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Jonathan Addo
Jonathan Addo
  • Jonathan Addo

  • Partner
  • British Virgin Islands
Jeremy Child
Jeremy Child
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Julie Engwirda
Julie Engwirda
  • Julie Engwirda

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Peter Ferrer
Peter Ferrer
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Claire Goldstein
Claire Goldstein
  • Claire Goldstein

  • Partner
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Hazel-Ann Hannaway
Hazel-Ann Hannaway
  • Hazel-Ann Hannaway

  • Partner
  • British Virgin Islands
Nick Hoffman
Nick Hoffman
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Andrew Johnstone
Andrew Johnstone
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Paula Kay
Paula Kay
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Phillip Kite
Phillip Kite
  • Phillip Kite

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Vicky Lord
Vicky Lord
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Paul Madden
Paul Madden
  • Paul Madden

  • Partner
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Henry Mander
Henry Mander
  • Henry Mander

  • Partner
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Ian Mann
Ian Mann
  • Ian Mann

  • Partner
  • Hong Kong
William Peake
William Peake
  • William Peake

  • Partner
  • London
Lorinda Peasland
Lorinda Peasland
  • Lorinda Peasland

  • Consultant
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Chai Ridgers
Chai Ridgers
  • Chai Ridgers

  • Partner
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Nicola Roberts
Nicola Roberts
  • Nicola Roberts

  • Partner
  • Hong Kong
  • Singapore
Paul Smith
Paul Smith
  • Paul Smith

  • Partner
  • Cayman Islands
Andrew Thorp
Andrew Thorp
  • Andrew Thorp

  • Partner
  • British Virgin Islands
Jessica Williams
Jessica Williams
  • Jessica Williams

  • Partner
  • Cayman Islands
Jayson Wood
Jayson Wood
  • Jayson Wood

  • Partner
  • Cayman Islands

10 Minutes With: Rupert Purser, Burford Capital

Funding Corporate Rescue in Asia – Litigation Financing
By Rupert Purser, Senior Advisor, Burford Capital, Asia & Middle East Investments

The role of LITIGATION FINANCE in a rescue

The financing of single, high-value claims held by distressed and insolvent entities is a budding practice offshore and in Asia. But there are further ways in which litigation finance can be used in corporate rescue.  Provided that legal claims have a realisable value sufficient to secure the borrowing, capital provided by a litigation financier can be used for any business purpose – and represent a much-needed source of working capital.

Litigation financing is generally provided on a non-recourse basis and is secured by the legal claims only.  Consequently, the financing will not distort incumbent creditors’ rights or restrict them from further funding the administration. Because litigation financiers do not control the conduct of litigation, their investments do not complicate the turnaround or insolvency practitioner’s conduct over claims and asset recovery.

The growth of LITIGATION FINANCE in Asia

There are a variety of market-based factors driving the growth of litigation finance in Asia and offshore:

  • The offshore corporate structures of many Asian groups enable flexibility in the seat of legal claims and funding agreements
  • Forum shopping is more prevalent as Singapore competes with Hong Kong to become the regional centre for dispute resolution and restructuring and offshore territories play a role
  • Recognition of overseas insolvency processes and appointed insolvency practitioners’ authority is becoming more established, such as from the Cayman Islands, BVI and Bermuda
  • Regional recognition that arbitrations are fundable has opened the opportunity to fund litigation law firms and other participating professional firms across a portfolio of contingency and deferred remuneration mandates (where the litigation financier assumes the risk in success and this is structured to avoid any breach in Law Society rules)
  • The registration of floating charges in Hong Kong and Singapore is rare, thereby leaving open this avenue to provide engaging financiers with adequate security
  • Law reform

To fully utilise this source of financing, practitioners, creditor banks, bond holders, shareholders and other stakeholders should endeavour to engage with litigation financiers early on so that they can be part of the initial strategy to affect the turnaround or corporate recovery solution and not an afterthought.

Boat

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