Extraordinary Procedure over Agrokor Fully Recognized in the United States
Nov 02, 2018
The US Bancruptcy Court for the Southern District of New York issued its written opinion in Chapter 15 proceedings (cross-border insolvency proceedings) whereby it confirmed its recognition of the EA Proceedings and the Settlement Plan in the US with respect to Agrokor and its affiliated companies. In its opinion the Court approved Agrokor’s recognition petition to a greater extent than it had done initially at the hearing, i.e. the court granted Agrokor’s petition to recognize the Settlement Plan in full, explicitly including its provisions affecting the debt of Agrokor and its affiliated companies governed by English law.
“The full recognition, in obtaining which particular efforts were exerted, afforded the legal protection from the initiation of any other proceedings for debt recovery in the US as well as protection from claims for the recovery of debt against Agrokor and its affiliated companies on their assets located in the US, which we consider to be a great success to the benefit of all creditors and employees”, said Extraordinary Commissioner Fabris Peruško.
The Ruling of the US Bankruptcy Court also stipulates that the recognition of express provisions of the Settlement Plan shall become final in the US once the Settlement Plan becomes effective in Croatia, which condition has been met with the decision of the High Commercial Court of Zagreb dated 18 October 2018 that was published on 26 October 2018.
The recognition of the EA Proceedings over Agrokor and its subsidiary and affiliated companies as insolvency proceedings before the United States courts is yet another in a number of international confirmations of the EA Proceedings over Agrokor.
In particular, the High Court of England and Wales on 9 November 2017 accepted the Act on Extraordinary Administration Proceedings in Companies of Systemic Importance to the Republic of Croatia as insolvency proceedings recognized in England and Wales. The same was done by the Swiss Court on 2 February 2018 for the territory of Switzerland. It is particularly important that the aforesaid Act, together with the Bankruptcy Act, was included in the list of national laws recognized as insolvency proceedings on the entire territory of the European Union by the Directive of the European Parliament and Council of July 2018. Prior to that, the Constitutional Court of Croatia decided on 8 May 2018 that the aforesaid Act was in compliance with the Constitution of the Republic of Croatia.