India's Corporate Insolvency Resolution Process recognised in Singapore for the first time

What you need to know

• The Singapore High Court has recognised India's Corporate Insolvency Resolution Process ("CIRP") for the first time under the UNCITRAL Model Law on Cross-Border Insolvency, as adopted in Singapore.
• The decision also recognised India's National Company Law Tribunal ("NCLT") as a "foreign court". The Singapore High Court's decision opens the door to Singapore potentially recognising other Indian-law restructuring and insolvency procedures, including Indian schemes of arrangement and liquidation.
• Singapore is one of the first jurisdictions to recognise the CIRP. 
• Given the significance of cross-border trade and economic ties between India and Singapore, this notable decision provides further certainty with regard to the recognition and effectiveness of cross-border restructurings and insolvency proceedings involving corporate groups from India and Singapore.

The recent judgement by the Singapore High Court in Re Compuage Infocom Limited [2025] SGHC 49 ("Re Compuage Infocom") recognised the NCLT of India as a "foreign court" and the CIRP as a "foreign proceeding" for the purposes of the UNCITRAL Model Law on Cross-Border Insolvency, as adopted in Singapore (the "Model Law"). 

In setting out the grounds of his decision, Justice Aidan Xu @ Aedit Abdullah considered the role and function of the NCLT and CIRP in light of the requirements under the Model Law to be considered a "foreign court" and a "foreign proceeding", respectively.

The NCLT is a "foreign court" for the purposes of the Model Law

The court noted that the NCLT is a "quasi-judicial body" and not a court on the basis that it comprises not only members of the judiciary, but also technical members with backgrounds in accountancy and corporate turnaround and insolvency. 

However, its quasi-judicial nature did not prevent it from being recognised as a "foreign court", as the definition of "foreign court" in the Model Law is "deliberately expansive" so as to encompass both judicial and non-judicial (or administrative) authorities.

Furthermore, it was established that the NCLT exercised the requisite judicial (and not merely administrative) powers in relation to controlling or supervising a CIRP.

Accordingly, the court held that the NCLT falls within the definition of "foreign court" for the purposes of the Model Law.

The recognition of the NCLT as a "foreign court" for the purposes of the Model Law is significant as it provides a basis for other Indian-law restructuring and insolvency processes, such as schemes of arrangement (under India's Companies Act) and liquidation (under India's Insolvency and Bankruptcy Code 2016 ("IBC") and Companies Act), which are also supervised by the NCLT, to be recognised in the future by Singapore. 

In determining whether the CIRP constituted a "foreign proceeding", the court noted the five requirements set out by the Singapore Court of Appeal in Ascentra Holdings, Inc (in official liquidation) and others v SPGK Pte Ltd [2023] 2 SLR 421 ("Ascentra Holdings") for a proceeding to qualify as a "foreign proceeding" under the Model Law, being:

a) the proceeding must be collective in nature;
b) the proceeding must be a judicial or administrative proceeding in a foreign State;
c) the proceeding must be conducted under a law relating to insolvency or adjustment of debt;
d) the property and affairs of the debtor company must be subject to control or supervision by a foreign court in that proceeding; and
e) that proceeding must be for the purpose of reorganisation or liquidation.

Applying the five requirements of Ascentra Holdings, the court found that:

• The CIRP's primary objective is "to facilitate the implementation of a resolution plan that provides for the treatment of the claims of all creditors and the revival of [the debtor company]". It was determined that the CIRP deals with (i) the claims of all creditors of the debtor company and (ii) all of the assets of the debtor under the protection of a statutory moratorium. For this reason, the CIRP could be considered a "collective proceeding".
• On the basis that it had been established that the NCLT was a "foreign court" which exercised the requisite level of supervision over the CIRP, it followed that the CIRP constituted a judicial or administrative proceeding in a foreign State.
• The CIRP, which is governed under the IBC, is a process conducted under a law relating to insolvency or adjustment of debt. 
• The NCLT exercised the requisite control or supervision over the resolution professional (the "RP") appointed to conduct a CIRP with respect to a debtor company. The role of the RP includes taking control of and managing the affairs of the debtor company as well as preserving and protecting its assets. 
• As provided for by the IBC, the purpose of the CIRP is to provide a mechanism for corporate reorganisation.
  

The RP in Re Compuage Infocom also sought relief under Article 21(1)(e) of the Model Law to repatriate certain assets of the debtor (including cash in bank accounts, bank books and records) to India to form part of the estate of the debtor company being managed by the RP under the CIRP.

The court declined to grant this additional relief at this stage of the proceedings to ensure that any local creditors are given adequate opportunity to voice their objections, commenting that such a position was "within the spirit of modified universalism."

However, the court went on to note that this was not a final refusal to grant relief and that "[i]f it is shown that local creditors will be treated fairly and will be given ample opportunity to participate in the process abroad, I would think there would rarely be any reason to refuse repatriation or remittal of funds out of Singapore."