Can Flat Buyers initiate insolvency proceedings against Builders under the Insolvency & Bankruptcy Code? This question assumes greater significance now because many real estate giants are facing insolvency proceedings in various Company Law Tribunals under the new I & B Code, 2016 across the country. Latest is the case of J.P. Infratech which is one of the largest real estate Developer in North India. Flat buyers are in absolute legal chaos.The ‘locus standi’ of the flat buyers for initiating Insolvency Resolution Process against the defaulting Real Estate Developer Companies is a grey area. Under Chapter II of the I & B Code, 2016, either the Financial Creditor, Operational Creditor or the Corporate Debtor can initiate Insolvency Resolution Process as per Sec.7, 9 and 10 respectively. But the legal question as to whether a flat purchaser who invested his hard earned money for purchasing residential/ commercial flats would come in any of the above … [Read more...] about Can Flat Buyers Initiate Insolvency Proceedings Against Builders Under The Insolvency & Bankruptcy Code?
Insolvency proceedings meaning
As things currently standThe aim of the EC Regulation on Insolvency Proceedings (1346/2000) (Regulation) is to improve the efficiency of insolvency proceedings with cross border aspects. It provides, within the European Union (EU), rules for determining:the proper jurisdiction for a debtor’s insolvency proceedings;the applicable law to be used in those proceedings; andthe mandatory recognition of those proceeding in other EU member states.The primary purpose of the Regulation is to ensure the proper functioning of the European market as it relates to cross border insolvency proceedings and to deter forum shopping. It applies to all EU member states, except Denmark.Summary of the changesThe Regulation is now in the process of being amended and the goal of the amendments is to facilitate the rescue of companies in distress. Ultimately, the amendments are aimed at changing the focus away from liquidation and to focus on restructurings, as well as making cross-border … [Read more...] about New Focus on Cross-Border Restructuring of Groups for the Recast EC Regulation on Insolvency Proceedings
“You cannot properly appraise the real seriousness of that situation unless you are right there in the city. Everything that frugal men and women put aside for years to save for old age, to get security for themselves – everything that they put aside to make the lot of their children a better one than their own, is now likely to be swept away. There is only one way that you can lighten the load of the municipality and that is to take its debt service off for the time being. Specifically, so that you will understand it, what is it in the city of Detroit? Our budget [this year is] $72,200,000; our tax delinquency is $28,000,000—36 percent…I want to express the opinion to you that in the city of Detroit, next year, there will not be enough income to even pay the fundamental services of government, to keep your schools going, your police and fire departments, your health and welfare departments, let alone to take care of the debt services of that city.”Frank … [Read more...] about Subnational Insolvencies and Beyond: If Detroit Can Be Restructured In A Bankruptcy Proceeding, Why Not Argentina?
What are the implications for the European restructuring profession of the continued uncertainty over the UK’s withdrawal from the EU? The High Court gave its judgment in the Article 50 judicial review proceedings on 3 November 2016. The Court decided the UK Government does not have the power under the Crown’s prerogative to give notice pursuant to Article 50 for the UK to withdraw from the European Union. The Government has confirmed its intention to appeal the decision to the Supreme Court. The Supreme Court has said it will accept a leapfrog appeal (avoiding the intermediate step of a Court of Appeal hearing) and has reserved between December 5th and December 8th for the hearing. This will be the first time since the Supreme Court was formed in 2009 that a hearing will take place before all 11 justices, demonstrating the importance of the case.For a longer article explaining the background of the case and discussing … [Read more...] about Brexit By Numbers: Impact on Restructuring and Insolvency
On April 16, 2015, the European Court of Justice (“ECJ”) provided guidance on the interpretation of Article 13 of the EC Regulation on Insolvency Proceedings (the “Regulation”) in the case Lutz v Bäuerle – C-557/13.Pursuant to Article 4.2 of the Regulation, the general rule is that the law of the Member State where the insolvency proceedings are opened determines the rules and procedure for the opening of the proceedings, their conduct and their closure, in particular the rules relating to whether certain legal acts detrimental to all creditors can be voided. An exception to the rule is found in Article 13 of the Regulation, which states that the law of the Member State where the proceedings were opened will not apply when the person who benefited from the act detrimental to all creditors proves that (i) the act is subject to the law of another Member State and (ii) that law does not provide for any means to … [Read more...] about European Court of Justice Rules on Applicable Law in Cross-Border Clawback Proceedings