The concept of receivership is not recognised in the Companies Law in Jersey. However, the Royal Court has recently appointed an asset receiver and there are law reform discussions taking place that contemplates introducing receivership into the Security Interests (Jersey) Law 2012 to permit appointment in the event of default of a secured debt. It is fairly common for a Jersey-registered company that has its COMI elsewhere to have its affairs wound up in another jurisdiction. The best example of this is the UK administration process where letters of request are frequently issued by the Royal Court in Jersey to, for example, the English Court, for a Jersey company to be placed into administration in England. The disconnect with the two laws manifests itself at the end of the English administration, where no provision in the English law exists for a Jersey company to be placed into English creditors’ winding up. A Jersey liquidation may then follow! What are the most common insolvencyrelated concerns faced by businesses in Jersey? Commonly encountered concerns for Jersey based businesses mirror the challenges of mainland economies as How are companies’ options for insolvency limited in Jersey? The options for companies entering into a formal insolvency process in Jersey are currently limited to liquidation. This contrasts with Guernsey, where administration and a differing liquidation process exist. Importantly, Jersey law is markedly different from English law and anybody seeking an insolvency or restructuring solution in Jersey should consult a resident Jersey insolvency practitioner or experienced advocate on the island. Unfortunately, at present, modern restructuring procedures such as administration or a Company Voluntary Arrangement do not exist. A recent law change in 2022 introduced a modern creditors’ winding up process whereby a creditor can issue a statutory demand and, if unanswered or a company is demonstrably insolvent, can petition the Court for a winding up order. The Jersey Companies Law has provision for compromises and arrangements with a cram down element, but these are not commonly used for insolvency restructuring processes other than in large cases. 64 LAWYERMONTHLY FEBRUARY 2023 Approaching Insolvency in Jersey Thought Leader Jersey law stands distinct from that of the UK when it comes to avenues of insolvency available to businesses. We explore companies’ options further in this exclusive interview with Alan Roberts, director at Grant Thornton, who also shares his thoughts on how the insolvency sector in Jersey may develop in the near future. Contact Alan Roberts Director, Grant Thornton 2nd Floor, Kensington Chambers, 46/50 Kensington Pl, St Helier JE1 1ET, Jersey Tel: +44 01534 885742 E: Alan.Roberts@gt-ci.com www.grantthorntonci.com
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