Singapore

Introduction

Singapore is a major centre for international trade and commerce. As one of the world's most globalised and competitive economies, Singapore hosts an array of businesses, multinational corporations and financial institutions, supported by an active debt and equity capital market. Given Singapore's role in modern commerce, the current volatile global economy has led to a proliferation of insolvencies and restructurings with a Singapore nexus, including complex cross-border insolvencies that have occurred during the past eight years, such as Lehman Brothers, MF Global, OW Bunker, PT Bakrie Telecom, PT Bumi Resources, PT Berau Coal Energy, PT Berlian Laju Tanker Tbk, Pacific Andes Resources and Swiber Holdings.

As a result, and due to the increasingly complex credit and financing transactions that are being entered into, cross-border insolvency issues have featured more prominently in Singapore in recent times. This has been one of the main driving forces behind Singapore's ongoing efforts to modernise its substantive insolvency law framework. At the same time, there has been a clear shift in judicial policy towards applying universalist principles in managing cross-border insolvencies.

Cognisant of the limitations of the current statutory framework in dealing with cross-border insolvency issues, the Singapore government has broadly accepted the extensive recommendations of the Insolvency Law Review Committee (ILRC) to reform the substantive law, through the proposed introduction of an omnibus Insolvency Bill and the proposed adoption of the UNCITRAL Model Law on Cross-Border Insolvency. These efforts have been mirrored by the Singapore courts' willingness to chart new directions on recognising and assisting foreign insolvency proceedings. The Committee to Strengthen Singapore as an International Centre for Debt Restructuring was appointed to build on the work of the ILRC and, in April 2016, it released its recommendations to further strengthen Singapore's position as an international debt restructuring centre.

Present framework for cross-border insolvency

The corporate insolvency framework in Singapore includes liquidation, judicial management and schemes of arrangement. The substantive law on corporate insolvency is set out in the Companies Act (chapter 50) and the common law, with certain principles imported from the personal bankruptcy regime under the Bankruptcy Act (chapter 20).

The Singapore Companies Act was passed in 1967 and was modelled on existing UK and Australian legislation on corporations at the time.1 Accordingly, the Singapore court regularly draws from, and builds upon, insolvency case law from English, Australian and other Commonwealth jurisdictions. This remains so even though the English and Australian legislations have since undergone significant reforms, including to their provisions on cross-border insolvency.

The present Companies Act contains limited provisions dealing with cross-border insolvencies. For example, while foreign liquidators of a registered foreign company have statutory powers to administer its local assets,2 such foreign liquidators do not have all the powers and functions of a locally appointed liquidator (such as powers to examine persons on the company's property and affairs): Official Receiver of Hong Kong v Kao Wei Tseng and ors [1990].3 Further, although the Singapore court has jurisdiction to liquidate unregistered foreign companies, the court will only do so if there is a sufficient connection to Singapore or a reasonable probability that it would benefit its creditors.4

Given the vintage of the Singapore Companies Act, the current corporate insolvency regime is not sufficiently developed to deal with more complex issues arising in cross-border insolvencies. There are no provisions dealing with the relationship between Singapore liquidators and foreign liquidators. Unlike in some Commonwealth jurisdictions, there are no provisions codifying the Singapore court's jurisdiction and powers to recognise foreign insolvency proceedings, or to provide assistance to foreign courts.5 There are also no bilateral or multilateral treaties on cross-border corporate insolvency.

In the absence of legislative provisions, the Singapore court has relied on the common law to manage certain cross-border issues. For example, the common law allows the Singapore court to recognise the authority of liquidators appointed in the foreign company's place of incorporation. This gives such liquidators limited powers to administer the company's Singapore assets.6 However, judicial recognition alone has limited value without a clearer framework on how the Singapore court can assist.

One common scenario is when creditors are racing to enforce against a foreign company's Singapore assets. A foreign moratorium has no extraterritorial effect in Singapore, and the principles on when the court will grant discretionary stays to assist foreign liquidations are still relatively undeveloped. Similarly, without an international framework for cooperation, Singapore liquidators do not have a clearly defined avenue for preserving foreign assets for the benefit of creditors worldwide.

There have also been significant developments in common law jurisdictions on the question of whether local courts should adopt a territorialist or universalist approach, in insolvencies straddling multiple jurisdictions.7 At its heart, the territorialist approach is concerned with applying local assets to satisfy local creditors first, before remitting any balance for the benefit of worldwide creditors. By contrast, the universalist approach envisions one principal insolvency proceeding for the benefit of all creditors, with courts in ancillary jurisdictions assisting the principal liquidation.

In Singapore, the legislative stance is in section 377(3)(c) of the Companies Act. This provision ring-fences the local assets of an insolvent foreign company that is either registered in Singapore, or which carried on business in Singapore whilst unregistered. The provision requires Singapore liquidators of such foreign companies to satisfy its liabilities incurred in Singapore, including statutory preferential debts, before remitting the net recovery to the company's foreign liquidator.8

Section 377(3)(c), which exemplifies a territorialist approach to cross-border insolvency, has no common law counterpart. Indeed, commentators have noted that this ring-fencing provision is inconsistent with the common law doctrine of ancillary liquidation, which enables a liquidator in an ancillary liquidation to transmit locally collected assets to the foreign liquidator in the main insolvency, to create a worldwide pool of assets for pari passu distribution to all creditors.9 The precise rationale of ring-fencing is also unclear. It does not effectively protect local creditors as it applies to debts incurred in Singapore, whether by a foreign or a local creditor. Moreover, the place that debt was incurred is often incidental in modern commercial transactions. The effect of ring-fencing also gives a preference to certain creditors, at the expense of creditors worldwide.

Turning to workout regimes, although the Singapore court can facilitate schemes of arrangement for foreign companies,10 judicial management remains unavailable for foreign companies. The utility of judicial managements and schemes of arrangement is also sometimes limited, as these have no extra-territorial effect without an international treaty for cooperation. In Deutsche Bank AG v Asia Pulp & Paper Co Ltd [2003],11 a judicial manager's inability to take control of and protect foreign assets contributed to the Singapore court's decision to dismiss a judicial management application, on grounds that the purposes of judicial management could not be met.

Expected changes in upcoming Insolvency Bill

The limitations of the present framework in dealing with cross-border insolvency issues have been extensively discussed, and there is broad consensus that legislative reform is necessary to keep pace with globalisation and international developments.12

In November 2010, the Ministry of Law appointed a committee of practitioners, academics and stakeholders to, among other things, review the existing bankruptcy and corporate insolvency framework with a view to unifying the present bankruptcy and corporate insolvency statutes into a single omnibus insolvency legislation, and modernise the corporate insolvency regime. In their Final Report, released on 4 October 2013,13 the ILRC made three key recommendations pertaining to cross-border insolvency:

  • that judicial management be made available to foreign companies;
  • that the UNCITRAL Model Law on Cross-Border Insolvency (the Model Law) be adopted with appropriate modifications and exclusions; and
  • that ring-fencing provisions applicable to foreign companies be abolished, regardless of whether they are registered in Singapore.

The Singapore government broadly accepted the ILRC's recommendations in its response dated 6 May 2014, and work on the omnibus Insolvency Bill is under way. The key expected changes to the substantive law under the proposed omnibus Insolvency Bill are summarised below.

Judicial management for foreign companies

The ILRC recommended that judicial management should be made available to all foreign companies, to provide an alternative avenue for avoiding liquidation. The ILRC considered that there was no reason to deprive foreign companies with substantial business assets and activities in Singapore of the features of judicial management.

Model Law

The ILRC considered that adopting the Model Law, with appropriate modifications and exclusions, would incorporate universalism into Singapore's insolvency regime and further guide judicial policy.

The Model Law is a comprehensive framework for international cooperation in insolvency matters. It provides rules on: (i) granting foreign insolvency practitioners access to local courts; (ii) recognising foreign insolvency proceedings; (iii) coordinating relief between courts; and (iv) cooperation between courts. Its aim is to provide clear and orderly cross-border insolvency procedures, reduce procedural hurdles to recognition, and aid universalism and the uniform treatment of creditors. To date, legislation based on the Model Law has been adopted in 41 states in 43 jurisdictions, including the United Kingdom, Australia, New Zealand, Canada, the United States and Japan.14

The Model Law requires courts of enacting states to recognise foreign proceedings on production of certain basic documents. Where a foreign proceeding is recognised as a main proceeding (that is, one that takes in the debtor's centre of main interest (COMI)), a moratorium against proceedings is automatically triggered. Where the foreign proceeding is a non-main proceeding, the court has the discretion to grant a moratorium, among other relief.

The person administering the foreign insolvency proceedings is also entitled to apply directly to a court in the enacting state. Under the Model Law, a foreign representative can be granted the same powers available to locally appointed representatives - which was what the court in Official Receiver of Hong Kong15 was constrained from granting under the Companies Act. The corresponding benefit for Singapore insolvency practitioners would be in being able to seek curial assistance from enacting states, the lack of which weighed in the Singapore court's decision not to grant a judicial management order in the APP case.16

Ring-fencing to be abolished

Ring-fencing will, as a general rule, be abolished in the winding up of all foreign companies but would continue to apply to specific types of companies and industries (such as those in the financial sector). This is consistent with the Model Law, which allows enacting states to exclude the operation of its provisions to specific entities.

Statutory preferential creditors are also likely to continue having priority once the Model Law is adopted.17 In the Ministry of Law's response to feedback received on preferential creditors' interests, it expressly highlighted that the Model Law allows a court to make appropriate orders to ensure that the interests of local creditors, including preferential creditors, are adequately protected.

Singapore as a global centre for debt restructuring

On 8 May 2015, a Committee to Strengthen Singapore as an International Centre for Debt Restructuring (the Committee) was appointed by the Ministry of Law and tasked to recommend initiatives or legal reforms to enhance Singapore's effectiveness as a centre for international debt restructuring.

The Committee made 17 recommendations in its Final Report, issued on 20 April 2016,18 which have been accepted by the Ministry of Law. Some of the key recommendations are as described below.

Jurisdiction

There should be further clarity on the factors that the Singapore court will take into account to determine if it will assume jurisdiction over foreign corporate debtors who wish to restructure in Singapore. These could include factors such as whether the debtor has a head office in Singapore, whether it has opened a bank account in Singapore, and whether it has chosen Singapore law and the Singapore court as the governing law and forum for dispute resolution.

In personam worldwide effect

The Committee considered that the extraterritorial nature of a stay under Chapter 11 of the US Bankruptcy Code was particularly helpful in preventing creditor action that might frustrate a restructuring, and recommended that the Singapore court be expressly allowed to restrain creditors who are subject to the court's in personam jurisdiction from commencing legal actions globally. This would bind creditors registered in or operating from Singapore.

Recognition and enforcement of proceedings

The Committee recommended that support should be given to international efforts to increase adoption of the Model Law,19 and that the Singapore government should also explore entering into bilateral or multilateral agreements with other countries for the recognition and enforcement of restructuring proceedings.

Increased communication and co-operation between courts

To facilitate quick, efficient and certain recognition, the Committee recommended that the Singapore court explore avenues for improved communication and cooperation with foreign courts. It noted that the judiciary was already working with judges from like-minded commercial jurisdictions to take this forward, with a view to a network eventually connecting the courts of key commercial centres on a multilateral and bilateral basis.20

Specialist judges

Restructuring cases should be heard by a dedicated bench of specialist restructuring judges. Further, leading international restructuring experts could be appointed as judges to sit in the newly constituted Singapore International Commercial Court. These judges should take a proactive, judge-led approach to case management, similar to that in restructuring-centric jurisdictions such as the US bankruptcy courts in the Southern District of New York.

The Committee's recommendations are progressive, and potentially game-changing. Some of these recommendations may feature in the upcoming omnibus Insolvency Bill. If implemented, they will result in more cost-efficient and quicker restructurings with greater transparency and certainty as to outcome.

Judicial trends: towards a universalist approach

In tandem with the above developments, the Singapore court has already demonstrated an increasing willingness to recognise and assist foreign insolvency proceedings, and to tread new ground in applying universalist principles, even before the enactment of the Model Law or any reciprocal treaty to recognise and assist foreign insolvencies. This can be seen in four recent judgments by the Singapore court.

Beluga Chartering

In the landmark case of Beluga Chartering GmbH v Beluga Projects (Singapore) Pte Ltd (in liquidation) [2014],21 the Singapore liquidator of an unregistered foreign company sought to remit locally gathered assets to his counterpart liquidator in the company's place of incorporation. Among other things, Singapore's apex court had to consider the extent and applicability of the ancillary liquidation doctrine, and whether there was discretion to ring-fence the locally gathered assets of companies that did not fall under the statutory ring-fencing provisions in section 377(3)(c) of the Companies Act.

The Court of Appeal confirmed for the first time that the traditional common law doctrine of ancillary liquidation, which gives the court power to order a Singapore liquidator to remit local assets to the principal place of liquidation, has always been a part of Singapore law and stands alongside the statutory regime.

The Court of Appeal also held that the doctrine allows assets to be remitted to a foreign liquidator, even if the distribution in the foreign liquidation differs from that mandated by Singapore's statutory insolvency scheme, as long as it is not contrary to principles of justice or local public policy. The mere fact that the foreign insolvency scheme differs from the local insolvency scheme would not suffice to constitute injustice. This statement marks a departure from Re TPC Korea Co Ltd [2010],22 where the High Court (albeit in the context of schemes of arrangement) was discernibly wary of subjecting local creditors to a foreign regime that, even if fair and reasonable to a foreign court, might be viewed otherwise by the Singapore court.

After a detailed exercise in statutory interpretation, the court held that the ring-fencing provision only applied to the assets of registered foreign companies and unregistered foreign companies who nevertheless carried on business in Singapore (and thus were liable to be registered). As the unregistered company in question did not carry on business in Singapore, section 377(3)(c) did not apply. The Singapore liquidator could therefore remit the company's locally gathered assets to the principal liquidation under the ancillary liquidation doctrine.

The court resisted attempts to qualify the ancillary liquidation doctrine with territorialist restrictions, and rejected the argument that statutory ring-fencing provisions could be judicially extended over the company in question. The court took the view that it had no power to confer on a local creditor a priority that it did not otherwise have under statute, and observed (at paragraph 80) that ‘any impetus as presently exists is towards universalism rather than to favour local creditors or to confer a preference on locally incurred debts'.

The court was also urged to consider that ring-fencing provisions had fallen behind commercial and business realities. Tellingly, the court did not disagree; it simply observed that the ILRC had already recommended adoption of the Model Law, which would have furnished what the court remarked to be a clear framework for the resolution of the issue in dispute. This also suggests that once the Model Law is implemented, the Singapore court might take a ‘light-touch' approach and find little reason to interfere with the foreign representative's distribution of assets unless there is a need to protect the interests of creditors or the debtor.23

Finally, the Court of Appeal observed that foreign liquidators could also seek recognition if the foreign company was not being wound up in Singapore. If the liquidator was duly appointed, there would generally be no reason for the court to deny recognition. Although a stay of proceedings granted in the foreign liquidation had no effect in Singapore, the court had discretion to grant a wide range of reliefs to assist the foreign liquidation.24

Opti-Medix

Building on the sentiment in Beluga Chartering, the Singapore High Court advanced the case for universalist principles further in Re Opti-Medix Limited [2016].25

In Opti-Medix, the foreign companies in question were incorporated in the British Virgin Islands. Although the contracts for their business transactions were governed by Singapore law, and proceeds held in Singapore accounts, all their business was conducted in Japan. Bankruptcy orders were made against the foreign companies by the Tokyo District Court, and their Japanese bankruptcy trustee sought recognition of his appointment to administer the companies' Singapore assets.

The court observed that in cross-border insolvency, there has been a general movement away from the traditional, territorial focus on the interests of local creditors, towards recognition that universal cooperation between jurisdictions is a necessary part of modern commerce. Having one court take the lead was the most conducive way of achieving the orderly resolution of business failures across jurisdictions. Citing Beluga Chartering and the impending adoption of the Model Law, the court noted that Singapore was warming to universalist notions in its insolvency regime. There was therefore a greater readiness to go beyond traditional bases for recognising foreign insolvency proceedings.

Although the Beluga Chartering judgment had only affirmed that foreign liquidators duly appointed in the company's place of incorporation would be recognised in Singapore, the court found that this did not preclude recognition on other grounds, such as the foreign companies' COMI. The court held that it could apply a COMI test to recognise foreign liquidators, even where statute was silent. The court took the view that this was the most practical approach, as the COMI is likely to be the place where most dealings occur, most money is paid in and out, and most decisions are made.

Opti-Medix is therefore significant, as it is the first reported judgment in which the Singapore court expressly grounded its decision to recognise a foreign liquidator on the basis of the company's COMI, rather than on the traditional locus of the company's place of incorporation. This also demonstrates the Singapore court's willingness to depart from strict territorial considerations, and to consider all practical and relevant factors when recognising foreign insolvency appointments.

Hanjin Shipping

The collapse of container shipping giant Hanjin Shipping Co Ltd (Hanjin) has led to myriad claims by creditors across numerous jurisdictions against Hanjin, its subsidiaries and its fleet. In Re Taisoo Suk (as foreign representative of Hanjin Shipping Co Ltd) [2016],26 the Singapore High Court granted Hanjin's application for a temporary stay on all present proceedings and a restraint against fresh proceedings. Hanjin Shipping is the first reported decision in which the Singapore court has exercised its common law inherent jurisdiction to make orders necessary to prevent injustice or abuse of process, for the purposes of lending assistance to foreign insolvency proceedings.

Hanjin had commenced rehabilitation procedures in the Korean bankruptcy court and obtained provisional orders preserving its assets. Under the Korean regime, a rehabilitation plan would be presented to creditors. If approved, the plan would be submitted to the Korean courts for sanction. However, this process would take time, and Hanjin's vessels transiting Singapore were at risk of arrest in the meantime.

Accordingly, Hanjin applied on an ex parte basis for the Singapore court to recognise the Korean proceedings, and sought an interim stay against all proceedings and enforcement in Singapore pursuant to the court's broad, common law inherent jurisdiction. Hanjin had applied for similar orders elsewhere, and had successfully obtained recognition and relief in the UK courts; the US courts had made an interim provisional order. Such recognition was granted on the basis of the Model Law.

The Singapore court did not view the absence of an express statutory provision for assistance as an obstacle, and granted an interim stay of proceedings and enforcements pending the determination of the merits of the application. In doing so, the court was fortified by the Court of Appeal's statements in Beluga Chartering on the desirability and practicality of a universal collection of assets.

Although made in the context of winding up, the court considered that the orderly marshalling of restructurings and rehabilitations would likewise be to the ultimate benefit of all creditors. In both instances, a free-for-all situation resulting from disparate proceedings across jurisdictions would be avoided.

On the facts, the court was satisfied that Korea was Hanjin's common law COMI, which justified recognition of the Korean proceedings. The court was also satisfied that the steps taken in the Korean proceedings would be fair to foreign creditors, and that all creditors would be treated equally regardless of nationality.

In a remarkably progressive statement, the court noted that differences between the Korean and Singaporean restructuring regimes did not pose an obstacle to recognition and assistance:

The rehabilitation regime in Korea was more liberal than our scheme of arrangement or judicial management regimes under the Companies Act .... However, such differences should not be a bar to recognition and assistance of proceedings under the foreign regime. Different regimes will have differences in requirements and details: to insist on equivalence or even near-equivalence would not serve the needs of universality and orderly disposition. If anything, a more liberal foreign approach may be a spur to changes in the domestic regime.27

As previously foreshadowed in Beluga Chartering, this confirms a change in the court's disposition towards assisting regimes that might distribute assets differently from that under Singapore law. Perhaps fortuitously, the court's former wariness of different distribution regimes was also found in Re TPC Korea Co Ltd [2010],28 which the court in Hanjin Shipping declined to follow on the question of whether its inherent jurisdiction to assist was precluded by its statutory admiralty jurisdiction.

In Hanjin Shipping, the interim orders were granted pending a full inter partes hearing of the application. The outcome of this decision will be closely watched.

Pacific Andes

The cases of Beluga Chartering, Opti-Medix and Hanjin Shipping all concerned debtor companies whose COMI was not Singapore, and the focus in those cases was on how the Singapore court could assist the principal liquidation in the debtors' COMI.

By contrast, the Singapore court's recent decision in Pacific Andes Resources Development Ltd and other matters [2016]29 concerned a debtor company whose COMI was Singapore, but whose main business was conducted outside Singapore and through its foreign subsidiaries.

Pacific Andes Resources Development Ltd (PARD) was incorporated in Bermuda and listed on the Singapore Exchange. Although it had previously issued Singapore-denominated bonds, it did not carry on business in Singapore. Instead, PARD's major business of producing fishmeal and fish oil products was conducted through related companies in Peru. PARD applied for a moratorium under section 210(10) of the Companies Act to restrain creditors against commencing ‘actions or proceedings in Singapore or elsewhere', ahead of an application to present a scheme of arrangement in Singapore. At the time of PARD's application, PARD's related companies had already commenced restructuring proceedings in Peru, and Chapter 11 proceedings in the United States bankruptcy courts.

One of the issues before the Singapore court was if it had the jurisdiction, whether under section 210(10) of the Companies Act or under its inherent jurisdiction, to restrain creditors from commencing proceedings outside Singapore.

The Singapore court found that it did not. The court affirmed the orthodox position that a scheme of arrangement is territorial in nature and, likewise, so is the protective relief offered for schemes. While the court had inherent jurisdiction to restrain creditors from commencing proceedings outside Singapore in the context of a liquidation or administration, the jurisprudential basis for such orders was to protect the court's jurisdiction to do equity between claimants in an insolvent estate administered by an officer of the court. Different considerations applied for schemes of arrangement, being a debtor-in-possession regime that did not require the appointment of an officer of the court. Whether a stay of proceedings elsewhere should be granted to facilitate a Singapore scheme of arrangement was a matter for the domestic law of the foreign court, and the principles of comity and modified universalism.30

The court also rejected arguments by PARD's creditors that PARD's restructuring plan was so short on detail that it was nothing more than an attempt to manipulate the system of statutory moratoriums. The court took into account that there was a cogent and reasonable explanation for the paucity of details, as PARD's plan was heavily contingent on the restructuring plans for its Peruvian business, which in turn depended on the outcome of the Peruvian proceedings and the US Chapter 11 proceedings.31

Notably, the court remarked that this case illustrated the need for communication and cooperation between courts and insolvency administrators regarding the respective insolvency proceedings in the formulation of what was effectively a group restructuring plan, and expressed disappointment that PARD had not taken up its suggestion to formulate protocols for communication and cooperation between insolvency representatives in the respective proceedings. The court invited parties to bring its written judgment to the attention of the Bermuda court in any application to appoint provisional liquidators over PARD, and encouraged parties to enter into a protocol that permits communication between the courts.32

The Singapore court's proactive case management stance in Pacific Andes echoes the Committee's call for a new, judge-led approach in managing cross-border insolvencies. Although this approach is still in an embryonic phase, insolvency practitioners in Singapore have traditionally been quick to respond to the court's judicial guidance in this area. Accordingly, it is expected that protocols for communication and coordination (which have already been used by insolvency practitioners for Lehman Brothers and MF Global) may start gaining more currency in complex restructurings and insolvencies.

Conclusion

In a globalised world, where businesses entities within a corporate group are interconnected across borders, it is often necessary for the restructuring of an insolvent corporate group to be undertaken in a holistic manner so that value can be better preserved for all stakeholders concerned.

Taken together, the expected revisions to the corporate insolvency framework in Singapore, the impending adoption of the Model Law, and the Singapore court's increasing willingness to adopt a universalist approach to cross-border restructurings augur well for strengthening Singapore's effectiveness in dealing with issues arising out of cross-border insolvencies, and will lead to greater transparency and predictability in restructuring outcomes.

Postscript

The authors wish to highlight that, subsequent to the submission of this chapter, Parliament has since enacted several of the reforms to corporate insolvency law discussed in this chapter. These reforms to the Companies Act came into force on 23 May 2017, and include:

enhanced moratoriums for actions brought by creditors, including restraining creditor actions outside Singapore, automatic 30-day moratoriums and moratoriums that extend to related entities and holding companies;

  • new rescue financing provisions that grant super-priority to lenders assisting in a restructuring;
  • extending the judicial management regime to foreign companies;
  • abolition of the domestic ring-fencing rule in section 377 of the Companies Act; and
  • adoption of the UNCITRAL Model Law on Cross-Border Insolvency.

Notes

1 Namely, the UK Companies Act 1948 and the Australian Companies Act 1961 (Victoria).

2 See section 377(2)(b) of the Companies Act and Official Receiver of Hong Kong v Kao Wei Tseng and ors [1990] 1 SLR(R) 315.

3 1 SLR(R) 315 (Official Receiver of Hong Kong).

4 Section 351 of the Companies Act, Re Griffin Securities Corp [1999] 1 SLR (R) 219, and Re Projector SA [2009] 2 SLR(R) 151.

5 See, for example, section 426(4) of the UK Insolvency Act 1986 and sections 580-581 and 601CL of the Australian Corporations Act 2001.

6 As was done in the unreported cases of Re Cosimo Borrelli, Originating Summons No. 762 of 2010 and Re Aero Inventory (UK) Limited (in administration), Originating Summons No. 127 of 2011.

7 Including in Re HIH Casualty and General Insurance Ltd [2008]
1 WLR 852 and the UK Supreme Court decision in Rubin and anor v Eurofinance SA and ors [2012] 3 WLR 1019.

8 For an early illustration of this principle, see Tohru Motobayashi v Official Receiver [2000] 3 SLR(R) 435. For the latest decision on ring-fencing, see Beluga Chartering GmbH (in liquidation) and ors v Beluga Projects (Singapore) Pte Ltd (in liquidation) and anor (Deugro (Singapore) Pte Ltd, non-party) [2014] 2 SLR 815.

9 See Lee Eng Beng, Singapore Academy of Law Annual Review on Insolvency Law (2000) SAL Ann Rev 201, cited in RBG Resources plc (in liquidation) v Credit Lyonnais [2006] 1 SLR 240.

10 See section 210(11) of the Companies Act.

11 2 SLR 320 (APP).

12 See, for example, Lee Eng Beng, Recent Developments in Insolvency Laws and Business Rehabilitations - National and Cross-Border Issues, 2003; Paper presented at the ASEAN Law Association Workshop VI; Paper V (December 2003); Chan Sek Keong, Cross-Border Insolvency Issues Affecting Singapore (2011) 23 SAcLJ 413; Wee Meng Seng, Lessons for the Development of Singapore's International Insolvency Law (2011) 23 SAcLJ 932; and Kannan Ramesh, The Cross-Border Project - a ‘Dual-Track' Approach (2015) (paper delivered at the INSOL International Group of 36 Meeting in Singapore on 30 November 2015).

13 The Insolvency Law Review Committee, Singapore (2013), Final Report of the Insolvency Law Review Committee.

14 ‘Status: UNCITRAL Model Law on Cross-Border Insolvency (1997)' - www.uncitral.org/uncitral/en/uncitral_texts/insolvency/ 1997Model_status.html (accessed 27 September 2016).

15 Including in Re HIH Casualty and General Insurance Ltd [2008]
1 WLR 852 and the UK Supreme Court decision in Rubin and anor v Eurofinance SA and ors [2012] 3 WLR 1019.

16 ‘Status: UNCITRAL Model Law on Cross-Border Insolvency (1997)' - www.uncitral.org/uncitral/en/uncitral_texts/insolvency/ 1997Model_status.html (accessed 27 September 2016).

17 Section 377(7) of the Companies Act mandates that local preferential creditors must be paid first, before remitting any balance to foreign representatives.

18 Report of the Committee to Strengthen Singapore as an International Centre for Debt Restructuring, 20 April 2016.

19 Including potential frameworks being developed by UNCITRAL Working Group V on (i) the recognition and enforcement of insolvency related judgments, and (ii) the cross-border insolvency of multinational enterprise groups.

20 See the speech by Chief Justice Sundaresh Menon at the Opening of the Legal Year 2016, delivered on 11 January 2016 at paragraphs [22]-[25].

21 2 SLR(R) 815 (Beluga Chartering).

22 2 SLR 617 at [16].

23 See Articles 21(2) and 22 of the Model Law, which provide that the courts of the recognising state may entrust the distribution of the debtor's local assets to the foreign representative, with such conditions it considers appropriate to adequately protect the interests of creditors or the debtor.

24 See Beluga Chartering at [99], in which the Singapore Court of Appeal stated that: ‘Most courts recognise the desirability and practicality of a universal collection and distribution of assets and that a creditor should not be able to gain an unfair priority by an attachment or execution on assets located within the jurisdiction of the court subsequent to a winding-up order made elsewhere... Whether and how the Singapore court will render assistance to foreign winding-up proceedings... will depend on the particular circumstances before it.'

25 4 SLR 312 (Opti-Medix).

26 SGHC 195 (Hanjin Shipping).

27 See Hanjin Shipping at [27].

28 2 SLR 617.

29 SGHC 210 (Pacific Andes).

30 See Pacific Andes at [20].

31 See Pacific Andes at [73], in which the court stated: ‘the approach that I have taken to the construction of s 210(10) is not only justified as a matter of principle but warranted in present-day circumstances where cross-border restructurings are increasingly becoming common, given the proliferation of cross-border investments and trade. Where businesses entities are interconnected and cross-border in nature, it is only to be expected that restructuring of such business entities is undertaken on a composite, interconnected and inter-related basis. The formulation of such a composite plan is a long, involved and complicated exercise simply by reason of the involvement of multiple jurisdictions with different restructuring regimes and the interweaving of multifarious business and creditor interests. The individual plans for the units that collectively make up the composite plan will therefore take time to formulate and finesse. The courts must recognise and not turn a blind eye to this reality.'

32 See Pacific Andes at [76]-[79].

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