Harneys lawyers Ian Man, Chai Ridgers and David Smith recently put their heads together to write the offshore chapter in GRR’s Asia-Pacific Restructuring Review 2018 which has now been published.
The GRR is an information service providing cross-border insolvency and restructuring news, who annually compile The Asia-Pacific Restructuring Review which is written by leading restructuring practitioners around the world.
The chapter written by Harneys looks at recent BVI, Cayman Islands and Bermuda case law concerning restructuring and insolvency. In a noteworthy development, the Chief Justice of Bermuda, Ian Kawaley, is now sitting as a judge of the Grand Court of the Cayman Islands. His world renowned reputation for cross border restructuring will add a further level of sophistication to the Cayman Islands, and is a welcome development. The chapter also examines the topical issues with a refreshing critical and honest evaluation of recent cases in light of the economic backdrop of a debt-laden China, with opportunistic funds taking an increasing interest. Issues covered in the chapter include:
- “Light touch” restructuring, whereby management remains in control similar to a debtor in possession regime;
- The viability of resumption of trading proposals and the likelihood of an offshore Court granting restructuring orders;
- Legitimate expectations of stakeholders in an insolvency in light of the democratic/numerical weight of creditors’ rights;
- schemes of arrangement and utilizing offshore law to facilitate a restructuring amongst Hong Kong professionals – cutting edge innovation by offshore practitioners in the face of unprecedented co-operation between the HK and Offshore Courts;
- The brave, but commercial, new boundaries of “common law active assistance” to get the deal done;
- The boundaries of the use of liquidator’s powers to leverage discovery from third parties and the potential for abuse;
- shareholder activism vs the 6 month rule for shareholders before they can take Court action – how do you maneuver around the restrictions to protect shareholder victims?;
- The spectre of the common law rule in Emmadart and certain Cayman Islands provisions to hinder a board’s ability to do its duty, and ingenious offshore practitioner led solutions;
- Migration schemes and Singapore’s historically close connection with the offshore jurisdictions in restructuring;
- New Cayman Islands clawback actions by way of voidable preference payments; and
- Proposed Cayman Island law reform to introduce a dedicated restructuring officer in place of a restructuring provisional liquidator.
The chapter includes analysis on the following cases:
- Re Grant T G Gold Holdings Limited
- Re Demaglass Holdings Ltd
- Up Energy Development Group Limited
- Z-Obee Holdings Limited
- Primeo Fund (in Official Liquidation)
- In the matter of CHC Group Ltd
- Re China Milk Products Group Limited
- Re China Shansui Cement Group Limited
- Re Emmadart Ltd
- Re Weavering Macro Fixed Income Fund Ltd (in Liquidation)
- Natural Dairy (NZ) Holdings Limited
- HSH Cayman I GP Limited
- Uni-Asia Holdings Limited
- Re Fruit of the Loom Ltd
- Re Rica Gold Washing Co
Bermuda law advice is provided through Zuill & Co., an independent Bermudian law firm in exclusive association with Harneys.