Re King & Wood Mallesons and other matters [2025] SGHC 67

Case Details

• Citation: [2025] SGHC 67
• Court: General Division of the High Court of the Republic of Singapore
• Decision Date: 11 April 2025
• Coram: Aedit Abdullah J
• Case Number: Originating Application No 90 of 2025; Originating Application No 91 of 2025; Originating Application No 92 of 2025
• Hearing Date(s): 14 March 2025
• Claimants / Plaintiffs: King & Wood Mallesons (as reorganisation administrator of Jiangsu Delong Nickel Industry Co Ltd, Xiangshui Hengsheng Stainless Steel Casting Co Ltd, and Yan Cheng City Hong Chuang Trading Co Ltd)
• Counsel for Claimants: Sim Kwan Kiat, Ho Zi Wei, Foung Han Peow and Jung Sangbum (Rajah & Tann Singapore LLP)
• Practice Areas: Insolvency Law; Cross-border insolvency; Recognition of foreign insolvency proceedings; UNCITRAL Model Law

Summary

In Re King & Wood Mallesons and other matters [2025] SGHC 67, the General Division of the High Court of Singapore addressed three concurrent originating applications seeking the recognition of reorganisation proceedings commenced in the People’s Republic of China (“PRC”) under the Insolvency, Restructuring and Dissolution Act 2018 (“IRDA”). The applications were brought by King & Wood Mallesons (“KWM”), acting as the court-appointed reorganisation administrator for three key entities within the Delong Group: Jiangsu Delong Nickel Industry Co Ltd (“JDNI”), Xiangshui Hengsheng Stainless Steel Casting Co Ltd (“XHSS”), and Yan Cheng City Hong Chuang Trading Co Ltd (“YCHC”) (collectively, the “Delong Companies”). This decision is a significant addition to Singapore’s cross-border insolvency jurisprudence, particularly regarding the recognition of PRC-based insolvency processes and the eligibility of non-natural persons to serve as “foreign representatives” under the UNCITRAL Model Law on Cross-Border Insolvency (the “Model Law”).

The dispute arose following the financial distress of the Delong Group, a major stainless steel enterprise. Creditors initiated reorganisation proceedings in the PRC People’s Court of Xiangshui County, which subsequently consolidated the proceedings of 28 group entities due to a high degree of confusion in their legal personalities and financial management. The Applicant sought recognition in Singapore to facilitate the investigation of substantial asset transfers and transactions involving Singapore-incorporated subsidiaries and multi-billion dollar receivables. The Court was required to determine whether the PRC reorganisation qualified as a “foreign proceeding” and whether a law firm, KWM, could be recognised as a “foreign representative” despite not being a natural person.

Aedit Abdullah J granted the applications in their entirety, recognising the PRC reorganisation as a “foreign main proceeding.” The Court applied the five-pronged test established in [2023] 2 SLR 421, finding that the PRC process was a collective judicial proceeding under insolvency law for the purpose of reorganisation. Crucially, the Court reaffirmed that the definition of a “foreign representative” under Article 2(i) of the Model Law is broad enough to encompass corporate entities or partnerships, provided they are authorised to administer the debtor’s assets or affairs. This holding provides essential clarity for practitioners dealing with jurisdictions where institutional administrators, rather than individual practitioners, are the norm.

The broader significance of the judgment lies in its pragmatic approach to the “Center of Main Interests” (“COMI”) analysis and the granting of discretionary relief under Article 21 of the Model Law. By allowing the Applicant to administer and realise Singapore-based assets, the Court empowered the reorganisation administrator to scrutinise transactions involving “nominal consideration” and the assignment of RMB 5 billion in receivables. This reinforces Singapore’s role as a supportive jurisdiction for complex, multi-jurisdictional restructurings, particularly those originating from China, and demonstrates the efficacy of the Model Law framework in protecting creditor interests across borders.

Timeline of Events

1. 24 July 2024: A creditor of XHSS applied to the PRC People’s Court of Xiangshui County, Jiangsu Province (the “PRC Court”) for XHSS to be placed in reorganisation.
2. 30 July 2024: Related procedural steps were taken in the PRC regarding the financial status of the Delong Group entities.
3. 1 August 2024: The PRC Court granted the XHSS reorganisation application and the JDNI reorganisation application, formally commencing the proceedings.
4. 19 August 2024: The PRC Court appointed King & Wood Mallesons as the reorganisation administrator for both XHSS and JDNI.
5. 30 August 2024: The Applicant applied to the PRC Court for the reorganisation proceedings of JDNI and 27 other entities (including XHSS and YCHC) to be consolidated.
6. 30 October 2024: The PRC Court granted the Consolidation Application, finding substantial confusion in the legal personalities and financial management of the 28 entities.
7. 20 January 2025: The Applicant filed the Originating Applications in the Singapore High Court seeking recognition and relief.
8. 24 January 2025: Mr. Jing Zhong filed his first affidavit in support of the applications, providing expert evidence on the Chinese insolvency regime.
9. 17 February 2025: Further evidentiary materials were submitted to the Singapore Court regarding the Singapore-based assets and transactions.
10. 14 March 2025: The substantive hearing of Originating Application Nos 90, 91, and 92 of 2025 took place before Aedit Abdullah J.
11. 11 April 2025: The High Court delivered its judgment granting recognition and the requested reliefs.

What Were the Facts of This Case?

The Delong Group is a large-scale enterprise based in the PRC, primarily engaged in the production and sale of nickel alloy and stainless steel products. The three companies at the heart of the Singapore applications were Jiangsu Delong Nickel Industry Co Ltd (“JDNI”), Xiangshui Hengsheng Stainless Steel Casting Co Ltd (“XHSS”), and Yan Cheng City Hong Chuang Trading Co Ltd (“YCHC”). JDNI was the core entity of the group, while XHSS focused on casting and YCHC on trading. All three were incorporated in the PRC with their registered offices and primary operations located in Jiangsu Province.

The group’s financial collapse led to reorganisation proceedings in the PRC Court. On 24 July 2024, a creditor initiated the process against XHSS. By 1 August 2024, the PRC Court had placed both XHSS and JDNI into reorganisation. King & Wood Mallesons, a major international law firm, was appointed as the administrator. The PRC Court later consolidated the proceedings of 28 Delong Group entities, including YCHC, into a single consolidated reorganisation. This consolidation was predicated on the finding that the companies operated as a single economic unit with indistinguishable assets and liabilities, making individual reorganisations impossible or inequitable for creditors.

The Applicant’s investigation into the Delong Companies’ affairs revealed significant connections to Singapore, which necessitated the recognition applications. Three specific transactions or asset holdings were identified as requiring urgent attention from the reorganisation administrator:

First, XHSS had previously held a 100% shareholding in a Singapore-incorporated company, Alchemist Metal Industry Pte Ltd (“AMI SG”). However, on 15 May 2024, XHSS transferred these shares to another Singapore entity, Gunbuster Nickel Industry Pte Ltd (“GNI SG”), for what was described as “nominal consideration.” The Applicant sought to investigate whether this transfer constituted an undervalue transaction or a fraudulent preference designed to shield assets from creditors.

Second, JDNI held shares in Sino Virtue International Development Pte Ltd (“Sino Virtue”), another Singapore company. These shares had been mortgaged to CFHI Financial Leasing Co Ltd (“CFHI”), a Chinese entity, to secure a debt. CFHI had subsequently taken steps to enforce this mortgage. The Applicant required recognition in Singapore to manage JDNI’s interests in Sino Virtue and potentially challenge the enforcement actions if they were found to be inconsistent with the reorganisation plan.

Third, YCHC was involved in a massive assignment of receivables. YCHC had assigned its rights to receive approximately RMB 5 billion from an Indonesian company, PT GNI, to AMI SG (the Singapore subsidiary formerly owned by XHSS). This assignment occurred on 26 May 2023. Given the scale of the debt—equivalent to hundreds of millions of dollars—the Applicant needed the power to trace these funds and ensure they were accounted for within the consolidated reorganisation estate.

The Applicant argued that without recognition in Singapore, it would be unable to effectively exercise its powers to recover these assets or stay individual creditor actions in Singapore that might disrupt the PRC reorganisation. The applications were supported by the expert affidavit of Mr. Jing Zhong, which detailed the nature of the PRC Enterprise Bankruptcy Law and the specific orders made by the PRC Court. No creditors appeared to oppose the applications during the hearing on 14 March 2025.

What Were the Key Legal Issues?

The Court identified several critical legal issues that had to be resolved to determine if the PRC proceedings could be recognised and what relief was appropriate:

• Qualification as a “Foreign Proceeding”: Did the PRC reorganisation proceedings satisfy the definition in Article 2(h) of the Model Law? This required an analysis of whether the proceedings were collective, judicial/administrative, under an insolvency law, and subject to court supervision for the purpose of reorganisation.
• Status of the “Foreign Representative”: Could King & Wood Mallesons, a partnership/corporate entity, qualify as a “foreign representative” under Article 2(i)? The Court had to decide if the Model Law restricted this role to natural persons.
• Determination of COMI: Where was the Center of Main Interests for each of the Delong Companies? The Court applied the presumption in Article 16(3) that the COMI is the place of the registered office and considered whether any factors rebutted this presumption.
• Public Policy Exception: Would recognition of the PRC proceedings be “manifestly contrary to the public policy of Singapore” under Article 6 of the Model Law?
• Entitlement to Relief: If recognised, what reliefs under Articles 20 and 21 were necessary and appropriate to protect the assets of the debtors and the interests of the creditors?

How Did the Court Analyse the Issues?

The Court’s analysis began with the definition of a “foreign proceeding.” Aedit Abdullah J applied the five requirements set out in Ascentra Holdings, Inc (in official liquidation) and others v SPGK Pte Ltd [2023] 2 SLR 421 at [29]. The Court found that the PRC reorganisation was clearly “collective” as it concerned all creditors and aimed at a group-wide solution. It was “judicial” because it was conducted under the authority and supervision of the PRC Court. It was based on the PRC Enterprise Bankruptcy Law, which is a “law relating to insolvency.” The property and affairs of the Delong Companies were subject to the control of the PRC Court and the Applicant, and the purpose was reorganisation. As the Court noted at [27], the concept of a “judicial/administrative proceeding” is broad, following the approach in Re Compuage Infocom Ltd [2025] SGHC 49.

The most significant doctrinal hurdle was whether KWM could be a “foreign representative.” Article 2(i) defines a foreign representative as a “person or body” authorised in a foreign proceeding to administer the reorganisation. The Court noted that in many jurisdictions, including the PRC, it is common for professional firms rather than individual practitioners to be appointed as administrators. Relying on his own previous decision in Re Genesis Asia Pte Ltd [2024] 4 SLR 570, Aedit Abdullah J held:

“I accepted the applicant’s submission that it qualified as a ‘foreign representative’ notwithstanding that it was not a natural person.” (at [31])

The Court reasoned that the term “body” in Article 2(i) and the general definition of “person” in Singapore law (which includes corporate entities) supported this inclusive interpretation. Restricting the definition to natural persons would create unnecessary friction in cross-border recognition where foreign courts prefer institutional appointments.

Regarding COMI, the Court applied Article 16(3) of the Model Law. The registered offices of JDNI, XHSS, and YCHC were all in the PRC. The Court looked for factors that might rebut this presumption, such as the location of management, assets, and the expectations of creditors. The evidence showed that the companies’ primary operations, headquarters, and the vast majority of their creditors were located in China. Furthermore, Chinese law applied to most of their disputes. Consequently, the Court found that the COMI was in the PRC, making the proceedings “foreign main proceedings” under Article 17(2)(a).

The Court then addressed the public policy exception in Article 6. This exception is intended to be restrictive, applying only where recognition would violate fundamental principles of the forum’s legal order. The Court found no evidence that recognising the PRC reorganisation would prejudice Singapore’s public policy. On the contrary, the Court noted that facilitating cross-border insolvency cooperation is itself a matter of public policy. The Court cited Re Fullerton Capital Ltd (in liquidation) [2025] CA 11 and Re Fullerton Capital Ltd (in liquidation) [2024] SGHC 155 regarding the standards for recognition and the importance of protecting the integrity of the insolvency process.

Finally, the Court considered the scope of relief. Under Article 20, recognition of a foreign main proceeding triggers an automatic stay of individual actions. Under Article 21, the Court has discretion to grant additional relief. The Applicant requested the power to administer and realise assets in Singapore. The Court found this appropriate given the suspicious nature of the AMI SG share transfer and the RMB 5 billion receivable assignment. The Court observed that the power to investigate and reverse transactions is a core function of an insolvency representative, citing Re Lion City Holdings Pte Ltd [2003] 3 SLR(R) 493 and United Overseas Bank Ltd v Loh Ah Peng Shane [2021] 2 SLR 950. The Court was satisfied that the interests of Singapore creditors (if any) were sufficiently protected by the Applicant’s duty to report to the PRC Court and the oversight provided by the Model Law framework.

What Was the Outcome?

The High Court granted the orders sought in Originating Application Nos 90, 91, and 92 of 2025. The PRC reorganisation proceedings in respect of JDNI, XHSS, and YCHC were formally recognised as “foreign main proceedings” under the Third Schedule of the Insolvency, Restructuring and Dissolution Act 2018.

The Court issued the following specific orders:

• Recognition: The PRC Reorganisation Proceedings were recognised as foreign main proceedings pursuant to Article 17 of the Model Law.
• Stay of Proceedings: An automatic stay was imposed on all individual actions or proceedings concerning the Delong Companies’ assets, rights, obligations, or liabilities in Singapore, as provided for under Article 20.
• Entrustment of Assets: Pursuant to Article 21(1)(e), the Applicant (KWM) was entrusted with the administration and realisation of all or part of the Delong Companies’ assets located in Singapore.
• Investigatory Powers: The Applicant was authorised to take steps to investigate the affairs of the companies in Singapore, specifically including the transactions involving AMI SG, GNI SG, and the PT GNI receivables.
• Reporting Requirements: The Applicant was ordered to keep the Singapore Court apprised of any material changes in the PRC proceedings.

The Court’s final disposition was stated succinctly:

“In conclusion, I granted the applications in their entirety.” (at [44])

No order as to costs was recorded in the judgment, as the applications were unopposed and brought by the administrator for the benefit of the estate.

Why Does This Case Matter?

This decision is a landmark for practitioners involved in Singapore-China cross-border insolvency. It provides a clear roadmap for the recognition of PRC reorganisation proceedings, which are becoming increasingly common as Chinese enterprises with international footprints face restructuring. The judgment confirms that the PRC’s “reorganisation” (chongzhi) process fits squarely within the Model Law’s definition of a foreign proceeding, despite differences in terminology and procedural nuances.

The most significant doctrinal contribution is the confirmation that a law firm or professional body can serve as a “foreign representative.” In many common law jurisdictions, insolvency practitioners must be natural persons. However, the PRC and several civil law jurisdictions often appoint firms. By adopting a purposive and inclusive interpretation of “person or body” in Article 2(i), Aedit Abdullah J ensured that the Singapore Court remains “vessel-neutral” regarding the form of the foreign representative. This prevents a technicality from defeating the substantive goal of cross-border cooperation. Practitioners can now confidently file for recognition on behalf of institutional administrators without the need to appoint a nominal individual representative.

Furthermore, the case illustrates the power of the Model Law to assist in asset recovery. The specific facts involving the transfer of AMI SG for “nominal consideration” and the assignment of RMB 5 billion in receivables highlight the risks of asset dissipation in the lead-up to insolvency. By granting the administrator the power to “administer and realise” assets under Article 21, the Singapore Court provided the necessary teeth to the PRC reorganisation. This sends a strong signal that Singapore will not be a safe haven for assets transferred out of a foreign jurisdiction in a manner that prejudices the general body of creditors.

The decision also reinforces the robustness of the COMI presumption. Even in a complex group with 28 consolidated entities and significant international dealings (including in Indonesia and Singapore), the Court was willing to rely on the registered office presumption in the absence of compelling evidence to the contrary. This provides much-needed certainty and efficiency in the recognition process, reducing the need for exhaustive factual inquiries into the “nerve center” of the debtor unless the COMI is genuinely disputed.

Finally, the judgment situates Singapore as a leading hub for the UNCITRAL Model Law. By citing recent authorities like Ascentra Holdings and Fullerton Capital, the Court demonstrated a consistent and sophisticated application of international insolvency principles. This consistency is vital for international investors and creditors who require a predictable legal environment when dealing with distressed debt in Asia.

Practice Pointers

• Institutional Representatives: When applying for recognition of a foreign administrator that is a firm or partnership, explicitly reference Re King & Wood Mallesons and Genesis Asia Pacific to satisfy the Court that the Applicant qualifies as a “foreign representative” under Article 2(i).
• Expert Evidence: Ensure that affidavits from foreign law experts (like Mr. Jing Zhong in this case) clearly map the foreign proceeding to the five requirements in Ascentra Holdings. The affidavit should explain the degree of court supervision and the collective nature of the process.
• Consolidated Proceedings: If the foreign proceeding involves substantive consolidation of multiple entities, provide the Singapore Court with the specific foreign court order justifying the consolidation. The Singapore Court is generally receptive to consolidated reorganisations if they are sanctioned by the home court to protect creditor interests.
• Specific Relief for Investigations: If the goal is to investigate suspicious transactions (e.g., undervalue transfers or assignments of receivables), specifically request relief under Article 21(1)(e) and (g). Be prepared to provide prima facie evidence of the transactions, such as the “nominal consideration” transfer of AMI SG shares mentioned at [10].
• COMI Presumption: While the registered office presumption is the starting point, practitioners should proactively provide evidence of the location of management and the majority of creditors to forestall any potential rebuttal of the COMI.
• Public Policy: Address Article 6 briefly in the submissions, even if no opposition is expected. Emphasize that the foreign proceeding respects basic due process and creditor equality to satisfy the “manifestly contrary” threshold.

Subsequent Treatment

As a relatively recent decision from April 2025, Re King & Wood Mallesons builds upon the foundational principles established in Ascentra Holdings and Re Compuage Infocom Ltd [2025] SGHC 49. It is expected to be the leading authority for the recognition of PRC-based institutional administrators. The Court of Appeal’s decision in Re Fullerton Capital Ltd (in liquidation) [2025] SGCA 11, cited by the Court, further reinforces the high threshold for rebutting the COMI presumption and the limited scope of the public policy exception, aligning with the outcome here.

Legislation Referenced

• Insolvency, Restructuring and Dissolution Act 2018 (2020 Rev Ed), Section 252 and the Third Schedule (UNCITRAL Model Law on Cross-Border Insolvency)
• Companies Act (Cap 50, 2006 Rev Ed)
• PRC Enterprise Bankruptcy Law

Cases Cited

• Applied: Ascentra Holdings, Inc (in official liquidation) and others v SPGK Pte Ltd [2023] 2 SLR 421
• Followed: Re Genesis Asia Pte Ltd (in protection under the UNCITRAL Model Law on Cross-Border Insolvency) and another and other matters [2024] 4 SLR 570
• Considered: Re Compuage Infocom Ltd [2025] SGHC 49
• Considered: Re Fullerton Capital Ltd (in liquidation) [2025] SGCA 11
• Considered: Re Fullerton Capital Ltd (in liquidation) [2024] SGHC 155
• Referred to: United Overseas Bank Ltd v Loh Ah Peng Shane [2021] 2 SLR 950
• Referred to: Re Zetta Jet Pte Ltd and others [2019] 4 SLR 1343
• Referred to: British Steamship Protection and Indemnity Association Ltd and another v Thresh, Charles and another [2024] 2 SLR 317
• Referred to: Re Lion City Holdings Pte Ltd [2003] 3 SLR(R) 493
• Referred to: Celestial Nutrients Pte Ltd (in liquidation) v Sun (formerly known as Sun Airong) and another, interveners [2018] 3 SLR 687

Source Documents

• Original judgment PDF: Download (PDF, hosted on Legal Wires CDN)
• Official eLitigation record: View on elitigation.sg