Zlomrex International Finance SA [2013] EWHC 3866 (Ch) (26 November 2013)

Zlomrex International Finance SA [2013] EWHC 3866 (Ch) (26 November 2013)

The English court has jurisdiction to convene a creditors' meeting for the scheme of arrangement because the company has established a sufficient connection with England by moving its COMI and business operations to London, and the class of creditors is properly constituted. The scheme can proceed despite the company being French-registered, and issues of foreign recognition can be addressed at the sanction stage.

Citation
[2013] EWHC 3866 (Ch)
Parties
Applicant Company: Zlomrex International Finance S.A.
Jurisdiction
England and Wales
Judgment Date
26 November 2013
Procedural Posture
Scheme of Arrangement Under Companies Act 2006 / Application to Convene Creditors' Meeting
Outcome
Application granted to convene a meeting of the beneficial owners of the Notes, subject to amendment or removal of the provision purporting to 'approve' scheme documents.
Legal Topics
Scheme of Arrangement, Jurisdiction, Centre of Main Interests (comi), Recognition of Foreign Schemes, Creditors' Meetings
Insolvency Law Company Law Cross Border Insolvency Scheme of Arrangement Jurisdiction Centre of Main Interests (comi) Recognition of Foreign Schemes Creditors' Meetings

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Parties

Zlomrex International Finance S.A.

Applicant Company

Procedural Posture

Scheme of Arrangement Under Companies Act 2006 / Application to Convene Creditors' Meeting

Legal Issues

  1. 1 Whether the English court has jurisdiction to convene a creditors' meeting for a scheme of arrangement involving a French-registered company with recent relocation of COMI to England.
  2. 2 Whether the class of creditors is properly constituted for the scheme.
  3. 3 Whether the scheme documentation and process are appropriate for convening the meeting.

Ratio Decidendi

The English court has jurisdiction to convene a creditors' meeting for the scheme of arrangement because the company has established a sufficient connection with England by moving its COMI and business operations to London, and the class of creditors is properly constituted. The scheme can proceed despite the company being French-registered, and issues of foreign recognition can be addressed at the sanction stage.

Court Disposition

Application granted to convene a meeting of the beneficial owners of the Notes, subject to amendment or removal of the provision purporting to 'approve' scheme documents.

Orders

  • Meeting of beneficial owners of the Notes to be convened to consider the proposed scheme of arrangement.
  • Provision in draft order purporting to 'approve' scheme documents to be amended or removed; identification of documents permitted but not approval.