On 6 May 2022, the Honorable Madam Justice Linda Chan granted a petition for the winding-up (in Hong Kong) of Up Energy Development Group Limited, which was incorporated in Bermuda.
Her Ladyship held, among other things, that if a foreign company is not ordered to be wound up in Hong Kong, the Hong Kong court does not have power under the common law to confer any powers on the company’s liquidator appointed in another jurisdiction, or make any provisions under the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32) available to the company.
In a line of authorities in Hong Kong, including cases such as Joint Official Liquidators of A Company v B  4 HKLRD 374, the court has granted recognition and assistance to foreign insolvency proceedings and officeholders, such that:
- It has become usual for a foreign insolvency officeholder to obtain an order of the Hong Kong court giving recognition and assistance in standard terms, by means of an ex parte application.
- The Hong Kong court has granted further, specific assistance to foreign insolvency officeholders on certain occasions – for instance, by making an order for the production of documents.
- Specifically with regard to bankruptcy administrators appointed in Mainland China seeking recognition and assistance in Hong Kong, the above practice has been formalized in a framework – now often referred to as the Cooperation Mechanism – agreed between the two jurisdictions on 14 May 2021.
Given this latest decision ( HKCFI 1329), a foreign insolvency officeholder intending to seek recognition and assistance in Hong Kong should be prepared to make submissions to satisfy the court that it has the power to grant the relief sought.
Continue reading here.