Insolvency law & restructuring

Recent Articles

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  29/07/2024

  Hong Kong

  Avoidance rights in Hong Kong

  Hong Kong is a common law jurisdiction, and its legal system is based on English law. Following Hong Kong’s handover to China on 1 July 1997, the Basic Law of Hong Kong is the constitutional document of the Hong Kong Special Administrative Region. Article 8 of the Basic Law provides that: “laws previously in force in Hong Kong, that is, the common law, rules of equity, ordinances, subordinate legislation and customary law shall be maintained, except for any that contravene [the Basic Law], and subject to any amendment by the legislature of the Hong Kong Special Administrative Region.”General...

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  15/07/2024

  England and Wales

  Arbitration agreement does not prevent winding up petition

  The Privy Council has recently delivered a landmark judgment on the interplay between arbitration agreements and winding up petitions. The Board held that the English case of Salford Estates (No 2) Ltd v Altomart Ltd [2014] EWCA Civ 1575; Ch 589, which had adopted a pro-arbitration approach to stay or dismiss winding up petitions based on debts covered by arbitration agreements, even if the debts were not genuinely disputed on substantial grounds was wrongly decided. The Board, although hearing an appeal from the British Virgin Islands (BVI)  also gave a direction that Salford Estates should...

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  12/07/2024

  Singapore

  Vulnerable transactions under Singapore law

  The rules governing corporate and personal insolvency in Singapore are set out in the Insolvency, Restructuring and Dissolution Act 2018 (IRDA), which includes mechanisms to reverse transactions that unfairly deplete a company's assets prior to insolvency, thereby protecting creditors' interests by allowing the value of the company’s assets to be maximised for distribution to its creditors on insolvency.The following article summarises the circumstances in which these vulnerable transactions can be unwound for corporate entities subject to Singapore’s insolvency laws.Transactions at...

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  17/06/2024

  Peru

  Insolvency clawback actions from a Peruvian perspective

  The proposed EU Directive on harmonisation of insolvency law seeks to set minimum standards for exercising avoidance actions in insolvency proceedings in order to safeguard the insolvency estate from unlawful asset transfers before the initiation of insolvency proceedings.In Peru, the insolvency system is administrative rather than judicial. Because the administrative authority has limited powers, preference and avoidance actions must be resolved by the Judiciary. In recent years, the use of these actions has become more frequent.Scope of avoidance actionsUnder the Peruvian Insolvency Law (Law...

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  31/05/2024

  Colombia

  Colombian law provides for avoidance actions to revoke illegitimate acts before and during insolvency proceedings

  'Avoidance action' is an umbrella term for any proceedings that seek to revoke illegitimate acts that diminish the debtor’s assets. These actions aim to protect creditors and maximise the value recovery from the debtor. Colombian law stipulates a variety of avoidance actions before and during insolvency proceedings, notwithstanding criminal liability for the revoked acts.Before insolvency proceedingsArticle 2491 of the Colombian Civil Code provides an avoidance action known as the 'Acción Pauliana', which allows for the rescission of acts executed before the start of insolvency proceedings...

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  10/05/2024

  Sweden

  Avoidance rights in Sweden

  Through the proposed EU Directive on the harmonisation of certain aspects of insolvency law (COM/2022/702), the Commission aims to harmonise member states’ abilities to take avoidance actions for certain types of transactions preceding a bankruptcy. The purpose is to address the deficiencies and differences existing in the insolvency procedures of EU member states. The proposed directive aims at enhancing investor and creditor security regarding cross-border investment activities. The proposal contains minimum standards, thus allowing member states to adopt stricter avoidance rules if such...

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