"COMI Tourism" Alone Does Not Preclude Chapter 15 Enforcement of a UK Part 26A Restructuring Plan Containing Non-Debtor Releases and Exculpations
The Decision
In In re NFE Global Holdings Limited, 2026 WL 2032660 (Bankr. S.D.N.Y. July 14, 2026), the U.S. Bankruptcy Court for the Southern District of New York recognized as foreign main proceedings two English proceedings under Part 26A of the Companies Act 2006 ("Part 26A") and enforced the English court-sanctioned restructuring plans, including non-debtor releases and exculpations. The court held that the fact that a U.S.-based corporate group used UK affiliates as plan companies—so-called "COMI tourism"—did not, standing alone, justify denying recognition or enforcement.
Practical Takeaway
The decision does not create a safe harbor for forum shopping. It underscores that a chapter 15 court must independently examine the statutory recognition requirements and, before granting discretionary plan-enforcement relief, consider whether creditors and other interested entities are sufficiently protected under section 1522(a) of the Bankruptcy Code and whether the relief is manifestly contrary to U.S. public policy under section 1506. In NFE Global, the court emphasized the absence of objections, extensive notice and opportunities to be heard, overwhelming creditor support, and the value-preserving nature of the restructuring. NFE Global, 2026 WL 2032660, at *21, *23–26.
Chapter 15 Recognition and Related Relief
Chapter 15, enacted in 2005 and patterned on the UNCITRAL Model Law on Cross-Border Insolvency, provides a framework for recognizing qualifying foreign proceedings and granting related relief in the United States. Its central policy is international comity, subject to statutory protections for creditors and other interested entities. See Morning Mist Holdings Ltd. v. Krys (In re Fairfield Sentry Ltd.), 714 F.3d 127, 132 (2d Cir. 2013); Hilton v. Guyot, 159 U.S. 113, 164 (1895).
Section 1515 permits a foreign representative to petition a U.S. bankruptcy court for recognition of a "foreign proceeding." Section 101(24) defines "foreign representative" as a person or body authorized in the foreign proceeding to administer the debtor's reorganization or liquidation or to act as its representative. 11 U.S.C. § 101(24).
Section 101(23) defines a "foreign proceeding" as "a collective judicial or administrative proceeding in a foreign country, including an interim proceeding, under a law relating to insolvency or adjustment of debt in which proceeding the assets and affairs of the debtor are subject to control or supervision by a foreign court, for the purpose of reorganization or liquidation." 11 U.S.C. § 101(23).
Recognition distinguishes a foreign "main" proceeding—pending in the country where the debtor's center of main interests ("COMI") is located—from a "nonmain" proceeding, which may be recognized where the debtor has an "establishment." See 11 U.S.C. §§ 1502(2), (4)–(5), 1516(c). The Bankruptcy Code presumes that the debtor's registered office is its COMI; an establishment is "any place of operations where the debtor carries out a nontransitory economic activity." Id.
Courts assess COMI using nonexclusive factors including the debtor's headquarters, management, primary assets, affected creditors, and the law governing most disputes. See Morning Mist Holdings Ltd. v. Krys (In re Fairfield Sentry Ltd.), 714 F.3d at 137 (citing In re SPhinX, Ltd., 351 B.R. 103, 117 (Bankr. S.D.N.Y. 2006)). Courts also consider the location from which the debtor's activities are directed and controlled, the regularity and ascertainability of that location, and creditor expectations. See Fairfield Sentry, 714 F.3d at 138; In re Serviços de Petróleo Constellation S.A., 600 B.R. 237, 274 (Bankr. S.D.N.Y. 2019); In re Oi Brasil Holdings Coöperatief U.A., 578 B.R. 169, 222, 228 (Bankr. S.D.N.Y. 2017); In re British Am. Ins. Co., 425 B.R. 884, 912 (Bankr. S.D. Fla. 2010).
COMI may shift before the chapter 15 filing, but courts require evidence of a genuine change rather than minimal pre-filing activity. See In re Pirogova, 593 B.R. at 410; see also In re Creative Fin. Ltd., 543 B.R. at 519. Under Fairfield Sentry, the relevant time for assessing COMI is the chapter 15 petition date, although the court may examine the period between commencement of the foreign proceeding and filing of the chapter 15 petition for bad-faith manipulation. 714 F.3d at 137–38.
Recent cases addressing this issue emphasize that a newly formed foreign affiliate does not automatically establish a permissible route to chapter 15 relief. In In re Mega Newco, Ltd., 2025 WL 601463, at **3–4 (Bankr. S.D.N.Y. Feb. 24, 2025), the court recognized a UK scheme after finding no serious question that the structure was unfair or thwarted creditor expectations. The court nevertheless cautioned that the structure could be abused if used to favor insiders or defeat creditors' legitimate expectations.
Following recognition, sections 1520 and 1521 govern relief. Recognition of a foreign main proceeding triggers specified protections under section 1520; section 1521(a) authorizes discretionary relief, including "any appropriate relief" necessary to effectuate chapter 15 and protect the debtor's assets or creditors' interests.
Section 1522(a) permits discretionary relief under sections 1519 or 1521 only if creditors and other interested entities, including the debtor, are sufficiently protected. Courts generally assess three related principles: just treatment of creditors; protection of U.S. claimants from prejudice and inconvenience in the foreign proceeding; and distribution substantially in accordance with the priorities prescribed by U.S. law. See In re Markus, 610 B.R. 64, 76 (Bankr. S.D.N.Y. 2019), aff'd, 620 B.R. 31 (S.D.N.Y. 2020); In re Atlas Shipping A/S, 404 B.R. 726, 740 (Bankr. S.D.N.Y. 2009). A foreign plan provision that expressly conflicts with applicable U.S. protections may therefore preclude discretionary relief. See Jaffe v. Samsung Electronics Co., 737 F.3d 14, 30–31 (4th Cir. 2013) (applying sections 1522(a) and 365(n)).
Section 1507(a) separately authorizes "additional assistance" consistent with comity and the fairness considerations in section 1507(b), including fair treatment of stakeholders, protection of U.S. creditors, prevention of preferential or fraudulent transfers, and distributions substantially in accordance with the order prescribed by the Bankruptcy Code. See 11 U.S.C. § 1507(b).
Section 1506 supplies a narrow public-policy exception: A court may refuse an action governed by chapter 15 only if it would be "manifestly contrary to the public policy of the United States." The Second Circuit has described this as an exacting standard, and the Third Circuit has likewise limited it to exceptional circumstances involving matters of fundamental importance to the United States. See In re Fairfield Sentry Ltd., 714 F.3d 127, 139 (2d Cir. 2013); accord In re ABC Learning Ctrs. Ltd., 728 F.3d 301, 309 (3d Cir. 2013).
Foreign law need not mirror U.S. law; comity requires a comparable result and laws that are not repugnant to U.S. law and policy. See In re Platinum Partners Value Arbitrage Fund L.P., 583 B.R. 803, 815 (Bankr. S.D.N.Y. 2018).
Chapter 11 Context: Non-Debtor Releases and Exculpations
Section 524(e) generally provides that a debtor's discharge does not affect the liability of another entity on the same debt. Nevertheless, chapter 11 plans may address consensual releases and exculpations for estate fiduciaries and other participants in court-supervised restructurings.
In Harrington v. Purdue Pharma L.P., 603 U.S. 204, 206 (2024), the U.S. Supreme Court held that, outside section 524(g), the Bankruptcy Code does not authorize a chapter 11 plan to release or enjoin claims of nonconsenting creditors against a non-debtor where the claims are effectively discharged. The Court did not decide what constitutes consent or disturb consensual releases, and it limited the holding to the statutory authority available in chapter 11.
Exculpations are distinct from releases: they generally protect estate fiduciaries and other participants from liability for conduct in the bankruptcy case, subject to limitations such as gross negligence and willful misconduct. Courts in the Second Circuit have permitted properly tailored exculpations for court-supervised conduct. See In re LATAM Airlines Grp. S.A., 2022 WL 2206829, at *49–50 (Bankr. S.D.N.Y. June 18, 2022); In re Aegean Marine Petroleum Network Inc., 599 B.R. 717, 720–21 (Bankr. S.D.N.Y. 2019); In re Klaynberg, 2023 WL 5426748, at *17–18 (Bankr. S.D.N.Y. Aug. 22, 2023).
Chapter 15 Enforcement of Non-Debtor Releases and Exculpations
Chapter 15 does not require a U.S. court to confirm the foreign plan as if it were a chapter 11 plan. Instead, after recognizing the foreign proceeding, the court may enforce a foreign court-sanctioned plan or order under sections 1521 and 1507, subject to section 1522(a)'s sufficient-protection requirement and section 1506's public-policy exception. The question is therefore not simply whether the relief would be available in a plenary chapter 11 case, but whether enforcement is appropriate in the cross-border case before the court.
In In re Metcalfe & Mansfield Alternative Investments, 421 B.R. 685, 696 (Bankr. S.D.N.Y. 2010), the court enforced a Canadian court's order containing non-debtor releases and injunctions, reasoning that comity and the principles governing enforcement of foreign judgments supported enforcement even if the relief might not have been available in a plenary chapter 11 case.
In Vitro S.A.B. de C.V. v. ACP Master, Ltd. (In re Vitro S.A.B. de C.V.), 473 B.R. 117 (Bankr. N.D. Tex. 2012), aff'd, 701 F.3d 1031 (5th Cir. 2012), the Fifth Circuit held that section 1507 could authorize relief unavailable under chapter 11, but affirmed refusal to enforce nonconsensual releases where creditors had no meaningful alternative recovery, recoveries were minimal, and insider votes dominated support.
In In re Avanti Commc'ns Grp. PLC, 582 B.R. 603, 615–19 (Bankr. S.D.N.Y. 2018), the court enforced an English scheme containing nonconsensual third-party releases after finding due process, creditor support, the common use of affiliate-guarantee releases under English law, and prejudice if the scheme were not enforced. In In re Agrokor d.d., 591 B.R. 163, 188–89 (Bankr. S.D.N.Y. 2018), the court similarly enforced a creditor-approved Croatian settlement containing a third-party release, emphasizing support above the statutory threshold and the exclusion of insider votes.
In In re PT Bakrie Telecom TBK, 628 B.R. 859, 871 (Bankr. S.D.N.Y. 2021), by contrast, the court refused to enforce a plan containing third-party releases because the record did not explain their justification or show that the foreign court had considered creditors' rights in approving them.
In In re Odebrecht Engenharia e Construção S.A., 669 B.R. 457 (Bankr. S.D.N.Y. 2025), the court held that section 1521 authorizes nonconsensual third-party releases in chapter 15 and that section 1506 does not bar them, while also concluding that enforcing a release in a foreign plan is not materially different from including release language in a recognition order. The decision reflects a broader view of chapter 15's enforcement authority than the more limited approach in Altice France, in which, by contrast, the court refused to add release language not contained in a French "sauvegarde" plan, stating that chapter 15 courts should enforce the foreign plan, not add to it. In re Altice France S.A., No. 25-11349 (Bankr. S.D.N.Y. Sept. 30, 2025).
In U.S. Int'l Dev. Fin. Corp. v. Crédito Real S.A.B. de C.V., SOFOM, E.N.R. (In re Crédito Real S.A.B. de C.V.), 677 B.R. 192 (D. Del. 2026), appeal filed, No. 26-2356 (3d Cir. June 5, 2026), the district court affirmed enforcement of Mexican nonconsensual third-party releases, reasoning that chapter 15 permits U.S. courts to give effect to foreign orders containing relief unavailable under U.S. law.
NFE Global: Recognition and Enforcement of Part 26A Plans
New Fortress Energy Inc. ("NFE"), a Delaware corporation with stock listed on Nasdaq, is the ultimate parent of a group (the "group") that owns and operates natural gas and liquefied natural gas infrastructure and an integrated fleet of ships. NFE's direct and indirect subsidiaries include NFE Global Holdings Limited ("NFE Global") and NFE Brazil Newco Limited ("NFE Brazil" and, together with NFE Global, the "debtors"), both private companies incorporated under the laws of England and Wales.
NFE Global was incorporated in 2021; NFE Brazil was incorporated in April 2026 specifically to promote the restructuring of the group's Brazilian operations. Each debtor had its registered office, books and records, and a bank account in England; Vistra Cosec Limited served as corporate secretary for both, and Christopher Boas, a UK resident, served as a director of each. The debtors also had an interest in an attorney retainer held in a New York account and were obligors or guarantors on U.S.-dollar debt governed by New York law
On March 17, 2026, NFE, NFE Global, other group entities, and major creditor groups entered into a restructuring support agreement (the "RSA") after months of negotiations. NFE Brazil acceded to the RSA on April 9. The RSA addressed approximately $5.7 billion of funded debt and was supported by 100% of the revolving credit facility and Term Loan A lenders, approximately 97% of Term Loan B lenders, 85% of 2026 Legacy Noteholders, 87% of 2029 Legacy Noteholders, and 99% of New 2029 Noteholders.
The proposed restructuring would reduce the group's funded debt owed to creditors outside the group from approximately $5.7 billion to less than $1 billion, exchange existing debt for new debt and preferred and common equity, and separate the group into two independent companies. BrazilCo would hold the Brazilian operations and certain other assets and be owned by certain creditors; CoreCo would hold the remaining operations, with creditors owning 65% and existing NFE shareholders retaining 35% before dilution from the management incentive plan and preferred equity conversions.
On March 24 and April 10, 2026, NFE Global and NFE Brazil, respectively, commenced proceedings in England under Part 26A of the Companies Act 2006 to implement the restructuring plans.
The Part 26A plans (each, a "plan") contained releases (the "plan releases") of group entities and related parties from claims arising out of or related to the debt being restructured (the "plan debt"), together with exculpation for acts taken in connection with negotiating, preparing, sanctioning, or implementing the plans and restructuring. The releases and exculpations included carve-outs for, among other things, criminal acts, fraud, gross negligence, willful misconduct, certain professional-adviser liabilities, and post-effective-date conduct. Under English law, the plan releases bound both assenting and dissenting creditors.
On May 28, 2026—before creditor voting and the English sanction hearing—the debtors' court-approved foreign representative filed chapter 15 petitions in the U.S. Bankruptcy Court for the Southern District of New York seeking recognition of the English proceedings and related relief, including later enforcement of the plans and the plan releases. Recognition was a condition precedent to effectiveness of the restructuring, and failure to obtain it was a termination event under the RSA.
At plan meetings on June 15, 2026, creditors approved the plans with near-unanimous support: Six of seven classes voted unanimously in favor, and the remaining class approved by 99.84% of votes cast by value. Only one plan creditor, holding less than 0.1% of the total plan debt, voted against one plan. The record reflected extensive notice and multiple opportunities to review and object to the plans and plan releases.
On June 18, 2026, the English court sanctioned the Part 26A restructuring plans (the "sanction order").
No party objected to the chapter 15 relief. The bankruptcy court entered a bench order granting recognition and related relief on June 29, 2026, followed by a written opinion on July 14, 2026.
Recognition of the English Proceedings
Chief U.S. Bankruptcy Judge Martin Glenn framed the issue as whether "COMI tourism"—the use of a foreign affiliate established to pursue a foreign restructuring solution followed by chapter 15—automatically defeats recognition and enforcement. He held that chapter 15 contains no categorical bar, but cautioned that a court must examine whether the structure circumvents the Bankruptcy Code to disadvantage creditors. NFE Global, 2026 WL 2032660, at *1, *22.
The court warned that using a UK debtor to file under Part 26A could circumvent the requirements of the U.S. Bankruptcy Code to disadvantage some creditors. The concern, however, was not dispositive: The court treated the risk of manipulation as a fact-specific inquiry informed by creditor expectations and the record before it.
The court first found the debtors eligible to be chapter 15 debtors under section 109(a). The New York retainer and the debtors' contractual rights under U.S.-dollar debt instruments governed by New York law and containing New York forum-selection clauses constituted property in the United States. See NFE Global, 2026 WL 2032660, at *18–19.
The court then recognized the English proceedings as "foreign proceedings" under sections 101(23) and 1517(a)(1) and as foreign main proceedings under sections 1502(4) and 1517(b)(1). The proceedings were court-supervised, collective, and conducted under Part 26A for the purpose of restructuring the group's debt. England was the debtors' COMI because both were English companies with English registered offices, books and records, bank accounts, a UK corporate secretary, and an English director who served as foreign representative. NFE Global, 2026 WL 2032660, at *20.
The court also held that section 1506 did not bar recognition. Creditors had notice and an opportunity to be heard, the restructuring followed lengthy negotiations and received overwhelming support, and no party objected. These circumstances supported the court's conclusion that the English proceedings were fundamentally fair and consistent with U.S. due process. Id. at *21, *26.
Addressing COMI manipulation, the court examined the circumstances surrounding the debtors' formation and the English proceedings and found no evidence of exploitation or untoward manipulation that warranted denying recognition or enforcement. The court treated creditor acquiescence and support as important evidence that the structure had not thwarted creditor expectations, while making clear that the analysis would be fact-specific. Id. at *23.
Enforcement of the Part 26A Plans
The court separately addressed enforcement of the plans and plan releases. It noted that Part 26 and Part 26A plans commonly release affiliate guarantees of restructured debt and that, without those releases, a plan could fail because creditors might pursue "ricochet" claims against guarantors. Id. at *17.
Relying on section 1521(a)'s authorization of "any appropriate relief," the court held that enforcing the sanction order, the plans, the plan releases, and the exculpations was necessary to effectuate chapter 15 and protect the debtors' assets and creditor interests. The court emphasized that chapter 15 enforcement is discretionary, not an automatic consequence of recognition. Id. at *24.
Section 1522(a) supplied the guardrail. The court found creditors sufficiently protected because the plans resulted from months-long negotiations with sophisticated, well-informed creditors; creditors received extensive notice and opportunities to be heard; no party objected; and the restructuring was projected to produce better recoveries than the relevant alternative. The court also found the releases and exculpations necessary to implement the restructuring and beneficial to creditors. Id. at *24–25.
The court also found enforcement appropriate under section 1507 for substantially the same reasons, including the absence of evidence of preferential or fraudulent disposition. It concluded that enforcement of the plans, the plan releases, and the exculpations was not manifestly contrary to U.S. public policy. Id. at *26.
Practical Implications
Part 26A may offer a U.S.-based group a restructuring route for selected tranches of debt, including through cross-class cramdown, without placing the entire enterprise into chapter 11. But NFE Global should not be read as approving COMI tourism categorically.
The court's reasoning turns on case-specific facts. Indeed, Part 26A's sufficient-connection jurisdictional test is not a substitute for the COMI analysis for chapter 15 purposes. A foreign affiliate's incorporation, UK records and bank account, and other local indicia supported COMI in NFE Global, but the court also scrutinized whether creditor expectations were thwarted and whether proper notice and process were provided. Further, it considered creditor support and recoveries, and the absence of objections.
Future cases will require careful attention to the distinction between recognition and enforcement. Recognition is not discretionary and will turn on satisfying the requirements of section 1517, including a qualifying foreign proceeding, a foreign representative, and a petition satisfying section 1515. Enforcement of a sanctioned Part 26A plan is discretionary and requires sufficient protection under section 1522(a), satisfaction of section 1507(b)'s fairness considerations, and compliance with section 1506's public-policy limitation.
NFE Global's practical lesson is narrow but important: Creditor consent and a value-preserving restructuring can support recognition and enforcement even when a UK affiliate was formed to pursue the Part 26A process. None of this, however, eliminates the need for an independent, fact-specific review by a chapter 15 court before recognizing a foreign restructuring. Significant creditor objections, evidence of insider exploitation, or a plan provision that conflicts with U.S. law could produce a different result.
At bottom, court-supervised restructurings—in any jurisdiction around the world—inherently involve the impairment of creditor's rights and likely thwart some creditor expectations. Nevertheless, when a foreign restructuring court adjudicates the restructuring (assuming proper jurisdictional connection) and sanctions the plan (assuming the voting thresholds and legal standards are appropriately satisfied), a chapter 15 court should not attempt to "superimpose requirements of U.S. law" nor "second-guess" the foreign court's determinations regarding whether restructuring under the laws of their home jurisdiction is appropriate. In re Rede Energia S.A., 515 B.R. 69, 100 (Bankr. S.D.N.Y. 2014).
As capital continues to flow throughout the world, lenders and borrowers will continue to have broader access to restructuring toolkits, and it will be important for U.S. courts to provide comity to facilitate holistic restructurings.
