International Insolvency Review最新文献

This article examines the recent decision of the Hong Kong Court of First Instance in The Joint Liquidators of Bull's-Eye Limited (in Liquidation) v Changjiang Securities Brokerage (HK) Ltd and Others [2024] HKCFI 3000, which highlights Hong Kong's evolving approach to recognition and assistance in cross-border insolvency. The case involved the recognition of insolvency proceedings initiated in the British Virgin Islands, despite the company's likely centre of main interests (COMI) being in Hong Kong. The Court's application of the managerial assistance exception, coupled with its comprehensive handling of regulatory constraints, demonstrates its pragmatic approach to facilitating international insolvency cooperation while respecting local regulatory frameworks. By balancing these considerations, the judgement reinforces Hong Kong's status as a leading jurisdiction for cross-border insolvency. The article analyses the factual and legal context of the case, explores its implications for insolvency practice and considers its potential influence on corporate structuring and insolvency planning in an increasingly interconnected global economy.

The 2023 collapse of Wilko, a prominent UK retail chain, exemplifies the ‘resilience paradox’ in corporate restructuring—a compelling and counterintuitive dynamic within systems, organisations and societies: The very mechanisms that bolster short-term resilience can inadvertently sow the seeds of long-term vulnerability. To solve financial challenges, Wilko secured a £40 million loan from Hilco Capital in early 2023 and implemented cost-cutting measures, including up to 400 job cuts.1 These actions provided short-term stability but led to overreliance on external financing and reduced operational flexibility. Consequently, Wilko entered administration in August 2023, resulting in the closure of all 400 stores and the loss of over 12,000 jobs.2 This case highlights how strategies aimed at immediate resilience can inadvertently increase medium and long-term vulnerabilities, underscoring the complex balance between short-term recovery efforts and long-term sustainability.3

Resilience has long been celebrated as the hallmark of human strength and adaptability.4 Michael Ungar's The Limits of Resilience does not take the Wilko case but challenges this simplistic valorisation by revealing its inherent complexities and paradoxes with other examples. As Ungar argues, resilience is not the panacea; it is often portrayed to be; instead, it is a process laden with trade-offs, contradictions and systemic dependencies. Drawing on real-world examples, such as the evolution of Drayton Valley from an oil-dependent boomtown to a community grappling with diversification, Ungar highlights how resilience can perpetuate unsustainable cycles of recovery that prioritise short-term survival over long-term transformation.5 In light of this idea, resilience becomes a double-edged sword—offering hope and progress for some while exacerbating inequalities or vulnerabilities for others. By interrogating resilience as both an individual and systemic phenomenon, Ungar reframes it as a dynamic interplay of opportunities and costs, urging readers to reconsider its role in fostering equitable and sustainable futures.

Ungar introduces and expands upon several concepts that challenge traditional understandings of resilience. Central to his argument is the ‘resilience paradox’, which describes how the success of one system's resilience can create vulnerabilities in others or even within itself over time. Ungar critiques the dominant view of resilience as mere recovery, framing it instead as a process of adaptive trade-offs—decisions and adjustments made by individuals, communities and systems that inevitably come with costs. He distinguishes between personal resilience, often characterised by individual endurance or ‘bouncing back’, and ‘systemic resilience’, which depends on the interaction of interdependent networks, such as families, governments and economies. Ungar also explores the concept of ‘resilience silos’, where one system's self-contained approach to

The last several decades have seen relatively rapid and innovative changes to the way that companies finance themselves, making the web of debt and credit ever more complicated and technical to unwind when a financial crisis occurs. This has required the modernisation of both global insolvency frameworks and the variety of skills and regulatory requirements for the insolvency profession. The insolvency profession has always been ahead of the game in developing processes to efficiently and effectively deal with financial distress, well in advance of legislative reform. Legislators and policy makers may have a lot to learn from the solutions devised by insolvency practitioners to deal with the modern problems presented by corporate financial distress.

The crises of the recent past, including the economic impact of the COVID19 pandemic, invited a refocusing on how the insolvency profession would deal with the rise of insolvency cases once the safety nets provided during the pandemic were pulled away. Elizabeth Streten of Queensland's University of Technology in Australia explores the modernisation of the insolvency profession and the regulation of its practitioners with a consideration of the challenges faced by the profession in achieving the best outcomes resolving financial distress. Insolvency practitioners have had to deal with a raft of reforms in response to the pandemic and the economic crises it precipitated globally, which called for an examination of the role and practice of insolvency practitioners with the shifts in insolvency practice in mind.

Legal and Ethical Standards in Corporate Insolvency aims to address the dearth of data and understanding of the corporate insolvency profession by examining the role and practice of corporate insolvency practitioner and the challenges that they encounter. This is done through deft comparisons through literature review and empirical studies to provide perspectives on this topic among a number of common law countries. It also provides detailed lessons from corporate insolvency practitioners' perspective and experience through an in-depth empirical analysis of the Australian profession.

Streten first provides a nuanced discussion of the confidence in corporate insolvency practitioners generally and over time, noting that the sophistication of modern recovery processes have led to extensive legal and ethical regulation of the industry to ensure competency and integrity. These requirements have aimed to helped to build confidence in the profession. However, recognising the growing complexity of businesses and corporate financial structures, along with the intertwined nature of the global financial markets, it is not surprising that there is a lack of understanding as to the realities of insolvency practitioner roles and legal obligations. Streten therefore observes that the absence of data in this area is a problem that ‘hinders the ability to properly determine appropriate

In cross-border insolvency cases involving foreign liquidators, Hong Kong courts traditionally adhered to two criteria for recognition and assistance: the collective nature of insolvency proceedings and the commencement of such proceedings in the company's place of incorporation. This approach has evolved following Re Global Brands, marking a shift towards considering the company's COMI as a more practical criterion, and highlighting the impracticalities of using the place of incorporation as the primary criterion. Despite the benefits, the COMI Criterion introduces complexities, such as potential non-recognition and conflicting rulings between jurisdictions. There are also questions surrounding the differences between the principle of modified universalism under common law and the UNCITRAL Model Law. This article analyses the impacts brought about by the transition to the COMI Criterion, and encourages consideration of the adoption of the Model Law by Hong Kong in the future.

This paper examines the evolving discussions on directors’ duties in the insolvency context within the EU, particularly in light of recent harmonisation initiatives such as the 2019 Directive on Restructuring and Insolvency and the 2022 Proposal mandating a duty to file for insolvency. Using empirical data from Austria—a jurisdiction with a duty to file—and the Netherlands, which lacks this duty, the study investigates the potential impact and practicality of such requirements. Findings reveal that while Austria and the Netherlands have different frameworks, similar issues in enforcement and compliance emerge in both. These results suggest that imposing stricter or more explicit norms on directors across the EU may not effectively achieve policy goals, especially if financial constraints on enforcement remain unaddressed. We advocate for a policy approach that focuses on practical outcomes and enforcement capacity.

With the ongoing implementation of personal insolvency practices in China’s mainland, the realization of a nationwide personal insolvency system in China’s mainland no longer appears distant. In the design of specific personal insolvency schemes, key elements to consider are establishing entry criteria, assessing the integrity of debtors, determining the duration of the discharge examination period, setting the length of the blocking period for subsequent insolvencies. Additionally, the availability of a simplified procedure for personal insolvency should also be considered. By analysing 12 official documents from regional practices in China's mainland and comparing them with corresponding regulations in Taiwan Region ("Taiwan") and Hong Kong, we can draw valuable experiences and identify shortcomings. This effort aims to lay the foundation for a unified personal insolvency system in the future of China’s mainland.

Despite much debate on Company Voluntary Arrangements (CVA) among UK retailers, understanding of retail CVAs remains limited. There is continuing uncertainty about the uptake of CVAs, what aspects lead to successful outcomes and whether CVAs can be viewed as a remedy for struggling UK retailers. To address these questions, we developed and analysed a novel and detailed dataset of Companies House records for the population of retailers' CVAs between mid-2012 and early 2021. We find that CVAs, despite detrimental impacts on other actors (landlords and suppliers), can be a useful tool for some retailers in adjusting to the new market conditions. The uptake of CVAs among retailers is stable, though not among large retailers. Retail CVAs help to avoid immediate business failure, but we found limited evidence of the success and efficient longer term outcome of the procedure, suggesting that alternative methods could be considered. The success and efficiency of CVA do not seem to depend on the size of the business, but there are variations in both the uptake and efficiency of CVAs across retail sub-sectors. This suggests that a range of mechanisms are required to cater to the different needs across retail categories. Despite the market challenges, CVAs are not prolonged on average. However, longer duration CVAs seem to have a lower chance of succeeding and of being efficient implying that CVA cannot remedy fundamental business issues. Finally, we observed differences related to who oversees the procedure, suggesting that greater emphasis should be put on upskilling and selection of insolvency practitioners.