RE THE JOINT PROVISIONAL LIQUIDATORS OF CHINA LUMENA NEW MATERIALS CORP (IN PROVISIONAL LIQUIDATION)

RE THE JOINT PROVISIONAL LIQUIDATORS OF CHINA LUMENA NEW MATERIALS CORP (IN PROVISIONAL LIQUIDATION)

Foreign insolvency officeholders may obtain bank account information in Hong Kong without a prior Hong Kong recognition order if the company's directors could obtain the same information, but they must obtain a Hong Kong recognition order before taking possession of or otherwise dealing with assets located in Hong Kong, including transferring bank balances.

Citation
[2018] HKCFI 276
Parties
Applicants: Man Chu So; Yat Kit Jong; Simon Conway (Joint Provisional Liquidators); Company: China Lumena New Materials Corp
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
7 February 2018
Case Number
HCMP494/2017
Procedural Posture
Application for Recognition and Assistance / Recognition Application (order Granted)
Outcome
Application for recognition granted; court clarified distinction that documents may be obtained without prior Hong Kong recognition but transfers/dealing with Hong Kong assets require a Hong Kong recognition/order.
Legal Topics
Recognition of Foreign Liquidators, Access to Bank Information, Transfer of Assets, UNCITRAL Model Law
Source Language
EN
Cross Border Insolvency Company Law Civil Procedure Banking Law Recognition of Foreign Liquidators Access to Bank Information Transfer of Assets UNCITRAL Model Law

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Parties

Man Chu So; Yat Kit Jong; Simon Conway (Joint Provisional Liquidators)

Applicants

China Lumena New Materials Corp

Company

Procedural Posture

Application for Recognition and Assistance / Recognition Application (order Granted)

Legal Issues

  1. 1 Whether foreign insolvency officeholders appointed in the place of incorporation require a Hong Kong court order to obtain bank account documents located in Hong Kong
  2. 2 Whether foreign insolvency officeholders require a Hong Kong court order to transfer or otherwise deal with assets (credit balances) located in Hong Kong
  3. 3 Proper balance between convenience for foreign officeholders and court supervision of dealing with assets

Ratio Decidendi

Foreign insolvency officeholders may obtain bank account information in Hong Kong without a prior Hong Kong recognition order if the company's directors could obtain the same information, but they must obtain a Hong Kong recognition order before taking possession of or otherwise dealing with assets located in Hong Kong, including transferring bank balances.

Court Disposition

Application for recognition granted; court clarified distinction that documents may be obtained without prior Hong Kong recognition but transfers/dealing with Hong Kong assets require a Hong Kong recognition/order.

Orders

  • Order recognising Man Chu So, Yat Kit Jong and Simon Conway as the joint provisional liquidators of China Lumena New Materials Corp (in provisional liquidation)
  • Clarification that while banks may provide account documents to foreign insolvency officeholders without a prior Hong Kong recognition order, a Hong Kong court order is appropriate before transferring or otherwise dealing with the company's funds located in Hong Kong