Key takeaway
A foreign registered company in Australia may become subject to competing insolvency processes when creditors initiate a winding up in Australia as well as insolvency proceedings in the company’s place of incorporation. This can raise complex issues of comity, recognition, assistance, the authority of the company’s directors to contest the relevant insolvency filings and prejudice to creditors, requiring careful balancing of competing interests and obligations.
Even without an application for recognition and assistance under the UNCITRAL Model Law on Cross-Border Insolvency (Model Law), section 581 of the Corporations Act 2001 (Cth) (Act) provides a flexible pathway for court-to-court cooperation, including…