Illuminating the requirements for a Hong Kong SAR scheme compromising foreign debt in Re China Lumena

In Re China Lumena, Harris J considered the requirements for sanctioning a scheme of arrangement which compromises foreign law debt.

On 4 March 2020, reasons for decision were published in Re China Lumena New Materials Corp. [2020] HKCFI 338 (Re China Lumena), sanctioning a scheme of arrangement between China Lumena New Materials Corp. (the Company) and its creditors (the Scheme). In the course of his Honour’s judgment, Harris J of the High Court of Hong Kong helpfully considered the principles which apply when a proposed scheme purports to compromise debt governed by a law other than the law of Hong Kong – in this case, the law of the People’s Republic of China (the PRC).

 

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