of readily available credit is up on 2013 and projected to accelerate into 2015, yet the OECD has with which to tackle the leveraged loans of yesteryear. Indeed, funds and recently cut forecasts in the face of strengthening geopolitical headwinds other so-called alternative capital providers, keen to invest the considerable (not least the conflicts in Ukraine and the Middle East). The US and the sums raised from investors, have become everyday players in not only the UK have been star performers, showing signs of an entrenched recovery, distressed secondary market but also as providers of primary capital. but the eurozone remains in the doldrums and nervous glances are being And it is vital that those parties have come to the table as traditional cast towards China. The overall picture may be improving but significant bank lenders find themselves embroiled in a storm of regulation and lit- threats abound. igation. On one hand, the sector has been rocked by scandal as details A common theme has been the continuation of exceptionally loose continue to emerge of the alleged manipulation of financial benchmarks monetary policy in Western economies, with interest rates held at historic like LIBOR and FX rates, undermining public trust and resulting in swinge- lows for an unprecedented period of time, bolstered by extensive quanti- ing fines and settlements. On the other, regulators have sought to impose tative easing. The ECB has thus far resisted the latter but, faced with the more stringent capital adequacy and prudential rules to address the sys- grim spectre of deflation, it remains to be seen whether this can continue. temic risks exposed by the financial crisis. In this regard, the outcome of Its weapon of choice to date has been to move interest rates into negative the Asset Quality Review in Europe, due to complete shortly, will be of territory to encourage bank lending, but further cuts recently suggest this great interest to many players in the restructuring market – first, in terms of has met with limited success. shining a light on the health of banks (and indeed economies) throughout In contrast, measures taken in the US and the UK seem to have proved Europe and second, in terms of the probable asset divestitures likely to be more fruitful in kick-starting a recovery. Fears remain that cheap money triggered as banks look to get their house in order. may be fuelling inflated asset prices (particularly in the housing and equity On the legal side, the UK scheme of arrangement continues to be a markets), but growth is at least now underpinned by increasing levels of flexible friend, constrained by little more than the limits of lawyers’ cre- capital investment and productivity. Real wage growth has lagged behind ativity. COMI shifts and amendments to governing law and jurisdiction due to the amount of spare capacity in the economy but finally promises to clauses have both been employed by European companies to allow them rise in the year to come, further strengthening the outlook. access to the versatile English tool. Arguably this trend is driving increased As a result, while eurozone rates continue to fall, the question across harmonisation across Europe as other jurisdictions move to embrace the Channel is when (and by how much) UK rates are set to rise. While ‘cram-down’ and ‘pre-pack’ concepts that have helped to make the UK some have said that a sustained period of interest rates (and low growth) is and the US attractive destinations to implement restructurings. On a sim- the ‘new normal’, it is accepted that a rise will happen. What is less certain ilar topic, 2014 has brought more clarity on the proposed reforms to the is how robust corporate and household finances will prove to be as the QE EC Regulation on Insolvency Proceedings. This includes welcome confir- comfort blanket is removed and borrowing costs climb even a few percent- mation that out-of-court insolvency processes (but not schemes) will be age points. Further, market confidence remains fragile, as evidenced by within scope and that there will be no ‘look-back’ period when establishing the changing sentiment in the run-up to the recent Scottish independence a corporate debtor’s COMI. Proposals with respect to the treatment of cor- vote. As the Bank of England’s forward guidance attests, a delicate and dif- porate groups will no doubt present some tricky issues in practice but are ficult process lies ahead. laudable in principle. At least at the upper end of the corporate market though, concerns about This 2015 edition of Getting the Deal Through – Restructuring & refinancing the infamous ‘wall of debt’ have continued to diminish. The Insolvency outlines the legal framework within which the market operates, liquidity drought of 2008 to 2009 seems a world away as buoyant IPO and as well as the position on key issues for debtors, creditors and other stake- bond markets, coupled with the meteoric rise of non-bank lenders and the holders in each of 46 global jurisdictions.

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