RE KONG WAH HOLDINGS LTD (In Compulsory Liquidation)

RE KONG WAH HOLDINGS LTD (In Compulsory Liquidation)

The court will approve a consensual cross-border protocol where it does not conflict with comity or domestic statutory distribution schemes, ensures equality of creditor treatment and economical administration; given the same liquidators in both jurisdictions, Bermudian primary liquidation and prior Bermudian court approval, the Hong Kong Court authorised and approved the protocol under its supervisory discretion.

Citation
RE KONG WAH HOLDINGS LTD (In Compulsory Liquidation)
Parties
Company (in Compulsory Liquidation): Kong Wah Holdings Limited (In Compulsory Liquidation); Company (in Compulsory Liquidation): Akai Holdings Limited (In Compulsory Liquidation); Respondent: Official Receiver
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
6 February 2004
Case Number
HCCW49/2000
Procedural Posture
Companies (winding Up) / Summons Under S.200(3) Companies Ordinance for Directions and Approval of Cross Border Protocol (interlocutory)
Outcome
Summons granted; protocol approved and liquidators authorised to enter into and implement the cross-border protocol
Legal Topics
Liquidation Protocols, Comity, Recognition and Coordination of Concurrent Liquidations, Court Directions Under S.200(3)
Source Language
EN
Insolvency Company Law Cross Border Insolvency Civil Procedure Liquidation Protocols Comity Recognition and Coordination of Concurrent Liquidations Court Directions Under S.200(3)

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Parties

Kong Wah Holdings Limited (In Compulsory Liquidation)

Company (in Compulsory Liquidation)

Akai Holdings Limited (In Compulsory Liquidation)

Company (in Compulsory Liquidation)

Official Receiver

Respondent

Procedural Posture

Companies (winding Up) / Summons Under S.200(3) Companies Ordinance for Directions and Approval of Cross Border Protocol (interlocutory)

Legal Issues

  1. 1 Whether the Hong Kong Court should approve and authorise liquidators to implement a cross-border protocol coordinating concurrent Hong Kong and Bermudian liquidations
  2. 2 Whether the protocol offends principles of comity or dis-applies Hong Kong statutory distribution scheme
  3. 3 Whether the protocol treats creditors equally and is in creditors' best interests

Ratio Decidendi

The court will approve a consensual cross-border protocol where it does not conflict with comity or domestic statutory distribution schemes, ensures equality of creditor treatment and economical administration; given the same liquidators in both jurisdictions, Bermudian primary liquidation and prior Bermudian court approval, the Hong Kong Court authorised and approved the protocol under its supervisory discretion.

Court Disposition

Summons granted; protocol approved and liquidators authorised to enter into and implement the cross-border protocol

Orders

  • Liquidators authorised and empowered to enter into and implement the cross-border protocol between the Hong Kong and Bermudian liquidations as per the draft orders submitted to the Court
  • The protocol is approved by the Court and the reliefs sought in the summons are granted as per the draft orders submitted