On 30 July 2018 the Cayman Islands (‘Cayman’) Grand Court (‘Court’) issued a new practice direction (‘PD’) No: 1 of 2018 which provides that those involved in cross-border insolvency cases should consider as soon as possible whether to incorporate some or all of existing guidelines into an international protocol to be approved by the Court or an Order of the Court adopting the guidelines.

What are the existing guidelines?

The two guidelines for court-to-court communications and co-operation attached to the PD and referred to in the PD itself which the Court considers might be adopted in Cayman (with appropriate modifications) are the:

  1. 1.       American Law Institute/International Insolvency Institute Guidelines Applicable to Court-to-Court Communications in Cross-Border Cases (May 16 2000) (see here for an example);and
  2. 2.      The Judicial Insolvency Network Guidelines for Communication and Cooperation between Courts in Cross-Border Insolvency Matters (see here for an example).

Who should consider the Guidelines and when?

Whether to incorporate some or all of the Guidelines (with suitable modifications) either into an international protocol to be approved by the Court or an order of the Court adopting the Guidelines should be considered ‘at the earliest opportunity’ by all officeholders appointed in Cayman, companies subject to restructuring proceedings supervised by the Court and any other interested parties involved in cross-border insolvency cases. If any are unclear as to the manner in which to use and apply the Guidelines in any particular case, they may apply to the Court at any early stage in the proceedings for directions.

What sort of proceedings are covered?

The Guidelines are relevant where the insolvency or restructuring proceedings in respect of an individual, or any company or other legal entity whether incorporated or established in Cayman or abroad are being supervised by, or involve related applications to, courts in more than one jurisdiction. This includes:

  •         liquidations (including provisional and voluntary liquidations) and other insolvency or restructuring proceedings which involve applications to Court;
  •         schemes of arrangement relating to a company being supervised by the Court which also involve a parallel scheme (or debt adjustment proceeding) or ancillary proceedings in another jurisdiction.

What do the Guidelines cover?

The Guidelines primarily cover the procedural rules that may be adopted and applied in particular cross-border cases for:

  • o  regulating the manner of communications between the courts involved;
  • o  the appearance of counsel in each court;
  • o  notification to parties in parallel proceedings;
  • o  the acceptance as authentic of official documents or orders made in the foreign jurisdiction or court and joint hearings.

How are they applied to proceedings?

The Guidelines (subject to any modifications which were considered necessary) would be incorporated into a protocol between the officeholders in the different jurisdictions and which would then be approved by the Court and other courts involved. Alternatively, they can be incoporated by a separate order of the Court (and other courts as required) without a protocol.

Do liquidators have to enter into cross-border protocols?

An Official Liquidator (‘OL’) of a Cayman incorporated company is already required to consider whether to enter into an international protocol which deals with the matters set out in Companies Winding Up Rules (‘CWR’) 0.21, r.3. Having considered the question an OL can conclude that a protocol is not appropriate or that they consider that the appropriate protocol is one which does not incorporate the Guidelines. An OL can also agree, subject to the approval of the Court, to enter into a protocol that covers those matters in CWR O21,r.3 but also other matters such as those in the Guidelines on court-to-court communications and cooperation.

Where a company is in liquidation under Part V of the Companies Law (2018 Revision) and it is either subject to a concurrent bankruptcy proceeding under the law of a foreign country or has assets located in a foreign country which are the subject of a bankruptcy proceeding or receivership under the law of that country, a Cayman OL is under a duty, under CWR O21, r.2(1), to consider whether it is appropriate to enter into an international protocol with any foreign officeholder. This is to promote the orderly administration of the estate of the company to avoid duplication of work and conflict between the official liquidator and the foreign officeholder and the protocol only takes effect when approved both by the Court and also the court in the other jurisdiction(s).

Solomon Harris
Solomon Harris has many years of experience in all forms of disputes arising from fund liquidations and receiverships. If you are would like further information on how we can help, contact Laura HatfieldTom Wright or Kai McGriele.
The information contained in this article is necessarily brief and general in nature and does not constitute legal advice. Appropriate legal or other professional advice should be sought for any specific matter.


From time to time our firm hosts or sponsors events of interest to our clients. Please join our mailing list if you would like to be notified of upcoming events.

  • Lawyers World Global Awards Solomon Harris
  • World Finance Awards 2012 Solomon Harris
  • IFLR 1000 2011 Recommended Firm
  • 2011 Acquisition Legal Awards
  • ACQ Law Awards 2011 Solomon Harris
  • Corporate Intl Awards Law Firm of the Year Cayman Islands
  • Deal Makers Global Awards
  • Finance Monthly Global Awards 2012 Solomon Harris
  • Solomon Harris wins IFLR Asia Awards
  • Lawyer Monthly
  • The Lawyer Top 30 Offshore
  • Captive Review's Offshore Firm of the Year award
  • IFLR 1000 2014 Recommended Firm

Solomon Harris is a member of AIMA

Real Estate Agents and Property Developers have until 29 May 2019 for AML Registration...

A Special Notice published by the Cayman Islands (‘Cayman’) Department of Commerce and...

View All Latest News
  Cayman Islands +1 345 949 0488
  Like Solomon Harris on Facebook Follow Solomon Harris on Twitter +1 Solomon Harris Follow Solomon Harris on LinkedIn Contact Us
Cayman Islands +1 345 949 0488
Like Solomon Harris on Facebook Follow Solomon Harris on Twitter +1 Solomon Harris Follow Solomon Harris on LinkedIn
Contact Us