Standards for Rescue Financing under Singapore schemes of arrangement: Re Attilan Group Ltd.

Research output: Contribution to journalArticleProfessionalpeer-review

Abstract

[Extract]
Singapore’s ambition to strengthen its role as a regional insolvency restructuring hub prompted the financial centre to enact several reforms to the domestic insolvency regime, adopt the UNCITRAL Model Law on Cross-Border Insolvency,
and establish the Judicial Insolvency Network through which judges from 10 jurisdictions met to develop guidelines on establishing protocols for court-to-court communication in insolvency proceedings. The most significant amendments involve incorporating characteristics of US Ch.11 proceedings into domestic schemes. These include an automatic moratorium that can be extended to have a worldwide effect on parties falling within the court’s personal jurisdiction, cram-down of dissenting classes of creditors, and rescue financing.
Under the amended Companies Act, a company seeking to convene a creditors’ meeting regarding a proposed scheme may also apply for priority status for rescue financing. There are four levels of priority status permitted under s.211E(1). These include treating the rescue financing as an expense of the winding up in any subsequent winding up, giving the claim priority over
unsecured and preferential claims in any subsequent winding up, granting a secured interest against the debtor’s property that is subordinate to any existing security against that property, or providing the rescue financing a secured status equal to or higher than an existing secured interest on the debtor’s property
Original languageEnglish
Pages (from-to)257-258
Number of pages2
JournalCompany Lawyer
Volume40
Issue number8
Publication statusPublished - Aug 2019
Externally publishedYes

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