There are two approaches to acceleration following the filing of bankruptcy. On the one hand, a typical US style debt document provides for automatic acceleration on an insolvency event of default. On the other hand, many other jurisdictions typically do not include such automatic acceleration provisions in financing documents. This article discusses the primary differences between the Chapter 11 treatment of a loan that automatically accelerates the debt following an insolvency and a loan in which such acceleration is at the discretion of the lender.
6 FEB 2025In this article the authors consider two recent decisions that illustrate how a US bankruptcy court and the English Court of Appeal (applying the EUIR to a pre-Brexit case) can analyse COMI in different ways. The decisions have implications for groups that need to restructure cross-border financing arrangements – particularly where financing has been raised by a “letterbox” company (SPV). Such companies may face greater challenges establishing that their COMI is in their jurisdiction of incorporation before a US bankruptcy court than they would in Europe.
1 MAR 2023This article examines the legal and commercial rationale behind the adoption of parallel restructuring processes, focusing on recent precedents in England and Hong Kong. It then considers criticisms of parallel proceedings, and whether and when alternative mechanisms may achieve comparable results.
1 OCT 2023