Winding-up petition in which the principal issue is whether or not Office Metro Limited can be wound up in this jurisdiction in the light of the fact that, despite its being an English registered company, its centre of main interest is in Luxembourg. The question which was to be determined was whether or not it had an ‘establishment’ in this country for the purposes of the Insolvency Regulation.
Mann J explained what amounted to economic activity within the meaning of the Regulation: ‘ However, I do not think that it amounts to economic activity within the meaning of the Regulation. By the time of the petition it seems that the only ‘activity’ (and I deliberately put it in inverted commas) was to sit there being liable on guarantees, sometimes paying out on them, and perhaps doing whatever else was necessary to keep itself alive in terms of compliance with formalities such as company filings. Mr Wetheral (or perhaps his staff) occasionally sought legal or accounting advice, but there is no evidence it was doing anything else. Being in a state of liability, with the need sometimes to pay out on that liability and take a bit of advice, is not an economic activity for the purposes of the Regulation. Neither is seeking accounting or legal assistance on other matters. Forwarding post (which is said to have happened at Chertsey) is not an economic activity carried on there. It is something which goes on so that someone can carry it on somewhere else. Utilising the guidance given in the Virgos-Schmit report, it is not conducting activities on the market.
The activities necessary for compliance (filing and so on) are not, apparently, carried out at the Chertsey office. They are therefore not carried out at the only candidate for a place of operations.
Even if I am wrong as to whether Office Metro’s residual activities are economic activity for the purposes of the Regulation, I do not consider that they are non-transitory. They are not a consistent activity. The activities involved in paying up on guarantees do not have the character of a consistent business or business-type activity. They arise as and when needed, and were all going well in the underlying group they would not arise at all. The concept of ‘establishment’ is the one chosen as the touchstone of sufficient presence to justify the opening of insolvency proceedings. There are three ingredients for these purposes: (i) a place where things happen, and (ii) sufficient things (iii) of sufficient quality happening there. The concept of non-transitoriness goes to the third of them. In my view the converse of something being transitory is not confined merely to things which are ‘fleeting’ (to use one English synonym) but is also intended to encapsulate such things as the frequency of the activity; whether it is planned or accidental or uncertain in its occurrence; the nature of the activity; and the length of time of the activity itself. When measured against all these elements I consider that the activities of procuring payment on the guarantees is transitory (or not non-transitory) for the purposes of the Regulation. This is to a large extent a value judgment in respect of which one cannot be prescriptive of the elements to be fulfilled (or not fulfilled), but in my view it is plain that if the activities were otherwise economic activities they would, for these purposes, be ‘transitory’ for the purposes of the Regulation.’
Mann J
[2012] EWHC 1191 (Ch), [2012] ILPr 30, [2012] BCC 829, [2012] BPIR 1049
Bailii
EU Regulation 1346/2000 3
England and Wales
Cited by:
Cited – Olympic Airlines Sa Pension and Life Assurance Scheme v Olympic Airlines Sa ChD 29-May-2012
Olympic Airlines, incorporated in Greece, but with headquarters in London, went into liquidation. The pensions scheme had been run with a deficit. The trustees no sought the winding up of the company under British law.
Held: To be an . .
Cited – Olympic Airlines Sa Pension and Life Insurance Scheme v Olympic Airlines Sa CA 6-Jun-2013
The court considered the the jurisdiction under EU law to commence a secondary winding-up in England of a company whose main liquidation is taking place in Greece. That depended upon whether the company, registered in Greece had a sufficient . .
Cited – Olympic Airlines Sa Pension and Life Assurance Scheme, The Trustees of The v Olympic Airlines Sa SC 29-Apr-2015
The airline was incorporated in Greece but with an office in the UK. It became insolvent leaving a deficit in the UK employee pension scheme. The trustees of the fund sought a secondary insolvency within the UK, and now a reference to the European . .
Lists of cited by and citing cases may be incomplete.
Insolvency, Jurisdiction
Leading Case
Updated: 23 December 2021; Ref: scu.457573
