Guernsey—restructuring and insolvency guide
Produced in partnership with Simon Davies, Mathew Newman and Alex Horsbrugh-Porter of Ogier Group
Guernsey—restructuring and insolvency guide

The following Restructuring & Insolvency practice note Produced in partnership with Simon Davies, Mathew Newman and Alex Horsbrugh-Porter of Ogier Group provides comprehensive and up to date legal information covering:

  • Guernsey—restructuring and insolvency guide
  • Questions
  • What legislation is applicable to insolvencies and reorganisations? What criteria are applied in your jurisdiction to determine if a debtor is insolvent?
  • What courts are involved in the insolvency process? Are there restrictions on the matters that the courts may deal with?
  • What entities are excluded from customary insolvency proceedings and what legislation applies to them? What assets are excluded from insolvency proceedings or are exempt from claims of creditors?
  • Has your jurisdiction enacted legislation to deal with the financial difficulties of institutions that are considered ‘too big to fail’?
  • What principal types of security are taken on immovable (real) property?
  • What principal types of security are taken on movable (personal) property?
  • What remedies are available to unsecured creditors? Are the processes difficult or time-consuming? Are pre-judgment attachments available? Do any special procedures apply to foreign creditors?
  • What are the requirements for a debtor commencing a voluntary liquidation case and what are the effects?
  • More...

Questions

What legislation is applicable to insolvencies and reorganisations? What criteria are applied in your jurisdiction to determine if a debtor is insolvent?

All formal insolvencies and reorganisations of Guernsey companies are governed by the Companies (Guernsey) Law, 2008 (Companies Law) which deals with schemes of arrangement, administrations and liquidations of Guernsey companies, together with specific insolvency legislation related to cellular companies and cells. Less formal collective insolvency procedures also exist (known as désastre and saisie) although these are not governed by legislation because they derive from the customary law which has existed in Guernsey since at least medieval times.

Limited partnerships can be subject to a winding-up process known as dissolution under the Limited Partnerships (Guernsey) Law, 1995 (as amended) (LP Law). In addition, the Loi Relative aux Debiteurs et Renonciation, 1929 (which is in the French language) (1929 Law) applies to all types of debtor, including individuals. There is no specific bankruptcy/personal insolvency legislation in Guernsey. Preferential debts are governed by the Preferred Debts (Guernsey) Law, 1983 as amended by the Preferred Debts, Désastre Proceedings and Miscellaneous Provisions (Guernsey and Alderney) Law, 2006. If the debtor is a company, the test for insolvency is whether the company is either cash flow insolvent (ie it cannot pay its debts as they fall due) or balance sheet insolvent (ie its assets are less than its liabilities)—see section

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