Sanction Judgement – Amigo 2 Scheme
Following the sanction of the Amigo 2 scheme on 23 May 2022, please see the link to the sanction judgment of Trower J below. It follows the convening judgment of Snowden LJ on 15 March 2022.
The judgments are important and useful additions to the scheme case law. Key points considered and confirmed in the judgments include:
- the ability to promote parallel, alternative schemes in respect of the same company
- the convening of concurrent meetings to consider those schemes
- the analysis of cashflow insolvency in a run-off scenario in which the company benefits from an informal moratorium on redress claims
- scheme terms appropriate to maximise benefits for scheme creditors from future loan collections and a future equity raise
- scheme terms for a scheme ‘unwind’ so as not to prejudice scheme creditors relative to the administration comparator, if the schemes should fail post-sanction
- the appropriate form and content of an explanatory statement in a consumer redress scheme and its significance to the rationality test, which Trower J elegantly explained at [51-52] of his judgment
- the importance of an independent creditors committee, a customer advocate and constructive engagement with the FCA
Barry Isaacs QC and Adam Al-Attar are delighted to have been involved in this important and innovative case for the scheme company. Their thanks go out to the fantastic teams at Freshfields Bruckhaus Deringer LLP (Richard Tett, Christopher Robinson, Kevin Whibley, Kevin Connolly, Luke Fitzgerald and Lynette Ebo) and at PwC (Dan Schwarzmann and Nigel Rackham).