In any economy, especially during downturns, business failures are a reality - Enron, HIH, Ansett, Global Crossing, APP - the list goes on. According to Standard Poor's, a record number of companies defaulted on their debt in 2001, and that trend appears to be continuing. As companies defaulting on their debt are generally in financial difficulty, an event of default will often force lenders to make a difficult decision - do they support the company through a restructuring or workout process or do they cut their losses and put in a receiver or liquidator.
In Hong Kong there is no statutory form of workout. That is, a formal, court driven process under which a...
