Having asked your input for India and Brazil, this week your comment is sought for Australia. Your input (cases, literature, views) will contribute to the draft text for the 5th edition of Wessels International Insolvency Law Part I. Many thanks for the improvement of the text of my forthcoming book. As noted earlier, providing input is based on the idea of a writing process, a ‘deliberate public participatory drafting process’, see my blog at https://bobwessels.nl/blog/2021-12-doc1-book-on-international-insolvency-law-your-input-needed/. This third blog focuses on (legislative) developments in some 30 countries (outside of the EU, obviously these draft texts are rather short), in the blog at hand: Australia. I also look forward to comments on the draft text below, preferably soon, but on 15 January 2022 at the latest via: info@bobwessels.nl. The second half of January 2022 I hope to finalize the manuscript and send it to Wolters Kluwer’s editorial office. Below is the draft text:
[10360] Australia. In Australia the general attitude to different kinds of cross-border assistance measures always has been favourable (see Omar (2002a), 367ff). In June 2002 the Federal Government announced the next phase in its Corporate Law Economic Forum Program (CLERP), a review of cross-border insolvency law, including the possible enactment of the Model Law. The review is called CLERP 8. The Government published a paper in August 2003, called ‘Cross-Border Insolvency. Promoting international cooperation and coordination.’ In essence it is proposed that the Model Law will be adopted as written. For the text of the paper, see www.treasury.gov.au. For comments and discussion see Mason (2003); Anderson (2004); Emmett (2005). For a hypothetical case demonstrating the Model Law in Australia, see Harris (2005). Since 1 July 2008 the Cross-Border Insolvency Bill 2008 entered into force. For an overview, see Mason (2008), Nicols/Wong (2008); Trichard (2008); Maiden (2010); Atkins and Mason, in: Ho (ed.) (2012), 15ff. and McCarthy/Welch (2013). For a comparative analysis of the enactments in Australia, Canada, New Zealand, UK and USA, see Hannan (2015). See also publications of (now former) Chief Justice Hon Spigelman, who has been a strong promotor of the need for cross-border judicial cooperation, see e.g. Spigelman (2009); Spigelman (2010).
Cases. One of the first cases is the recognition of a foreign proceeding of Korea (Hur v Samsun Logix Corporation [2009] FCA 372]; IILR 2010, 51. See para. 10328a, where I made some comments to Ackers v Saad Investment Co Ltd. [2010] FCA 1221 (22 October 2010). See regarding Japan Airlines Corporation: Meehan (2010) and In Re Ackers v Saad Investment Co Ltd.: Powers (2011). Regarding these two cases and including Australian matters regarding Lehman Brothers, see Mason/Atkins/Maiden (2011). In Ackers, the full Federal Court of Australia dismissed the appeal, see Atkins/McCoy, ICR 2014, 304ff. The Federal Court decision of Crumpler (as liquidator and joint representative) of Global Tradewaves Ltd (a company registered in the British Virgin Islands) v Global Tradewaves (in liquidation), in the matter of Global Tradewaves Ltd (in liquidation) [2013] FCA 1127 provides an illustrative example of the way that cross border insolvency recognition can be used to aid a foreign administration. See http://www.austlii.edu.au/au/cases/cth/FCA/2013/1127.htlm.
For an overview, see Atkins, in: Ho (ed.) (2016), 17ff.; O’Brien and Sackar, in: Corporate Restructuring and Insolvency in Asia 2020, 58ff.; Prestwich et al., MüKoInsO (2021), 580ff. More recently The Federal Court’s recognition has been provided to Thai Airways, as foreign main proceedings, both for the Thai law reorganisation proceeding (International Public Company Limited (No 2) [2020] FCA 1509), as well as its reorganisation plan (Didyasarin v Thai Airways International Public Company Limited (No 3) [2021] FCA 1092), to a German insolvency practitioner recognising his appointment over Greensill Bank AG (Frege in his Capacity as Foreign Representative of Greensill Bank AG v Greensill Bank AG [2021] FCA 330; Frege in his Capacity as Foreign Representative of Greensill Bank AG v Greensill Bank AG (No 2) [2021] FCA 510) and to an Italian concordato preventivo proceedings for an Italian shipping company (In the matter of Michele Bottiglieri Armatore SpA [2021] FCA 795).
Hydrodec. See also in Re Hydrodec Group Plc [2021] NSWSC 755, in which the Supreme Court of New South Wales rejected an application by a non-operating holding company, Hydrodec Group Plc, for recognition of its UK debtor-in-possession Part A1 moratorium process, included in the UK Insolvency Act since July 2020. The NSW Supreme Court found, amongst others, (a) that COMI of the company was not in the UK, and therefore refused to recognise the Part A1 Moratorium as a foreign main proceeding for the purposes of the Australian version of the Model Law (the Cross-Border Insolvency Act 2008 (Cth), (b) that there could be no presumption that the COMI of the company was at its registered office in the UK (see Article 16(3) of the Model Law) when this company also has a second registered office as a foreign company in Australia, and (c) that in a debtor-in-possession proceeding such as the UK’s Part A1 Moratorium the joint monitors appointed were the “foreign representatives” in stead of the company itself or one of its directors or officers. See for comments Roberts and Williams, CRI 2021, 115ff.
Practice Note. In 2020, most notable, the Federal Court of Australia issued a Cross-Border Insolvency Practice Note: Cooperation with Foreign Courts or Foreign Representatives (GPN-XBDR) (https://www.fedcourt.gov.au/law-and-practice/practice-documents/practice-notes/gpn-xbdr). In general, the appoach is that cooperation between the court and a foreign court or foreign representative under Article 25 MLCBI will generally occur under a co-ordination agreement that has previously been approved by the Court, and is known to the parties, in the particular proceeding. Ordinarily it will be the parties who will draft the co-ordination agreement. The Note states that in doing so, the parties should be guided by the JIN Guidelines [see par. 10425n-058], and the Modalities of Court-to-Court Communication (‘the Modalities’) both published by the Judicial Insolvency Network [par. 10425n-055] and UNCITRAL Practice Guide. It then recommends that other useful international guidance as to cross-border insolvency can be found at the Global Principles, the Global Guidelines and the Global Rules as published by the ALI and III (see par. 10245n-015), a source developed by the late professor Ian Fletcher and me in 2012.