Hong Kong Court’s first recognition of Bahamian liquidation after landmark case Re USUM
In Re Win Business Energy Caofeidian Limited (in official liquidation) [2026] HKCFI 3951, Tanner De Witt appeared before the Honourable Madam Justice Linda Chan and successfully obtained an order for recognition and assistance in favour of joint official liquidators (from Alvarez & Marsal) appointed by the Bahamian Court (“JOLs”).
Re Win Business is the most recent recognition and assistance case applying the framework comprehensively laid down by the Companies Judge in Re USUM Investment Group Ltd [2026] HKCFI 1320. This case is also the first reported occasion where joint liquidators from the Bahamas have been recognised by the Hong Kong Court, yet further demonstrating the Court’s willingness to assist foreign officeholders. Below are the key takeaways:
1. COMI or place of incorporation
Prior to Re Global Brands Group Holding Ltd [2022] HKCFI 1789, the requirement for seeking recognition and assistance was that the foreign liquidation must be a collective insolvency proceedings commenced at the company’s place of incorporation (see for example Re Moody Technology Holdings Limited [2020] HKCFI 416. In Re Global Brands, the Court held that the starting point for recognition and assistance is where the foreign liquidation is taking place in the company’s centre of main interest (“COMI”). Nevertheless, the Court held in Re Global Brands that, where the liquidation was commenced in the company’s place of incorporation, recognition and assistance could still be granted, broadly, as a matter of practicality (see the application in Re Bull’s-Eyes Limited [2024] HKCFI 3000).
The position has developed with Re USUM which was handed down earlier this year, in that recognition and assistance may be prima facie granted where the foreign liquidation takes place in either the company’s COMI or its place of incorporation.
The Re USUM approach adopted by the Court is a positive development of the common law position in Hong Kong.
Any applicant seeking recognition and assistance will have to establish the utility/practicality of the application (oftentimes to take control of Hong Kong assets). Given this, it was arguable that the distinction drawn in Re Global Brands was not necessary (i.e. the need to show practicality in a non-COMI situation). The Re USUM approach is therefore a welcome development and it signifies (further) the Hong Kong Court’s underlying policy to assist foreign officeholders as far as possible.
This does not mean that every company should be wound up in its place of incorporation as the first port of call. Other practical considerations such as the location of assets will have to be considered. If the COMI of a foreign incorporated company is Hong Kong and assets are located in one of the 3 pilot cities in Mainland China, then winding up in Hong Kong should be seriously considered in order to engage the pilot scheme for mutual assistance, which will only be engaged if the officeholder is appointed in Hong Kong (not ‘merely’ recognised here).
Win Business was incorporated and wound up in the Bahamas. The JOLs obtained a letter of request in aid of the recognition of the JOLs in Hong Kong to take control of Hong Kong assets. Applying the Re USUM framework to the facts, the Companies Judge agreed that the application was a suitable case for the Court to grant recognition and assistance.
In addition to the above, the decision also dealt with various practical procedural matters.
2. Inter partes vs ex parte
The Companies Judge confirmed that, where there are third parties potentially affected by the application, the application for recognition and assistance should generally be brought inter partes against those entities. That being said, third parties could be excluded as a party from those proceedings by confirming their neutrality and requesting their attendance to be excused.
3. Letter of Request
Where the foreign court’s letter of request expressly confirms the officeholders’ powers under the laws of the place of liquidation, it is unnecessary for the JOLs to separately identify by evidence the provisions in the foreign laws conferring the powers sought in the application for recognition and assistance. The letter of request itself is sufficient if it adequately sets out the JOLs’ powers under foreign laws.
4. Successor officeholders
To save time and costs of potentially successive applications, the application also sought an order that the recognition and assistance granted would extend to any successor officeholders appointed by the Bahamian Court. This appears to be the first case to include such wording, which is of practical significance, especially concerning large liquidations that could last a number of years.
The Re Win Business decision again demonstrates the Court’s practical approach in granting recognition and assistance in favour of foreign officeholders. It will no doubt be an important piece of the larger Re USUM framework that will be relied upon by practitioners.
Tim Au (Partner) and Vanessa Leung (Associate) of Tanner De Witt acted for the JOLs.
Partner | Email