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Jersey Corporate Cross Border Insolvent Reconstruction and Moratorium Procedures

February 2010 - Corporate & Commercial. Legal Developments by Bedell Cristin.

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The liquidity crisis has increased the need for creative procedures to avoid sudden death bankruptcy in order to salvage existing value.

A Jersey company or a company incorporated elsewhere but administered in Jersey may become involved in insolvency procedures under Jersey law or the law of a jurisdiction outside Jersey.

Both a désastre and a creditors' winding up result in the closure of the business and realisation of all assets, by the Viscount in the case of a désastre, or a liquidator in the case of a winding up. A désastre can be sought by the company as debtor or by a creditor. A creditors' winding up can be initiated by two-thirds or more of a Jersey company's shareholders (but not by creditors or by the board) or by the court.

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