High Court of Justice London: Widerlegung der Vermutung des COMI am Ort des satzungsmäßigen Sitzes nur durch objektive, für Dritte feststellbare Elemente („Stanford“)

24.09.2009

EuInsVO Art. 3 Abs. 1

Widerlegung der Vermutung des COMI am Ort des satzungsmäßigen Sitzes nur durch objektive, für Dritte feststellbare Elemente („Stanford“)

High Court of Justice London, Urt. v. 3. 7. 2009 – [2009] EWHC 1441 (Ch) Case Nos. 13338 and 13959 of 2009

Leitsätze der Einsenderin:

1. Die Vermutung des Art. 3 Abs. 1 Satz 2 EuInsVO, dass der Mittelpunkt der hauptsächlichen Interessen der Ort des satzungsmäßigen Sitzes ist, kann nur durch objektive und für Dritte feststellbare Elemente widerlegt werden.

2. Für Dritte feststellbar ist, was allgemein zugänglich ist und was Dritte im Rahmen des gewöhnlichen Geschäftsverkehrs mit der Gesellschaft erfahren würden.

Introduction

[1]  This application is part of the fall-out of the collapse of Sir Allen Stanford's business empire. Underlying the collapse is the allegation that for some considerable time Sir Allen and his associates have been engaged in a giant and fraudulent Ponzi scheme as a result of which many investors, world-wide, have been defrauded. Sir Allen denies these allegations. On 16 February 2009 the United States Securities Exchange Commission („SEC“) filed a complaint against Sir Allen, James M. Davis, Laura Pendergest-Holt, Stanford International Bank Ltd („SIB“), Stanford Group Company, and Stanford Capital Management, LLC, alleging, among other causes of action, securities fraud and violations of the securities laws. On the same day the United States District Court for the Northern District of Texas made an order appointing Mr Ralph Janvey („the Receiver“) as receiver over the assets worldwide of SIB; Stanford Group Company; Stanford Capital Management, LLC; Sir Allen; James M. Davis and Laura Pendergest-Holt; and all entities owned or controlled by any of them, including Stanford Trust Company Ltd („STCL“). SIB is a company incorporated in Antigua and Barbuda and has its registered office there. In parallel with the actions taken in the USA by the SEC the Antiguan regulatory authorities were also taking action against SIB. On 19 February 2009 the Financial Services Regulatory Commission of Antigua and Barbuda („FSRC“) appointed Mr Wastell and Mr Hamilton-Smith as receivers-managers („Receiver-Managers“) of SIB and STCL. A week later, on 26 February 2009 the Antiguan court made an order appointing Mr Wastell and Mr Hamilton-Smith as Antiguan receivers for SIB and STCL. On 24 March 2009 the FSRC presented a petition against SIB under the International Business Corporations Act of Antigua and Barbuda, seeking the winding up of SIB and the appointment of Mr Wastell and Mr Hamilton-Smith as liquidators. On 15 April 2009 the Antiguan court made a winding up order on the FSRC's petition and appointed Mr Hamilton-Smith and Mr Wastell as liquidators of SIB („the Liquidators“).

[2]  Both the Receiver and the Liquidators apply for recognition under the Cross Border Insolvency Regulations 2006. Each of them alleges that the proceedings in which they have been respectively appointed are „main proceedings“ for the purposes of the 2006 Regulations. The apparent lack of co-operation between them has resulted in an expensive application at the creditors' expense.

<zwtitel></zwtitel>The Cross Border Insolvency Regulations 2006</zwtitel><//zwtitel>

[4]  The 2006 Regulations give effect to the UNCITRAL Model Law within Great Britain in the form set out in Schedule 1 to the 2006 Regulations. The law applies where assistance is sought in Great Britain by a foreign representative in connection with a foreign proceeding: Art 1 No 1 (a). Both the expressions „foreign proceeding“ and „foreign representative“ are defined expressions. A „foreign proceeding“ may be either a „foreign main proceeding“ or a „foreign non-main proceeding“. These two expressions are likewise defined. A foreign proceeding is a foreign main proceeding if it takes place in a state where the debtor has the „centre of its main interests“ („COMI“). This expression is not defined, although there is a presumption that a company's registered office is its COMI. Much of the argument in this case has turned on the meanings to be given to these expressions.

[5]  The relevant provisions of the 2006 Regulations are as follows:

„foreign main proceeding“ means a foreign proceeding taking place in the State where the debtor has the centre of its main interests“ (Art 2 (g)) ...

ZIP Heft 37/2009, Seite 1777

„In the absence of proof to the contrary, the debtor's registered office, or habitual residence in the case of an individual, is presumed to be the centre of the debtor's main interests.“ (Art 16. 3)

[10]  As mentioned, SIB's registered office is in Antigua. Thus Antigua is presumed to be its COMI „in the absence of proof to the contrary“. In the present case the applications have been supported by written evidence; but none of that evidence has been tested by cross-examination. How, then, is the court to resolve any disputed question of fact? The answer, I think, is that the court should apply the same test as it applies in deciding questions of jurisdiction under the EC Judgments Regulation 44/2001: viz. that the court must be satisfied, or as satisfied as it can be having regard to the limitations which an interlocutory process imposes, that the company's COMI is not in the state in which its registered office is located: cf. Bols Distilleries BV v Superior Yacht Services Ltd [2007] 1 W.L.R. 12, § 28. No one argued for any different approach.

<zwtitel></zwtitel>COMI</zwtitel><//zwtitel>

...

[51]  The question of COMI was considered by the ECJ in Re Eurofood IFSC Ltd. (ZIP 2006, 907) ...

[60]  ... I must therefore consider what Eurofood decided. This is not the first time I have done so, although it is the first time that I have done so with the aid of adversarial argument. In Re Lennox Holdings Ltd [2009] BCC 155 I had to decide whether this court had jurisdiction to open insolvency proceedings in relation to two companies whose registered offices were in Spain. I decided that it did. Having set out extracts from the opinion of Jacobs A-G and the ECJ in Eurofood I said (§ 9):

„The two particular examples which were given by the court are, if I may respectfully say so, at two opposite and extreme ends of the spectrum. The facts of the present case, as I rather suspect the facts of most cases, lie somewhere between those two extremes. It is for that reason that the approach of the Advocate General is a particularly helpful one. What I should concentrate on is the head office functions of the two Spanish companies. It is, I should say, clear that the two Spanish companies do carry on business in the Member State where their registered offices is situated and consequently the „mere fact“ that its economic choices are or can be controlled by a parent company is not enough to rebut the presumption. That is not what is relied on in the present case. It is not control by a parent company that is relied on in the present case. It is control of the companies themselves by their boards of directors.“

[61]  Mr Zacaroli submitted that I was wrong to apply the simple test of „head office functions“ propounded by Jacobs A-G. He said that Jacobs A-G had expressly accepted the submission of the Italian administrator that ascertainability by third parties of the centre of main interests is not central to the concept of COMI (§ 114). That was inconsistent with the Advocate-General's own subsequent stress on the need for elements relied on to rebut the presumption in favour of the registered office to satisfy the twin requirements of transparency and ascertainability. More to the point, it was not consistent with the decision of the ECJ itself which emphasised that COMI must be identified by reference to criteria that are both objective and ascertainable by third parties (§ 33); and said in terms that the presumption in favour of COMI coinciding with the company's registered office could only be rebutted by factors which are both objective and ascertainable by third parties (Hervorhebungen des Gerichts). Simply to look at the place where head office functions are actually carried out, without considering whether the location of those functions is ascertainable by third parties, is the wrong test. The way in which the ECJ approached recital (13) was not to apply the factual assumption underlying it but to apply its rationale. I accept this submission. To the extent that I considered and applied the head office functions test in Re Lennox Holdings on the basis accepted by Jacobs A-G in § 114, I now consider that I was wrong to do so. Pre-Eurofood decisions by English courts should no longer be followed in this respect. I accept Mr Zacaroli's submission that COMI must be identified by reference to factors that are both objective and ascertainable by third parties. ...

[62]  This leads on to the next question: what is meant by „ascertainable“? ... one of the important features is the perception (Hervorhebung des Gerichts) of the objective observer. One important purpose of COMI is that it provides certainty and foreseeability for creditors of the company at the time they enter into a transaction. It would impose a quite unrealistic burden on them if every transaction had to be preceded by a set of inquiries before contract to establish where the underlying reality differed from the apparent facts.

[63]  In Eurofood the ECJ emphasised the importance of the presumption in favour of COMI coinciding with a company's registered office. In my judgment this means that the decision in Re Ci4net.com Inc, to the effect that the location of the registered office is no more than a factor to be considered, should also no longer be followed. In my judgment it follows from Eurofood that the location of a company's registered office is a true presumption, and the burden lies on the party seeking to rebut it.

[64]  I have already quoted Art 16 3 of the Model Law which enacts the same presumption. Commenting on this article the Guide to Enactment says (§ 122):

„Article 16 establishes presumptions that allow the court to expedite the evidentiary process: at the same time they do not prevent, in accordance with the applicable legal procedural law, calling for or assessing other evidence if the conclusion suggested by the presumption is called into question by the court or an interested party.“

[65]  I do not consider that this commentary, which explicitly refers to presumptions, detracts from the force of the decision of the ECJ in Eurofood. At this point I should refer to some of the decisions of courts of the USA. The USA gave effect to the Model Law as Chapter 15 of the Federal Bankruptcy Code. However, in enacting the equivalent of Article 16 3 Congress changed the wording. Instead of providing for the presumption in the absence of „proof“ to the contrary, the ZIP Heft 37/2009, Seite 1778equivalent provision in Chapter 15 provides for the presumption in the absence of „evidence“ to the contrary. The American jurisprudence thus holds that the burden of proof lies on the person who is asserting that particular proceedings are „main proceedings“ and that the burden of proof is never on the party opposing that contention: Re Tri-Continental Exchange Ltd 349 BR 629, 635, per Judge Klein. In Re Bear Stearns High-Grade Structured Credit Strategies Master Fund Ltd 374 BR 122 Judge Lifland said that except where there is no contrary evidence the registered office does not have any special evidentiary value. This change in language of the enactment, as it seems to me, may well explain why the jurisprudence of the American courts has diverged from that of the ECJ.

[66]  Professor Westbrook, the Receiver's expert on US law, explains in his first affidavit (§ 21) that: „The United States jurisprudence has made it clear that the COMI lies in the jurisdiction [where] the most material „contacts“ are to be found, especially management direction and control of assets.“

[67]  According to Re Bear Stearns High-Grade Structured Credit Strategies Master Fund Ltd these contacts can include the location of the debtor's headquarters, the location of those who actually manage the debtor, the location of the debtor's primary assets, the location of a majority of the debtor's creditors or of a majority of creditors who would be affected by the case and the jurisdiction whose law would apply to most disputes. However, none of these factors in the American jurisprudence is qualified by any requirement of ascertainability. In my judgment this is not the position taken by the ECJ in Eurofood.

[68]  Mr Isaacs also submitted that in a case where it is alleged that the company in question was used as a vehicle for fraud, the court should not investigate the COMI of the company itself. Rather it should investigate the COMI of the fraudsters pulling the strings. ... I reject this submission. First, in Eurofood the ECJ confirmed (§ 30): „that, in the system established by the Regulation for determining the competence of the courts of the member states, each debtor constituting a distinct legal entity is subject to its own court jurisdiction.“

[69]  Second, by its very nature the existence of a fraud behind the scenes is unlikely to be ascertainable by third parties. The whole point of a fraud is that it is kept secret for as long as possible. Third, the idea of ascertaining the COMI of the fraudsters is all very well if they all happen to have their COMI in the same state; but what if they do not? How then is the court to identify the relevant COMI? I add also that on the facts of the present case it has not been shown (and apart from generalised assertion there is no evidence) that SIB was established for fraudulent purposes which might amount to justification for piercing the corporate veil.

[70]  I hold therefore that:

i) The relevant COMI is the COMI of SIB;

ii) Since its registered office is in Antigua, it is presumed in the absence of proof to the contrary, that its COMI is in Antigua;

iii) The burden of rebutting the presumption lies on the Receiver;

iv) The presumption will only be rebutted by factors that are objective;

v) But objective factors will not count unless they are also ascertainable by third parties;

vi) What is ascertainable by third parties is what is in the public domain, and what they would learn in the ordinary course of business with the company.

...

<zwtitel></zwtitel>Main proceeding or non-main proceeding?</zwtitel><//zwtitel>

[96]  Whether the Liquidators are recognised as representatives of a main proceeding or a non-main proceeding depends on the COMI of SIB. It is only if the COMI is in Antigua that the Antiguan liquidation will be a main proceeding. I have already set out my understanding of the general principles that apply in determining the COMI of a corporation. I now apply those principles to the facts.

[97]  SIB's registered office was in Antigua. Thus it is presumed that its COMI was in Antigua. The onus is on the Receiver to rebut the presumption. SIB was not merely a „letterbox company“. Its physical headquarters were in Antigua; almost all of its employees were located in Antigua; its contracts both with investors and financial advisers were governed by the laws of Antigua; and its marketing material gave prominence to its presence in Antigua. Cheques from depositors were sent to Antigua and although wire transfers were not, wire transfers were not made to banks in the USA. Private banking facilities were provided from Antigua. It was regulated by Antiguan regulators and its accounts were audited by Antiguan accountants. In short its public face was that of an Antiguan corporation. All these features reinforce rather than rebut the presumption.

[98]  On the basis that, as I have held, the presumption can only be rebutted by factors that are both objective and ascertainable by third parties, Mr Isaacs relied on the following:

i) The locationy of the principal movers of the fraud (Sir Allen, Mr Davis and Ms Pendergest-Holt) was in the USA. This fact (if it is a fact) is not one that was ascertainable by third parties.

ii) The location of most of the directors was in the USA and none was in Antigua. It is true that the nationality of the directors was set out in marketing material and was thus ascertainable by third parties. But I cannot see that the nationality of the directors has any significant bearing on the COMI of the company. Mr Isaacs said that most of the board meetings were held by telephone. That raises an interesting question: if a meeting takes place by telephone, in what state does it take place? But I do not think that I need to answer that question, because the manner in which board meetings took place would not have been ascertainable by third parties.

iii) The principal place of business of SIB was in the USA. What Mr Isaacs relies on under this head is the marketing of certificates of deposit by financial advisers; and the provision of services to SIB by other Stanford companies. However, I do not consider that an investor would have considered that a financial adviser was conducting SIB's business; and the ZIP Heft 37/2009, Seite 1779disclosure statement made it clear to investors that marketing was not carried out by SIB. The paperwork for investments was processed in Antigua. When the certificates of deposit were issued they stated on their face that they had been executed in Antigua.

iv) The purchasers of certificates of deposit were all residents and citizens of countries other than Antigua. This is true. It may also have been ascertainable by third parties because SIB's marketing information said that they did business with the world. But I do not see that this fact points in favour of any single state other than Antigua. The presumption cannot be rebutted by an attempt to demonstrate that Antigua was not the COMI of SIB unless it is also shown that SIB had a COMI in some other state. It is not possible for a corporation to have a world-wide COMI.

v) The investments were managed outside Antigua, mostly in the USA. This is true. To some extent this was ascertainable by third parties because SIB's marketing material puffed its association with other Stanford companies and revealed the existence of portfolio management teams, and its accounts revealed large payments to other Stanford companies as management fees. But I do not consider that management carried out by other companies under contractual arrangements with SIB changes SIB's COMI. It has chosen to manage its affairs by outsourcing some functions to others.

vi) The real management of SIB was carried out by employees in the USA. In so far as this point relies on what was happening behind the scenes, it relies on facts that would not have been ascertainable to third parties. In so far as it relies on the location of the financial advisers, I have already dealt with that. It was suggested that the marketing of SIB as part of the Stanford Group anchored it to the USA; but marketing material for the Stanford Group was always careful to refer to SIB's location in Antigua.

vii) The location of books and records relating to the primary business of investments was in the USA. Books and records relating to the investors themselves were kept in Antigua. The Liquidators have adequate records in Antigua to enable them to contact investors and deal with their claims. This point relates to records of investments. The primary records about investments were kept in the USA although investment summaries were regularly sent to Antigua. This may be true as far as it goes, but what it shows is that SIB's books and records were split between Antigua and the USA.

viii) SIB's assets were located outside Antigua and mostly in the USA. It is true that SIB's investment assets were located outside Antigua. But it is not true that they were mostly located in the USA. More assets are located in the UK and in Switzerland than in the USA. Since its business was the world-wide investment of funds, the location of the investments themselves is not significant as regards SIB's COMI.

[99]  In my judgment these features, even when taken together, are not sufficient to rebut the presumption in favour of Antigua as the COMI of SIB, reinforced as it is by other objective facts ascertainable to third parties. I hold, therefore, that Antigua was the COMI of SIB and that, in consequence, the Liquidators are entitled to recognition as foreign representatives of a foreign main proceeding. ...

<einsender></einsender>Mitgeteilt von Dr. Jessica Schmidt, Jena</einsender><//einsender><hinweis></hinweis>

Anmerkung der Redaktion:

Siehe hierzu den Kurzkommentar von Schmidt, EWiR 2009, Heft 18.

</hinweis><//hinweis>

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