The very first case that the Hong Kong Court recognised and granted assistance to bankruptcy administrators appointed by the Mainland Chinese courts in insolvency proceedings commenced in Mainland China was Re CEFC Shanghai International Group Limited [2020] HKCFI 167. Following the latest developments in the insolvency and restructuring regime, the Hong Kong Court has made further strides towards the enhanced cross-border restructuring cooperation in Re HNA Group Co Limited [2021] HKCFI 2897, in which the Honourable Mr. Justice Harris recognised Mainland Chinese reorganisation proceedings for the very first time (the “Decision”).
Background
HNA Group Co Limited (the “Company”), a company incorporated in Hainan, China, is the holding company of the HNA Group, a Chinese conglomerate with a portfolio spanning sectors including aviation, real estate, tourism, and financial services. Although it was one of the most active investment groups of the world at one point, the group was brought to its knees in 2021 when it declared bankruptcy pursuant to failed debt restructuring efforts. An application was made by the Bank of Hainan Company Limited to the Hainan Province Higher People’s Court (the “Hainan Court”) seeking bankruptcy reorganisation of the Company on insolvency grounds.
Pursuant to the Enterprise Bankruptcy Law and the Provisions of the Supreme People’s Court, an Order for reorganisation was made by the Hainan Court on 10 February 2021 (the “Hainan Reorganisation”). Administrators, including Beijing-based lawyers and an officer of the Hainan Province Legal Administrative Office, were appointed to comprise the Administrator. The same Order provided that certain members of the Company’s group may continue to manage its assets and business affairs, subject to the powers of the Administrator.
An application was made by the Administrator to the Hainan Court for a letter of request to be made to the Hong Kong Companies Court seeking the recognition of the Hainan Reorganisation, to assist the Administrator in Hong Kong.
The Hong Kong Court’s Decision
Harris J reiterated that recognition will be granted when:
- The foreign insolvency proceedings are collective insolvency proceedings; and
- The foreign insolvency proceedings are opened in the company’s country of incorporation.
These are well-established requirements laid down in several previous cases: Re Joint Liquidators of Supreme Tycoon Ltd [2018] HKCFI 277; Re Joint Provisional Liquidators of China Lumena New Materials Corp [2018] HKCFI 276.
The Hainan Reorganisation was granted pursuant to Chapter 8 of the Enterprise Bankruptcy Law, which allows debtors or creditors to apply to the Mainland Court for recognition of a formal reorganisation process. The objective is to “restructure debt and rehabilitate a company’s business and avoid liquidation”. As the Hainan Reorganisation concerns all the Company’s creditors, Harris J found it to be collective insolvency procedure upon a proper construction.
As the Hainan Reorganisation was ordered by the Hainan Court in respect of the Company which was incorporated in Hainan, the second criteria was clearly satisfied.
The Hainan Reorganisation was therefore recognised by the Hong Kong Companies Court.
The terms of the Order sought were conventional and are appended to the Decision.
The Role of the Cooperation Agreement
As discussed in our previous article, the Mainland and Hong Kong entered into a new cooperation mechanism on 14 May 2021 in the form of the Record of Meeting of the Supreme People’s Court and the Government of the Hong Kong Special Administrative Region and Mutual Recognition of and Assistance to Bankruptcy (Insolvency) Proceedings between the Court of the Mainland and the Hong Kong Special Administrative Region and the Supreme People’s Court’s Opinion on taking forward a pilot measure in relation to Recognition and Assistance to Bankruptcy (Insolvency) Proceedings in the Hong Kong Special Administrative Region (the “Cooperation Agreement”). Pursuant to the Cooperation Agreement, Shanghai, Shenzhen, and Xiamen agreed to terms with Hong Kong where the cities would mutually recognise and assist each other in cross-border insolvency matters.
As Hainan is not party to the Cooperation Agreement, the Cooperation Agreement mechanism does not come into play. However, reaffirming his decision in Re CEFC, Harris J decided that reciprocity is not a requirement for common law recognition and assistance in Hong Kong. The possibility that the Hainan Court may not recognise Hong Kong insolvency proceedings and officeholders does not itself prevent the Hong Kong Court from granting recognition of the Hainan Reorganisation at the Hainan Court’s request.
Conclusion
The Decision is the latest welcome addition to a line of encouraging recent developments in the insolvency sphere. The fact that the Hainan Reorganisation was recognised notwithstanding the fact that Hainan is not amongst the parties of the Cooperation Agreement demonstrates the Hong Kong Companies Court’s pragmatism and flexibility.
From Re CEFC, to the Cooperation Agreement, to the Decision, the Hong Kong regime has consistently strived towards fostering an enhanced cross-border insolvency cooperation regime.
香港法院首次认可中国内地的重整程序
香港法院首次认可并协助在内地启动并由内地法院指定破产管理人的破产程序案件是Re CEFC Shanghai International Group Limited [2020] HKCFI 167。随着破产重整制度的最新发展，香港法院在 Re HNA Group Co Limited [2021] HKCFI 2897案件中进一步加强跨境重整合作，夏利士法官亦首次认可内地的重整程序 (“裁决”)。
背景
在中国海南注册成立的海航集团有限公司 (“公司”) 是海航集团的控股公司。作为一家业务多元化的国内企业集团，海航集团投资组合涵盖航空、房地产、旅游和金融服务等领域。尽管它曾一度是世界上最活跃的投资集团之一，该集团在 2021 年因债务重整失败而宣布破产，陷入了危机。海南银行以公司资不抵债为由向海南省高级人民法院 (“海南法院”) 申请了破产重整。
根据《企业破产法》及最高人民法院的规定，海南法院于2021年2月10日颁发了重整命令 (“海南命令”)。管理人员，包括北京律师和海南省法制办公室的一名官员，被任命为清算管理人。同一命令规定公司集团的某些成员可以在管理人的监视权力下继续管理其资产和业务。
管理人向海南法院提出申请，请求香港公司法庭认可海南命令，协助管理人在香港行使其权力。
香港法院的裁决
夏利士法官重申，法院会在以下情况下同意认可：
- 该境外清盘程序是一项集体清盘程序; 和
- 该境外清盘程序是在公司的注册地启动的。
这些要求是在之前的几个案例中所制定的：Re Joint Liquidators of Supreme Tycoon Ltd [2018] HKCFI 277; Re Joint Provisional Liquidators of China Lumena New Materials Corp [2018] HKCFI 276.
海南命令是根据《企业破产法》第八章的规定允许债务人或债权人向内地法院申请认可企业的正式债务重整程序。目标是 “重组债务并恢复公司业务和避免清算”。由于海南命令涉及到公司所有的债权人，夏利士法官认为这事实上已构成了一个集体清盘程序。
由于海南命令是海南法院就在公司注册地海南颁发的，第二项要求也显然被满足。
海南命令因此获得香港公司法庭的认可。所寻求的是常规的命令条款，并附加在裁决之后。
合作协议的作用
正如我们之前的文章所述，内地与香港于2021年5月14日以最高人民法院与香港特别行政区政府关于内地与香港特别行政区法院相互认可和协助破产程序的会谈纪要的形式，建立了新的合作机制 (“合作协议”) 。根据合作协议，上海、深圳和厦门同意与香港就跨境清盘和破产事宜相互认可和协助。
由于海南并不是合作协议的缔约方，因此合作协议机制并未发挥作用。然而，夏利士法官重申了他在 Re CEFC 一案中的裁决，认为互惠并不是在香港法院在普通法下认可和协助境外程序的必要条件。海南法院有可能不承认香港破产或清盘程序和公职人员的可能性本身并不妨碍香港法院应海南法院的要求认可海南命令。
总结
裁决是近期破产清盘领域一系列进展的最新和令人鼓舞的发展。尽管海南并非合作协议的缔约方，但海南命令获得认可的事实表明了香港公司法庭的务实性和灵活性。从 Re CEFC 到合作协议，再到该裁决，香港的制度一直致力于促进加强跨境破产合作的机制。
陈琬琳，合伙人
黄殷怀，律师
