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Forged in the fires of the Asian financial crisis, Indonesia’s bankruptcy law has some surprising idiosyncrasies and encourages a restructuring culture defined by pragmatism and flexibility. In other words, it doesn’t look like any other bankruptcy law in the world.
Indonesia’s bankruptcy law provides remarkable latitude for workouts, so long as they can get creditor support – but the efforts to reach those compromises can see both sharp practices and consensual negotiation.
Indonesia has a reputation for casual corruption, allied with a court system riddled with inefficiencies both innocent and malign. That has scared off a lot of non-Indonesians from entering the country – but it isn’t difficult for practitioners, especially on the corporate side, to build a successful practice with clean hands.
To be successful in Indonesia, relationships are everything. GRR presents a guide to the firms and individuals it’s essential to know in Indonesia’s restructuring market.
GRR presents the latest in our Worked Out series, this time profiling China and Hong Kong. With headwinds including an extraordinary non-performing loan load, slowing growth, political tensions locally, and a trade war with the US, restructuring professionals in China and Hong Kong are getting ready for what’s around the corner.
The past five years have seen a shift in Chinese restructuring practice with the concept of reorganisation increasingly being seen as a business tool, rather than an admission of failure. But practitioners say there’s still a way to go, pointing out that creditors’ rights need to be strengthened, and personal bankruptcy remains entirely uncatered for.
In China, more so than in other jurisdictions, it’s impossible to avoid the government for a restructuring of any significance – particularly municipal and local government. That’s not going to alter any time soon, but government attitudes towards company failure and restructuring are changing.
Despite the growing power of the Chinese economy, its prodigious load of non-performing loans is posing both challenges and opportunities for local restructuring practitioners.
As a trade war with the US puts a squeeze on many Chinese industries, the government is pursuing a US$1 trillion-plus global investment project set to dramatically expand its cross-border engagement. Is this a perfect storm for the cross-border restructuring market?
Part of our "China and Hong Kong Worked Out" series: Hong Kong’s restructuring practitioners are, by necessity, creative. Without a restructuring and insolvency regime beyond the scheme of arrangement inherited from the British, practitioners have a “make-do-and-mend” approach aided by a supple judiciary and a can-do attitude among professionals.
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