Insights

• International investors and other claimants have long struggled to enforce cross-border claims in the United Arab Emirates (UAE) and the wider Middle East.
• Recent UAE courts decisions informing how they approach enforcement against debtors, including sovereigns, have signalled that the tides may be turning in creditors’ favor.
• As China looks to consolidate its new investment model for China-Middle East collaboration, this issue may particularly impact PRC-based investors with an eye on the region.

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• Economic ties between Latin American and Chinese businesses continue to deepen. There are unique risks involved if a dispute arises with the Chinese company.
• Even if an organization or investor succeeds in an arbitration or litigation against a Chinese company, the Chinese legal system’s intricacies may create barriers to getting the company to pay.
• Latin American companies and investors should consider cross-border strategies to increase their leverage.

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• In South Korea, family struggles and key shareholder disputes over control of conglomerates, or chaebols, have long posed risks to minority shareholder interests.
• As the chief of South Korea’s Financial Supervisory Service raises concerns over a bid to take over Korea Zinc, many are preparing for impact on shareholder value. 
• Global investors, including activist funds, should consider deploying creative strategies to maximize their positions.

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• On October 22, England’s Court of Appeal dismissed the Kingdom of Spain’s challenge to enforce a US $109 million arbitral award in favor of Kobre & Kim’s client.
• Despite Spain’s arguments asserting state immunity, Lord Justice Phillips interpreted the 1965 ICSID Convention.

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• A Kobre & Kim client received a recent ruling by the New York Supreme Court that eases global bondholders’ ability to monetize claims.
• Justice Joel Cohen found Zhu Xinli, the sole director of Huiyuan Juice subsidiary Huiyuan Beijing, personally liable for more than US $114 million. 
• The decision means that bondholders increasingly have monetization options against recalcitrant debtors, including the ability to collect at par from well-heeled decision-makers when the primary obligors may be effectively insolvent, judgment-proof, or even already in bankruptcy proceedings.

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• Propel Fuels, Inc. (“Propel”), a low-carbon fuel provider, was awarded victory by a jury in its trade secrets misappropriation case against Phillips 66 Company (“Phillips 66”). 
• On October 16, 2024, the jury found that Phillips 66’s renewable fuels business was developed using Propel’s trade secrets in violation of California’s Uniform Trade Secrets Act and awarded unjust enrichment damages totaling US $604.9 million.
• The jury also found Phillips 66’s misappropriation willful and malicious, meaning the Court may triple the total damages award.

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• When large-scale cryptocurrency fraud or cyber-attacks hit, the stolen assets can quickly be dispersed across the globe, with perpetrators hard to find. In these cases, the initial hours and days can be critical.
• However, a recent victory shows that even after considerable time has passed since a hack, victims can trace stolen assets and react quickly to recover them due to the public nature of blockchain transactions and the powers of the English and US Courts to order injunctive relief.

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• As geopolitical tensions pressure sovereign debt, more investors are taking their disputes against sovereign states and entities to arbitration and judicial forums. There is a world of difference between demanding payment of a defaulted debt, judgment, or award from a sovereign and seeing the sovereign pay up.
• Meanwhile, Chinese private investors have become more prominent in sovereign-related investments through acquisitions, joint ventures, and infrastructure projects in Europe, Africa and Latin America.
• Investors and other claimants should not be afraid to stand up to sovereign debtors with aggressive non-traditional strategies.

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• As high energy prices and a wider global weakening economy threaten the shipping and maritime industries, many Cyprus-based companies face serious financial distress.
• This poses a risk for creditors or those with deep financial ties to those companies as they increasingly default on their bonds and bilateral loans.
• Creditors of Cypriot companies in those situations should focus on a multijurisdictional approach to achieve recovery.

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• The private cell phones of employees in high-stakes internal investigations can put key stakeholder relationships at risk, posing a serious challenge for general counsel or law firms unwilling to “burn a bridge” with a client or other external stakeholder.
• In these complex situations, an independent, “one-off” third party uninterested in pursuing institutional relationships can be critical in delivering an unbiased, confidential assessment.
• Companies should seek to limit liability by taking a few preventive measures to avoid serious risks associated with investigations.

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• Western enforcement agencies like the U.S. Department of Justice (DOJ) increasingly pursue Ultra-High-Net-Worth Individuals (UHNWIs) with cross-border investigations throughout Africa.
• These investigations threaten the UHNWIs' liberty, assets, and reputation and are often initiated solely based on allegations made in the media by adversaries.
• The increased focus of the U.S. DOJ and the aggressive tools at its disposal can put individuals and companies operating throughout Africa at risk of global asset freezes, seizures, and/or other penalties.

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• Delaware’s strong asset protection laws have long made the U.S. state a destination of choice for individuals and entities worldwide looking to set up a trust.
• International creditors looking to recover assets may feel that pursuing a debtor in Delaware is insurmountable.
• However, it is indeed possible to crack Delaware’s notoriously tough trusts by adopting an aggressive multijurisdictional strategy.

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• Commercial parties worldwide have long struggled to enforce cross-border arbitration awards and judgments in the Middle East.
• However, recent decisions of the UAE courts have signaled that the tides may be turning more in creditors’ favor. which can inform how they may approach enforcement against a sovereign debtor.
• Our team explains recent updates advancing cross-border judgment enforcement efforts in the region.

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