The number of petitions filed in offshore jurisdictions has dropped by 10 percent in 2016.
Offshore law firm Appleby said the statistics reflect a continued leveling off since the high point of 2013, in its latest review of offshore petition filings and court orders in Bermuda, the British Virgin Islands, Cayman Islands, Guernsey, the Isle of Man and Mauritius.
The report examined compulsory winding up filings, applications to convert voluntary liquidations to court supervised liquidations and schemes of arrangement and capital reductions.
A total of 184 compulsory winding up petitions were filed during 2016, with the courts making 79 winding up orders. The conversion rate of winding up petitions into orders fell across the offshore jurisdictions, as more companies were able to successfully oppose petitions or reach consensual resolution.
“Although the number of petitions was down in 2016, numerous complex restructuring negotiations were under way during the year – particularly in the oil and gas sector – without having reached the point of petition filing,” said Tony Heaver-Wren, a dispute resolution partner in Appleby’s Cayman office.
“The general fall in petition filings in offshore jurisdictions recorded in 2016 to some degree reflects this movement toward restructuring over the course of the year and is expected to be reflected in the 2017 petitions profile.”
Some of the lowest numbers of filings occurred in the BVI and the Isle of Man where alternative processes to petitions exist for creditors or shareholders. Mauritius showed a disproportionately high number of filings, fueled by a significantly larger population and domestic economy.