On 14 May 2021, China’s Supreme People’s Court (SPC) issued the “Record of Meeting on Mutual Recognition of and Assistance to Bankruptcy Proceedings between the Courts of the Mainland and of the Hong Kong Special Administrative Region” (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) (the “Record of Meeting”) and the “Opinions of the Supreme People's Court on Carrying out the Pilot Program for Recognizing and Assisting the Hong Kong Special Administrative Region in Bankruptcy Proceedings” (最高人民法院关于开展认可和协助香港特别行政区破产程序试点工作的意见) (the “Opinions”), establishing the mechanism for the Mainland and Hong Kong to seek mutual recognition and assistance in bankruptcy proceedings.
The mechanism for mutual recognition of and assistance to bankruptcy proceedings between the Mainland and Hong Kong applies to collective debt liquidation proceedings with similarities between the two jurisdictions. Specifically, bankruptcy proceedings in the Mainland include bankruptcy liquidation, bankruptcy reorganization, and bankruptcy conciliation procedures; bankruptcy proceedings in Hong Kong include compulsory winding up of a Hong Kong company, voluntary winding up of a company's creditors, and debt restructuring procedures that are undertaken in winding up as approved by a Hong Kong court pursuant to Section 673 of the Companies Ordinance of the Hong Kong Special Administrative Region (HKSAR).
According to the Record of Meeting and the Opinions, the SPC has appointed several intermediate people's courts in pilot areas to carry out mutual recognition of and assistance to bankruptcy proceedings with the courts of HKSAR in accordance with the law. The pilot areas in the Mainland include Shanghai Municipality, Xiamen City, Fujian Province, and Shenzhen City, Guangdong Province.
Cover Photo by Melinda Gimpel (https://unsplash.com/@melindagimpel) on Unsplash
Contributors: CJO Staff Contributors Team
