Singapore Court Grants Recognition to South African Insolvency Proceedings

Introduction

In Re Mirror Trading International (Pty) Ltd (in liquidation) and others [2026] SGHC 146, the General Division of the High Court (“Court“) granted recognition of a South African liquidation as a foreign main proceeding under the UNCITRAL Model Law on Cross-Border Insolvency (“Model Law“), and an order that the liquidators had standing to make applications to the Singapore courts for orders under or in connection with various forms of avoidance or clawback actions. The applicants were successfully represented by Sheila Ng and Jung Sangbum from Rajah & Tann Singapore.

Brief Facts

Mirror Trading International (Pty) Ltd (in liquidation) (“MTI“), a cryptocurrency trading platform, was incorporated in South Africa. Following findings that MTI was not licensed and was operated as a fraudulent Ponzi-like investment scheme, a run of withdrawals beset MTI. An application for compulsory liquidation was filed by an investor, which was granted under the South African Companies Act. A final liquidation order was made by the South African court, with various joint liquidators appointed. The liquidators pursued recognition of the South African liquidation in various jurisdictions. Twenty-nine potential defendants for various avoidance actions were identified in Singapore, with the possible claims amounting to about S$22 million or so. Recognition of the liquidation and relief were thus sought in Singapore.

Holding of the Court

 The Law on Recognition and Assistance

The Court set out the legislative framework laid down by section 252 and the Third Schedule of the Insolvency, Restructuring and Dissolution Act 2018 (“IRDA“), which implemented the Model Law:

1. Article 15: Under Article 15(1) of the Model Law, a foreign representative could apply to the court for recognition of the foreign proceeding in which the foreign representative had been appointed. Various procedural requirements were also specified. The specific issues pursuant to Article 15 included: (i) whether the South African liquidation was a foreign proceeding; (ii) whether the liquidators were foreign representatives appointed under the South African liquidation; and (iii) whether the procedural requirements under Article 15 have been satisfied.

2. Article 17: The next question was whether the foreign proceedings were foreign main proceedings, which would qualify for automatic reliefs. To so qualify, the foreign proceedings would have to be shown to have taken place in the centre of main interests (“COMI“) of the debtor, under Article 17(2)(a) of the Model Law. Following from this: (i) reliefs would be granted under Articles 20 and 21; (ii) the question of standing under Article 23 would also come into play; and (iii) the court would further consider if any public policy reasons existed against recognition and assistance.

Application for Recognition under Article 15 of the Model Law 

1. Foreign proceeding: On whether the South African liquidation qualified as a “foreign proceeding“, the Court held as follows: (i) the South African liquidation met the requirements for constituting a collective proceeding; (ii) the South African liquidation, which was commenced in and supervised by the South African court, met the requirement of constituting a judicial or administrative proceeding in a foreign state; and (iii) the other requirements for the South African liquidation to qualify as a foreign proceeding were fulfilled.

2.  Foreign representatives: The Court held that the liquidators fell within the definition of “foreign representative” appointed under the South African liquidation, being persons authorised in a foreign proceeding to administer the reorganisation or the liquidation of the debtor’s property or affairs or to act as a representative of the foreign proceeding. The liquidators were persons authorised in the South African liquidation to administer the liquidation of MTI, they were appointed pursuant to an order by the South African court, and their conduct was subject to the supervision of the Master of the High Court of South Africa.

3.  Other procedural requirements: The Court found that the various other procedural requirements under Article 15 of the Model Law were also met, including, among other things, the certification of the final liquidation order and the certification of the appointment of the liquidators.

Recognition as a Foreign Main Proceeding under Article 17 of the Model Law

The Court was satisfied that the COMI of MTI was South Africa, and accordingly, that the South African liquidation was a foreign main proceeding under the Model Law. As such, the Court granted recognition of the South African liquidation as a foreign main proceeding under Article 17(2)(a) of the Model Law. Following from this:

1. Automatic reliefs: The Court held that: (i) the stay and suspension of proceedings under Article 20(1) of the Model Law kicked in automatically; (ii) Article 21(1)(d) granted to the liquidators the power to examine witnesses, take evidence, and obtain delivery of information; and (iii) the application for specific orders against specific persons could be made by the liquidators at the appropriate juncture.

2. Singapore property: Further, the liquidators sought an order under Article 21(1)(e) of the Model Law allowing them to administer and release all or any part of MTI’s property located in Singapore. The Court granted this relief, subject to the requirement that no assets or proceeds thereof could be repatriated without the leave of court.

3. Avoidance actions: The liquidators also sought an order that they had standing to make applications to the Singapore courts under Article 23(1) of the Model Law for orders under or in connection with various forms of avoidance or clawback action under the IRDA and the Companies Act 1967. As recognition was granted in respect of the South African liquidation as a foreign main proceeding, the Court held that the liquidators satisfied the threshold requirement under Article 23(1) and accordingly granted the standing sought.

4. Public policy exception: The Court found that no issue of public policy arose in this case.

Concluding Words

 This decision sets out important and helpful guidance for the restructuring and insolvency community concerning the recognition of foreign liquidations as foreign main proceedings under the Model Law in Singapore, together with the reliefs granted following from such recognition.

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