New court practice in the COMI?

by Dr Enikõ Vida

A case-by-case decision of the European Court of Justice was recently published which addressed how Article 3 (1) of the Insolvency Regulation 2015 (COMI) should be interpreted. The issue was: does the court of a member state (to which an application for the opening of main insolvency proceedings has been made) retain exclusive jurisdiction to open these proceedings if the centre of the debtor’s main interests has been transferred to another member state after that application was lodged, but before that court had made a decision on it.

According to the factual circumstances, the creditors of a holding company with its registered office in the United Kingdom lodged a request to open insolvency proceedings before the High Court. However, in the meantime, the centre of the main interest (COMI) of the holding company had moved to Germany and the creditors attempted to lodge another request to open insolvency proceedings before the German courts, while the High Court was yet to deliver a decision on the first request.

As a consequence, the Court did not depart from its previous practice, and confirmed that the court of a member state had jurisdiction (to which the request to open main insolvency proceedings had been submitted), even when the centre of the debtor’s main interests had moved to another member state after that request was filed, but before the first court had passed its decision about opening of the procedure.

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Business Recovery & Insolvency Debt Collection & Bankruptcy Law Insolvency Debt Collection, Restructuring & Insolvency Hungary Kovacs Reti Szegheo KRS