Guernsey is a British Crown dependency with its own legislature and independent legal system. Much of the insolvency regime is based on modern and adaptable insolvent and solvent winding-up processes which will be familiar to English and other common law practitioners.
Companies (Guernsey) Law, 2008 (the Companies Law) is the principal legislation governing liquidation, administration and schemes of arrangement in respect of Guernsey companies (including protected cell companies and incorporated cell companies and their incorporated cells). It also provides for compulsory winding up of foreign companies.
Insolvency Rules contained in the Companies (Guernsey) (Insolvency Rules) Regulations, 2022 (the Insolvency Rules) and the Company Insolvency Rules (Application To Disclaim Onerous Property) Rules, 2023 (the Onerous Property Rules) provide more detail about certain aspects of Guernsey corporate insolvency procedures.
The Limited Partnerships (Guernsey) Law, 1995 (the Limited Partnerships Law) and the Limited Liability Partnerships (Guernsey) Law, 2013 (the Limited Liability Partnerships Law) govern how limited partnerships and limited liability partnerships respectively are wound up in insolvent circumstances.
Section 426 of the Insolvency Act 1986 extends to Guernsey by virtue of the Insolvency Act 1986 (Guernsey) Order, 1989 (the Insolvency Act Order), allowing the courts in Guernsey, the UK, Isle of Man and Jersey to provide reciprocal judicial assistance in insolvency matters.
The Judgments (Reciprocal Enforcement) (Guernsey) Law, 1957 (the Reciprocal Enforcement Law) provides that money judgments emanating from the superior courts of England and Wales, Scotland, Northern Ireland, Jersey, Isle of Man, Israel, Italy, Netherlands and Suriname are (subject to certain conditions) recognised and enforceable in Guernsey. The Reciprocal Enforcement Law co-exists alongside a customary law recognition and enforcement regime.
We are grateful to Abel LYALL and Iona MITCHELL from Mourant for sharing this relevant information.
Update: April 2024
NB: Please note older forms of Guernsey insolvency proceeding exist but are rare, unlikely to be encountered in an international context and are, therefore, not covered here.