Oi bondholder committee appeals Dutch case recognition denial ruling

By Caroline Salls

Pittsburgh, Jan. 10 – An Oi SA international bondholder committee appealed an order denying a motion filed by Oi Brasil Holdings Coöperatief UA’s foreign representative seeking recognition of the company’s Dutch bankruptcy case as a foreign main proceeding, according to a notice filed with the U.S. Bankruptcy Court for the Southern District of New York.

As previously reported, several Oi Group entities, including Oi Brasil Holdings Coöperatief (Coop), were granted U.S. recognition of Brazilian bankruptcy proceedings in July 2016.

“As a basis for that recognition, the court found Coop’s center of main interests to be in Brazil given Coop’s status as a special purpose financing vehicle for the Oi Group,” judge Sean H. Lane said in the opinion denying recognition.

Around the same time that the Brazilian case was recognized, Lane said a number of Coop’s creditors began to take action against it in the Netherlands, ultimately leading to the Dutch bankruptcy proceeding.

Arguing that Coop’s center of main interests are in the Netherlands, Lane said Coop’s representative sought recognition of the Dutch case and an order overturning the previous recognition of Coop’s Brazilian bankruptcy.

According to the opinion, Coop’s request to modify or terminate the previous recognition was denied because the evidence relied upon by the court in its Brazilian recognition order “justified its finding that Coop’s COMI was in Brazil.”

“At the prior recognition hearing this court was well aware that Coop’s registered office was in the Netherlands,” Lane said in his opinion. “But the registered office presumption is not accorded the same weight under U.S. law.”

Oi is a Rio de Janeiro-based telecommunications service provider. It filed for Chapter 15 bankruptcy on June 21, 2016 under case number 16-11791.

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