Re PT Garuda Indonesia (Persero) Tbk and another matter

The foreign representatives of PT Garuda Indonesia (Persero) Tbk (“the Company”) had brought an application under the Model Law, as it appears in the Insolvency, Restructuring and Dissolution Act 2018 (“the SG Model Law”), seeking the recognition of foreign proceedings in Indonesia and upon recognition, relief in terms of recognition and enforcement of a restructuring plan.

The non-parties did not dispute that the foreign proceeding in Indonesia was a foreign main proceeding but contended inter alia that recognition of the foreign proceeding in Indonesia would be contrary to the public policy of Singapore under Article 6 of the Third Schedule of the Insolvency, Restructuring and Dissolution Act 2018 (2020 Rev Ed) (“Article 6”).

The SICC held that Article 6 entailed a high threshold that had to be met before recognition would be refused. Examples of situations which would likely succeed under Article 6 include - where the relief sought under the Model Law is prohibited in the forum state or where compliance with orders for such reliefs would open individuals up to criminal prosecution or there is a failure to accord due process to the creditors and other relevant shareholders in the foreign insolvency process. The SICC found that the non-parties’ objections did not raise any concerns regarding due process rights but was targeted at the merits of the Indonesian court’s decision (which the court would not delve into).

The SICC also held that relief under the Third Schedule may extend to the recognition and enforcement of foreign insolvency orders. However, the proper basis for recognition and enforcement of a foreign insolvency order was the chapeau of Art 21(1) of the Third Schedule, rather than Art 21(1)(g) of the Third Schedule.

Read the full judgment here