The English High Court has decided that single ship SPVs with registered offices in Cyprus had their COMI in England.
Administrators were appointed to eight companies. Six of those companies were special purpose vehicles (SPVs) that had a single asset - a ship. The other two companies were the immediate and ultimate parent of the SPVs. All eight companies were incorporated in Cyprus and shared a common registered office there. Marine Cross a company based in London was shipping agent for all the companies.
The Court decided that the COMI of each of the eight companies was in England. That was where each set of creditors of each company would have considered the relevant company to be based particularly given the involvement of Marine Cross with which most creditors dealt.
The decision is good news for companies, lenders and other creditors wishing to avail themselves of English insolvency processes. The importance of objective factors ascertainable by third parties dealing with the company was stressed. Here a critical factor was that the shipping agent Marine Cross in London both made and received payments relating to the shipping business on behalf of the companies. Any of the eight companies creditors' queries were ultimately dealt with in London by the agent who was also named as the contact for the companies in the English Law governed loan agreements entered into by the companies with their syndicate of banks.