Originally Posted by
Jonty
Are you sure your not confusing this with Chapter 11 bankruptcy protection?
All Chapter 15 does is say that this company is being restructured under different law in a different country and it protects Thomas cook from legal action in the US, saying all US investors have to take legal action in the UK. It defines the jurisdiction applicable to the restructuring. It’s got nothing to do with people being turned away at check in.
https://www.uscourts.gov/services-fo...kruptcy-basics
I'm definitely not confusing the differences between the different chapters of bankruptcy law in the US system, specifically Title 11, in which Chapter 11 and Chapter 15 both reside.
The Chapter 15 protection is for companies registered outside of the United States gaining protection from creditors within the United States exclusively. In this case it is being used as an instrument to attempt to block bondholders and potentially the hedge fund managers.
Cue tomorrow, where those said bondholders and hedge fund managers will be asking whether the company is effectively insolvent or not. If not what is its liquidity position.
The point where people get turned away from check-in desks wouldn't happen through these hearings directly. However, if the hearings tomorrow depict a perilous state of affairs for the company, the CAA will be taking note pending their decision on renewing the ATOL licence, as will suppliers hoping to get paid soon, and shareholders considering whether to cut-and-run on their positions.
FYI - a UK, or for that matter, EU registered company cannot file for Chapter 11 bankruptcy protection in the US. In the UK, Chapter 11 is called Administration.