The Meaning of ‘Economic Activity’ and ‘Establishment’ in Cross-border Insolvency Proceedings – The Implications of Olympic Airlines SA case

Wood, John Michael (2015) The Meaning of ‘Economic Activity’ and ‘Establishment’ in Cross-border Insolvency Proceedings – The Implications of Olympic Airlines SA case. International Company and Commercial Law Review, 9. pp. 302-306. ISSN 0958-5214

Abstract

The focus here is on “the place”, which will be defined as the “establishment”, and “interests on a regular basis”, which will be defined as “economic activity”. The importance of these terms has recently been discussed by the Supreme Court in the case of Trustees of the Olympic Airlines SA Pension and Life Insurance Scheme v Olympic Airlines. In this case Lord Sumption gave the main judgment (with whom Lord Neuberger, Lord Mance, Lord Reed and Lord Toulson agreed). The issue that the court had to determine was, if a company’s COMI is in another Member State of the EU, what connection a foreign company must have with the UK to entitle an English court to wind it up. The implications of this ruling have the potential to have a serious impact on cross-border insolvency, the main aspects of which will now be examined.