Liquidation – foreign company – order could be made for oral examination of officer of foreign company or other persons of information which foreign liquidator required
C, a Cayman Islands company, which provided vocational technology education in mainland China, was wound up in Shanghai and Cayman and Ls were appointed joint provisional liquidators. Pursuant to a letter of request from the Cayman Islands Court seeking the Hong Kong Court’s assistance by exercising its common law powers to order C’s former chairman and director (“X”) to produce documents, answer interrogatories and attend court for oral examination (the “Orders”). Ls applied for recognition of their appointment and the Orders. The Court considered the Orders were necessary and made a recognition order. At issue was whether an order could be made for the oral examination of an officer of a foreign company or other persons of information which the foreign liquidator required for the proper investigation of the company’ affairs; and whether such an order infringed Art. 96 of the Basic Law, which provides that “With the assistance or authorisation of the Central People’s Government, the Government of the Hong Kong Special Administrative Region may make appropriate arrangements with foreign states for reciprocal juridical assistance.”
Held, granting the Orders, that:
- The common law power of assistance extended to ordering an oral examination if such a power existed (a) in the jurisdiction of liquidation and that was the jurisdiction of incorporation; and (b) in the assisting jurisdiction. This was the case here. Section 103 of the Companies Law in the Cayman Islands grants the court similar powers to order the production of documents by and an oral examination of a director of a company as in s. 221 of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32). Thus, exercising its common law powers, the Hong Kong Companies Court could order the oral examination of a director of a Cayman company in liquidation in the Cayman Islands if satisfied that it was necessary and it would not infringe the established limitations on the exercise of the power conferred by s. 221.
- Reciprocity was not a necessary component of recognition of and assistance to foreign liquidators. Rather, the power to provide judicial assistance was founded firmly in the common law. The common law power of recognition of and assistance was clearly part of the laws in Hong Kong prior to 1997 and, given their character, there was no reason to suggest that they contravened the Basic Law.