The Federal Court has recognised MF Global's ongoing insolvency proceedings in the United Kingdom. Under international insolvency law, this recognition means that MF Global's clients and others are barred from commencing legal proceedings in Australia against MF Global's Australian arm following the collapse of its parent last year.
MF Global and its Australian counterpart are currently engaged in negotiations over $34 million of funds currently held by the ASX which belongs to MF Global's clients. Both parties claim that this money belongs to their own clients and the ASX is refusing to release it until the matter is determined. In the event that the negotiations fail, MF Global Australia will need approval from the court to sue its parent company. The parties will reconvene in court next month to argue this point.