New York, USA

Second Circuit Holds Bankruptcy Code’s Avoidance Provisions Apply Extraterritorially

By Leslie A. Berkoff, Moritt Hock & Hamroff LLP

On 25 February 2019, the Second Circuit Court of Appeals issued a decision in the case of Picard, trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (“Madoff Securities”). The trustee alleged that Madoff Securities fraudulently transferred property to certain foreign feeder fund customers, who subsequently transferred it to other foreign entities. The trustee sought to recover these funds from the appellees, contending that the transfers were avoidable as fraudulent conveyances pursuant to §548(a)(1)(A) of the Bankruptcy Code, and that they should thus be recoverable under §550(a)(2).

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Rothenburg ob der Tauber, Germany

Highest Court Ruling Saves Costs for Shareholders’ Approval in a German Limited Liability Company (GmbH)

By Dr Angelika Baumhof and Christian Pflaeger, Jakoby Dr. Baumhof - Wirtschaftsprüfer Steuerberater Rechtsanwälte

For a long time, it was uncertain whether a notarised shareholders’ resolution of approval is required in the case of a German limited company (GmbH) selling all or substantially all of its assets. It was clear that a shareholders’ resolution of approval is required, but not its form. On 08 January 2019, the German Federal High Court of Justice (II ZR 364/18) ruled that the legal provision § 179a AktG (German Stock Corporation Act) does not apply by analogy to German limited companies (GmbHs). Section 179a AktG stipulates that the sale of the business of a German stock company requires a notarised resolution of the meeting of the stockholders with not less than a majority of three fourths, otherwise the transaction is null and void.

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industrial area, Linz, Austria

Liquidation Procedures in Austria

By Raffaela Lödl-Klein and Mario Kapp, KAPP & PARTNER Rechtsanwälte GmbH

In addition to founding a company, the dissolution of a company should also be considered. In Austria there are two main procedures used to liquidate an Austrian company:

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Alert Procedure and the Role of Auditors in France

By Carole Hong Tran, FIDAG SARL

Statutory auditors carry out their mission with a long-term perspective and contribute to the prevention of the possible diffculties of the entity they audit. The Law of 01 March 1984, amended by the Act of 10 June 1994, established an alert procedure which consists, for the auditor, of informing company management of any facts likely to jeopardise the business continuity.

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Verona, Italy

New Restructuring EU Directive

By Dr Claudio Ceradini, SLT Strategy Legal Tax

Something new is on the horizon from the European Commission concerning restructuring plans. One of the most interesting pieces of news, but not the only one, from EU Directive 2019/1023 published in the Offcial Journal of the European Union on 26 June 2019, is that absolute priority rule does not seem to be an unbreakable taboo any longer.

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main building of Beverly Hills city hall

Substantive Consolidation, its Application, and the Authority

By Byron Moldo, Ervin Cohen & Jessup LLP

The administration of a receivership or bankruptcy case in the US may include one or more entities. While there may only be one company that is the subject of the case at the inception, a body of law has developed which permits courts, in appropriate circumstances, to include other entities in the case administration for the benefit of creditors. The balance of this article summarises the concept of substantive consolidation, its application, and the authority.

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Brooklyn Bridge, New York City

Chapter 15: Court Permits Foreign Debtors to Access and Transfer Funds in a US Account

By Leslie A. Berkoff, Moritt Hock & Hamroff LLP

On 29 January 2019, Judge Martin Glenn, of the Southern District of New York (SDNY) Bankruptcy Court, in the case of ENNIA Caribe Holding, NY, issued a decision regarding a case pending in Curaçao involving the largest insurance company in Curaçao and St. Maarten. The underlying case was originally filed in 2018 by the Central Bank of Curaçao and St. Marten in Curaçao.

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New Bankruptcy Law in Bosnia & Herzegovina

By Željko Vlačić, SAJIC

Bosnia & Herzegovina is a state composed of two entities, the Republic of Srpska and the Federation of Bosnia & Herzegovina, each of which has its executive, judicial and legislative power, i.e. separate legislation and laws that are not timely synchronised in both entities, although in 95% of cases those laws provide the same legal solutions.

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Insolvency & Bankruptcy Code – Doing Business in India for Foreign Trade Creditors

By Adityar Kumar, Ashwani & Associates

The right of foreign creditors to participate in the winding up of Indian companies is well recognised by the Indian Judiciary. As early as 1961, the Supreme Court of India, in Rajah of Vizianagaram (AIR 1962 SC 500), clarified that foreign creditors have the same right as Indian creditors in winding up proceedings under Indian law. However, considering the immense litigation already pending in courts, it would take almost four to five years for creditors (both domestic and foreign) to be able to recover anything from the company.

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