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Global rules on foreign direct investment (FDI)
Cross-border acquisitions and investments increasingly trigger foreign direct investment (FDI) screening requirements.
Canada | Publication | May 12, 2020 – 5 PM ET
Remember, first and foremost, to consult the commercial lease to identify the clause that governs this situation, especially since a commercial lease does not terminate simply because a tenant goes bankrupt. Rather, it is the terms of the lease that will allow the landlord to terminate it. From this perspective, a landlord might then benefit from a priority claim to a portion of his rent.*
*It should be noted the solutions suggested in this bulletin only apply in the case of an actual bankruptcy, and not in the context of a proposal under the Bankruptcy and Insolvency Act (BIA) or a restructuring under the Companies' Creditors Arrangement Act. Furthermore, while the BIA is federal legislation, our analysis focuses on its application in Quebec.
In most cases, the landlord is entitled to three months' rent in arrears.
Once the commercial lease is terminated, the landlord may recover up to three months’ rent in the order of priority provided for in the BIA. 1 In fact, the landlord ranks sixth, which means that he can be paid before unsecured creditors, but after secured creditors and other classes of prior claims provided for in the BIA, such as reasonable funeral and testamentary expenses in the case of a deceased bankrupt.
The priority granted to the landlord only applies to the amounts collectible as “rent” and excludes any amount relating to any damage caused by the tenant (for example repair costs).
In addition to the three months’ rent in arrears, the landlord may obtain three months’ accelerated rent (future rent), for a total of six months’ rent.
This additional amount can only be received when it is specifically provided for in the commercial lease. This amount also ranks sixth under the BIA.
However, there is a limit. The total amount received in priority may not exceed the amount that the trustee has realized from the tenant’s property on the leased premises. For the balance of its priority claim, namely the three months of arrears and three months of accelerated rent, the landlord will rank the same as any ordinary unsecured creditor.
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Cross-border acquisitions and investments increasingly trigger foreign direct investment (FDI) screening requirements.
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On February 2, 2024, the Belgian Presidency of the Council of the European Union confirmed that the Committee of Permanent Representatives had signed the Artificial Intelligence (AI) Regulation, referred to as the AI Act. Approval by the EU Parliament followed on 13 March 2024, and the AI Act is likely to appear in the EU’s Official Journal around May 2024. The AI Act aims to establish a stringent legal framework governing the development, marketing, and utilisation of artificial intelligence within the region, thereby marking a significant advancement in the regulation of this burgeoning domain.
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In the recent decision of Euronav Shipping NV (Euronav) v Black Swan Petroleum DMCC (BSP) [2024] EWHC 986 (Comm) (the Judgment), the English Commercial Court has underscored the role of comity in international disputes.
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