Company's place of central administration important factor in determining its centre of main interests

A recent decision of the European Court of Justice (the ECJ) has clarified some important issues surrounding jurisdiction of EU Member States in relation to insolvency proceedings. In Interedil Srl (in liquidation) v Fallimento Interedil Srl and Intesa Gestione Crediti SpA [2011] EUECJ C-396/09, the ECJ provided guidance on the relevant criteria for determining the location of a debtor company's Centre of Main Interests (COMI), for the purpose of identifying which jurisdiction the relevant insolvency proceedings should be commenced.

The court held that Article 3(1) of Council Regulation No 1346/2000 must be interpreted in such a way that a debtor company’s COMI will be determined by attaching greater importance to the place of the company’s central administration, which may be established by objective factors which are ascertainable by third parties.

Despite being a European case, it is conceivable that this decision would be considered by an Australian court examining the same issues and Australian businesses dealing with international partners may also need to be aware of the EU position on the issue. Therefore, it is important for both practitioners and clients to have an understanding of where a company's central administration - that is, its centre of management and supervision - is located, as this will form the basis of the rebuttable presumption that the company's COMI and registered office are in the same location. Additionally, where a debtor company's registered office is transferred prior to the originating process of the insolvency proceedings being filed, its COMI will be presumed to be the place of the new registered office.