Last year, in Bailey & Anor (As Foreign Representatives of Sturgeon Central Asia Balanced Fund Ltd), Re [2019] EWHC 1215 (Ch), [2019] WLR (D) 297, Mrs Justice Falk held, under the Cross-Border Insolvency Regulations 2006 (which implement the UNCITRAL Model Law for Cross-Border Insolvency), that it was appropriate to recognise as a foreign proceeding the liquidation, in Bermuda, of a solvent company. That order has been terminated by Chief Insolvency and Companies Court Judge Briggs, for the reasons set out in a judgment delivered today: Carter v Bailey & Anor (Sturgeon Central Asia Balanced Fund Ltd) [2020] EWHC 123 (Ch). Judge Briggs held that recognition was available only where it concerned proceedings relating to the resolution of the debtor's insolvency or financial distress. While the current case concerned a company being wound-up (on just and equitable grounds), that company was solvent and was not in financial distress.
To quote Judge Briggs (para. [5]): "It would be contrary to the stated purpose and object of the Model Law to interpret 'foreign proceedings' to include solvent debtors and more particularly include actions that are subject to a law relating to insolvency which have the purpose of producing a return to members not creditors".
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