Commercial Restructuring & Creditor Protection under UK CIGA 2020

“The introduction of the Part 26A Restructuring Plan within the Corporate Insolvency and Governance Act 2020 has fundamentally altered English insolvency jurisprudence. By incorporating a statutory cross-class cram-down mechanism (Section 901G), the High Court is empowered to bind dissenting classes of secured creditors, provided Condition A (the 'no worse off' test under Section 901G(3)) and Condition B (approval by an in-the-money class under Section 901G(5)) are satisfied. In Re Virgin Active Holdings Ltd [2021] EWHC 1246 (Ch), Snowden J affirmed that out-of-the-money landlord creditors had no genuine economic interest in the company’s restructuring surplus, thereby legitimizing the court's sanction of the plan despite substantial class dissent...”