Re Fwd Life Insurance Co (Bermuda) Ltd and Another

HCMP 1440/2020

[2020] HKCFI 3049

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 1440 OF 2020

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REASONS FOR DECISION

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A.      Introduction

1.On 7 December 2020, I heard the application made by Petition dated 11 September 2020, jointly presented by FWD Life Insurance Company (Bermuda) Limited (“FWD”) and Sun Life Hong Kong Limited (“Sun Life”) (together “Petitioners”).

2.By the Petition, FWD and Sun Life sought an order sanctioning the scheme (“Scheme”) to effect the transfer from FWD of the Class G (retirement scheme management category I) long term business carried on by it to Sun Life.  Sanction of the Scheme was sought under section 24 of the Insurance Ordinance Cap 41 (“Ordinance”).  There was also an application for ancillary provisions for the implementation of the Scheme under section 25 of the Ordinance.

3.The application made by the Petition was supported by affirmation evidence from senior management and the appointed actuary of both FWD and Sun Life, as well as the Report dated 26 September 2019 of Mr Clement Bonnett, the independent actuary (“Independent Actuary”), and his Supplementary Report dated 14 August 2020 (“IA Report” and “Supplementary IA Report” respectively).

4.As is typical in an application of the sort made by the Petition, there was a previous directions order – here made by Mimmie Chan J on 28 September 2020 – relating to publication and service of the Statutory Notice and Statutory Statement in accordance with section 24 of the Ordinance.

5.At the hearing, FWD and Sun Life were represented by Counsel Mr Victor Dawes SC and Ms Natalie So.  The Insurance Authority also appeared, by Counsel Mr Jeffrey Chau and Ms Alice Lau.  Both teams filed helpful skeleton submissions in advance of the hearing.  No other interested person appeared at or was represented at the hearing.

6.At the end of the hearing, for reasons which I said I would hand down later, I made an Order sanctioning the Scheme, to be annexed to the Order as Schedule 1, pursuant to section 24 of the Ordinance, and further ordered that:

(1)     pursuant to section 25 of the Ordnance (using the definitions in the Scheme), all other contracts, rights, obligations and commitments of FWD with respect to the Transferring Policies and Business or otherwise relating to its undertaking, property or liabilities as specified in the Scheme shall, on and from the Transfer Date, be transferred to be vested in Sun Life;

(2)     the Petitioners shall post the Order of Hon Madam Justice Mimmie Chan dated 28 September 2020 (together with its Annexures 1 and 2), the Petition, the Independent Actuary’s Report dated 26 September 2019 and the Supplementary Report dated 14 August 2020, the Further Notice and this Order on www.fwd.com.hk/en and www.sunlife.com.hk, and maintain that posting until the Transfer Date;

(3)     there be liberty to apply for the purpose of modification of the Scheme under Clause 11 of the Scheme or the purposes set out in section 25 of the Ordinance;

(4)     the Petitioners do pay the costs of the Insurance Authority in relation to the Petition, to be taxed on a common fund basis if not agreed.

7.These are my Reasons for Decision.

B.     The Petitioners

8.FWD (the transferor) is part of the FWD Group, which is the insurance business arm of Pacific Century Group.  It is incorporated in Bermuda and regulated by the Bermudan Monetary Authority (“BMA”). It has a class E and class 3 licence under the Bermuda Insurance Act 1978.

9.In Hong Kong, FWD is registered as a non-Hong Kong company under the Companies Ordinance Cap 622 (“CO”), and is authorised to carry out various long-term business under Part 2 of Schedule 1 of the Ordinance.

10.Sun Life (the transferee) was incorporated in Bermuda and is wholly owned by Sun Life Assurance Company of Canada.  It is also regulated in Bermuda by the BMA, and has a class E licence under the Bermuda Insurance Act 1978.

11.Sun Life is also registered as a non-Hong Kong company under the CO.  It is authorised to carry out different long-term business under Part 2 of Schedule 1 of the Ordinance.

C.     The Insurance Authority’s position

12.It is convenient at this point to identify the position taken by the Insurance Authority (“Authority”) as regards the Scheme and the application made by the Petition.

13.Drafts of the Scheme, IA Report, Supplementary IA Report and other supporting documents were provided to the Authority prior to the presentation of the Petition, and the Authority’s comments have been incorporated into the Scheme.  Indeed, the Authority confirms that it has been kept informed of the progress of the Scheme and these proceedings.

14.The Authority is satisfied that the directions given by Mimmie Chan J and the relevant statutory requirements under section 24 of the Ordinance have been complied with.  The Authority has also confirmed that in compliance with section 24(3)(c) of the Ordinance, and paragraph 5 of the Order of Mimmie Chan J, copies of the Statutory Statements, the Petition, the Scheme, the IA Report and the Supplementary IA Report were served on the Authority on 23 October 2020.

15.As regards the enquiries made about the Scheme, the Authority is satisfied that those enquiries have been addressed by the Petitioners.

16.In conclusion, and having had regard to all relevant circumstances and information made available to it, in particular the opinion of the Independent Actuary, the Authority had no objection to the Scheme, nor to the orders sought.

17.The Authority also had no objection to the new proposed Transfer Date of 1 February 2021, and agreed that there should be measures incorporated into the Order to ensure that all interested parties would be kept abreast of the new Transfer Date.

D.     Bermuda Court Sanction

18.In updated evidence filed shortly before the hearing, I was informed that the Scheme had been sanctioned by the Bermuda Court.

19.The sanction was given by the Bermuda Court at a hearing on and by Order dated 24 November 2020.

E.     The Scheme

20.The background leading to the Scheme is set out in the Petition, and the supporting evidence.

21.On 3 August 2016, Sun Life and FWD Management Holdings Limited (“FMH”) (being a part of the FWD group) entered into an Implementation Agreement for disposal of various FWD’s MPF and ORSO businesses in Hong Kong (namely, the “MPF Schemes” and “ORSO Schemes”).

22.The disposal to Sun Life (and its nominees) includes, inter alia, (i) the shareholding of the then FWD Pension Trust Limited (“FWDPT”) (the trustee of the MPF Schemes); and (ii) insurance policies in the nature of class G (retirement scheme management category I) long term business underlying the MPF Schemes and ORSO Schemes.

23.The Scheme forms part of that disposal by FWD.  It involves part (ii) of the disposal (as set out above), whereby 71 Class G Policies underlying the MPF Schemes and ORSO Schemes are to be transferred to Sun Life (“Transferring Policies” or “Business”). Policyholders of the Transferring Policies are referred to as “Transferring Policyholders”.

24.Other than the transfer of the Business, the Scheme also provides for the transfer of the Transferring Assets and Transferring Liabilities, Residual Assets and Residual Liabilities relating to the Transferring Policies.

25.In his submissions for the hearing, Mr Dawes highlighted the following definitions set out in the Scheme:

(1) “Business” is defined as “the long term business (as defined in the Ordinance) carried out by FWD in respect of the Transferring Policies”.

(2) “Transferring Policies” are defined as all Class G Policies underwritten in or from Hong Kong by FWD under and in respect of the MPF Schemes and ORSO Schemes as at the Transfer Date (as detailed in the Schedule of the Scheme), but not including policies in respect of FWD’s staff plan and agency plans.

(3) “Transferring Assets” are defined as the property, assets or investment of FWD as are attributable to the Business, which shall be transferred to Sun Life on or around the Transfer Date pursuant to and under the Implementation Agreement, but not the Residual Assets (as defined in the Scheme, see below).

(4) “Transferring Liabilities” are defined as all liabilities of FWD as at the Transfer Date attributable to the Business, which shall be transferred to Sun Life on or around the Transfer Date pursuant to and under the Implementation Agreement, but not the Residual Liabilities (as defined in the Scheme, see below).

(5) “Residual Assets” refer to any property, assets or investment of FWD, and such other property, asset or investment as is attributable to the Business, which shall be transferred to Sun Life on or around the Transfer Date pursuant to and under the Implementation Agreement, but in respect of which as at the Transfer Date (a) the consent of any person(s) is required but has not been obtained; (b) the waiver of any person(s) is required but has not been obtained; or (c) FWD and Sun Life agree that its transfer should be delayed (to the extent only of that part of the interest of FWD in such property or asset the transfer of which such consent and/or waiver is required and/or such agreement is reached), as well as any proceeds of sale or income or other accrual or return whatsoever from time to time earned or received in respect of the aforesaid property or asset.

(6) “Residual Liability” refers to any liability whatsoever of FWD (i) which is attributable to or connected with a Residual Asset, and arises at any time before the Subsequent Transfer Date in relation to such Residual Asset; or (ii) the transfer of which to Sun Life pursuant to the Scheme requires, as at the Transfer Date, the consent of any person(s) or waiver of any person(s) and which is attributable to or connected with the Business, but has not been obtained.

(7) “Transfer Date” is defined as the time and date on which the Scheme shall become effective, namely at 12:01 am (HKT) on such date as FWD and Sun Life may decide, which shall be within 90 days after the later of the dates on which the Order of the Hong Kong Court (“HK Order”) or the Bermuda Court (“Bermuda Order”) sanctioning the Scheme is granted: see Clause 10.1.

26.Pursuant to the Scheme:

(1) By Clauses 3.1, 4.1 and 5.1 respectively, each of the Transferring Assets, Transferring Liabilities and Transferring Policies shall be transferred to Sun Life on and with effect from the Transfer Date, by virtue of HK Order and the Bermuda Order,and without any further act or instrument.

(2) By Clauses 3.2 and 4.2, the Residual Assets and Residual Liabilities shall be transferred to Sun Life on each Subsequent Transfer Date, by virtue of HK Order and the Bermuda Order,and without any further act or instrument.

(3) Those clauses also expressly require FWD from the Transfer Date to hold the Residual Assets as trustee and in trust for Sun Life absolutely and subject to Sun Life’s directions, and require Sun Life from the Transfer Date to perform the obligation or liability being a Residual Liability on behalf of FWD, or failing that to indemnify FWD against such obligation and liability.

(4) By Clause 6, any proceedings by or against FWD in relation to the Transferring Assets, Transferring Liabilities and Transferring Policies shall be deemed to have been continued by or against Sun Life, in substitution for FWD.

(5) By Clause 7.1, from the Transfer Date, Sun Life shall establish 3 new sub-funds, maintained as separate sub-accounts under its Sun Life Class G Fund (see), to which the Transferring Assets, Transferring Liabilities and Transferring Policies will be allocated pursuant to Clauses 7.2-7.7.

(6) By Clause 8.1, all premiums, loan repayments and other amounts received or receivable by FWD in respect of any of the Transferring Policies on or after the Transfer Date shall be payable to Sun Life after that date.

(7) By Clause 9, the Petitioners shall bear the costs of the Scheme out of their own funds.

(8) By Clause 11, save for amendments to correct manifest error and/or reasonably considered to be necessary to ensure the Scheme operates in the intended manner when there is a change in the relevant law (where there is no objection from the Authority and the BMA upon their being notified), the Scheme can only be modified with the approval of the Hong Kong Court and the Bermuda Court.

27.The proposed transfer of the Business is said to be expected to add scale to Sun Life’s existing Class G long term business while capitalising on Sun Life’s expertise in retirement products.  It is said it will also offer economies of scale and enhance operational efficiencies and service standards, given that Sun Life has 80 Class G Policies issued and maintained for its MPF and ORSO schemes in Hong Kong.

28.The Transfer contemplated under the Scheme cannot proceed unless:

(1) approvals from the Mandatory Provident Fund Schemes Authority (“MPFA”)and the Securities and Futures Commission (“SFC”)are obtained in Hong Kong (with respect to the transfer of the Transferring Policies issued under both the MPF Schemes and ORSO Schemes);

(2) there is approval or non-objection of the BMA; and

(3) both the Hong Kong Court and the Bermuda Court sanction the Scheme.

29.The MPFA approval was obtained on 25 March 2020.  The two types of approval for transfer of the Transferring Policies issued under the MPF Schemes and the ORSO Schemes required from the SFC were obtained respectively on 25 March 2020 and 29 May 2020.

30.Non-objection from the BMA was obtained on 17 September 2020.

31.As indicated above, the sanction of the Bermuda Court was given on 24 November 2020. For the reasons now being given, the sanction of the Hong Kong Court was given on 7 December 2020.

F.     The Legal Framework and Approach

32.There is no dispute that the relevant statutory framework is to be found in sections 24 and 25 of the Ordnance, and that the approach to be taken by the Court is now well-established.

33.Section 24(2) identifies that the Court shall not determine an application unless (a) the Petition is accompanied by a report from the IA, and (b) the requirements of section 24(3) have been complied with, namely:

(1) publication of the Statutory Notice: section 24(3)(a);

(2) the sending of the Statutory Statement (setting out the terms of the scheme, and a summary of the report(s) of the IA) to policyholders and every member of the insurers, except where the Court has otherwise directed: section 24(3)(b);

(3) the service of the Petition, the report(s) of the IA and the Statutory Statement on the Authority at least 21 days before the determination of the Petition: section 24(3)(c); and

(4) that copies of the Petition and the report(s) of the IA be open to inspection at offices in Hong Kong of the insurers for a period of not less than 21 days beginning with the date of the first publication of the Statutory Notice: section 24(3)(d).

34.If these conditions are satisfied, the Court may in its discretion sanction the scheme.

35.Whether or not to sanction a scheme is an exercise of judicial discretion.  The principles underlining such exercise of discretion include – see, for example, Re Prudential Assurance Company Ltd [2014] 1 HKLRD 433 at §18, referring to Re AXA Equity and Law Life Assurance Society Plc[2001] 2 BCLC 447, 468E-496B; and Re Transamerica Life Insurance Company[2013] 2 HKLRD 871 at §47:

(1) The Ordinance confers an absolute discretion on the Court whether or not to sanction a scheme, and the discretion must be exercised by giving due recognition to the commercial judgment entrusted by the company’s constitution to its directors.

(2) The Court is concerned with whether a policyholder, employee or other interested person or any group of them will be adversely affected by the scheme.

(3) That is primarily a matter of actuarial judgment involving a comparison of the security and reasonable expectations of policyholders without the scheme, with what would be the result if the scheme were to be implemented.

(4) Hence, the Court will consider the contractual rights and reasonable expectations of transferring policyholders before the scheme is implemented, and compare that with the likely effect and result on such rights and expectations if the scheme is implemented.

(5) This is especially so, where the purpose of the scheme is to advance a commercial purpose of the transferor (and transferee) with no corresponding benefit to the transferring policyholders.

(6) The Ordinance assigns an important role to the Independent Actuary, to whose report the Court will give close attention.

(7) The Court will also pay close attention to any views expressed by the Authority, which is expected to be able to express informed opinions on whether policyholders would be adversely affected.

(8) The fundamental question is whether the scheme as a whole is fair as between the interests of the different classes of persons affected.

(9) It is not the Court’s function to produce what is, in its view, the best possible scheme.  The Court will either sanction the scheme provided to it, or it will not.

(10) As such, that individual policyholders or groups thereof may be adversely affected does not mean the scheme has to be rejected.  Similarly, the details of the scheme are not a matter for the Court, provided that the whole scheme is found to be fair.

36.Section 25 of the Ordinance further allows the Court to make provision for inter alia the transfer to the transferee company of the undertaking, property and liabilities of the transferor company, the continuation by or against the transferee company of any legal proceedings pending by or against the transferor company, and such incidental, consequential or supplementary matters as are necessary to secure that the scheme shall be fully and effectively carried out.

G.     The Independent Actuary’s Reports

37.In preparing both reports, the Independent Actuary had access to documentary evidence provided by FWD and Sun Life (as set out in Appendix B to the IA Report).  He also relied on, and had unrestricted access to and held discussions with, the appointed actuaries and other members of FWD’s and Sun Life’s senior management teams.

38.The Independent Actuary’s opinion was that:

(1) The Scheme would have no material adverse effect on the reasonable benefit expectations of the Transferring Policyholders, nor the policyholders of non-transferring policies of FWD or existing policyholders of Sun Life.

(2) The Scheme would have no material adverse effect on the financial security of the Transferring Policyholders, nor the policyholders of non-transferring policies of FWD or existing policyholders of Sun Life.

(3) The Scheme would have no material adverse effect on the level of service to the long term policyholders of the Petitioners.

(4) The Scheme provided sufficient safeguards to ensure it operated as presented.

39.In his written submissions, Mr Dawes had provided a helpful summary of the Independent Actuary’s findings on individual issues relating to the proposed Transfer.  That summary was accepted by Mr Chau as fair and accurate, and it might broadly be set out as follows.

40.As regards the benefit expectations of Transferring Policyholders:

(1) Sun Life had confirmed that it would follow the current crediting rate policy adopted by FWD, and that there would not be any significant change to existing principles and methods following implementation of the Scheme.

(2) Periodic review of crediting rates methodology will remain unchanged, and the investment policy for the Business would also be consistent with pre-transfer investment policy.

(3) In the premises, there would be sufficient safeguard that policyholders should expect to be treated in a similar manner before and after the Transfer.

(4) The current charge level for the Business will not change materially as a result of the transfer.

(5) Sun Life will also commit to continue paying guaranteed benefits of Transferring Policyholders of FWD; their rights will be the same before and after the Transfer.

(6) As there will be no change to the policy terms and conditions of the Business as a result of the Scheme implementation, the IA had no reason to believe there would be adverse impact on the policy terms and conditions of policyholders due to the Scheme itself in this regard.

(7) Therefore, there would be no material adverse effect on the reasonable benefit expectations of the Transferring Policyholders.

41.As regards the effect on the financial security of Transferring Policyholders:

(1) The reserves held after the Transfer by Sun Life will be higher than the reserves held by FWD before the Transfer.  There would be no change in (i) the minimum GL7 reserve; (ii) the smoothing reserve for MPF; (iii) procedures (ie. disclosure of reserving methods and valuation bases of the Business and existing business in the annual actuary’s report); (iv) compliance with local regulation and prescribing guidelines after the Transfer.

(2) Therefore, the changes in procedures in determining the valuation methodology would not materially impact the financial security of the Transferring Policyholders.

(3) Sun Life’s solvency positions remain above the regulatory requirement in most of the prescribed scenarios (which are directly comparable to FWD’s prescribed scenarios), and above 100% in all the scenarios. There is no material difference in the future solvency positions of Sun Life irrespective of the Transfer, given the lack of materiality of the Business in Sun Life’s total portfolio.

(4) The risk exposure of Sun Life total portfolio after Transfer appears comparable to FWD’s before Transfer.  There is no identified area where additional risk exposure resulting from the Scheme implementation is likely to prejudice the contractual entitlements of the Transferring Policyholders so as to adversely affect their financial security.

(5) Sun Life has confirmed it would maintain a similar approach as FWD in relation to investment policies.

(6) Given the higher total reserves, and the lack of material difference in future solvency position of the Business, there will be no material adverse effect on financial security of Transferring Policyholders.

42.As to other considerations for the Transferring Policyholders, the Independent Actuary considered that none of the various operational areas identified in the IA Report would have a material adverse impact on the long term policyholders of the Petitioners (including the Transferring Policyholders), given inter alia that the group structure of the Petitioners will remain unchanged after the Transfer, and the existing range of fund choices currently available to the Transferring Policyholders will be maintained after the Transfer.

43.As regards the other policyholders (other than the Transferring Policyholders):

(1) There will be no material adverse effect on the reasonable benefit expectations, given that (a) assets backing the policies of remaining policyholders of FWD are managed separately from the assets underlying the Transferring Policies, (b) Sun Life will maintain the Business separately from its existing business, and (c) investment strategies or policies, and policy terms and conditions, of the Petitioners will not be changed for non-transferring policies (for FWD) or existing policies (for Sun Life).

(2) There will be no material adverse effect on the financial security of existing policyholders of Sun Life.  Nor will the Scheme expose holders of non-transferring policies of FWD to new risks of significance, ie. there will be no material adverse effect on them either.  The statutory reserve of FWD’s retained ORSO business will not be affected by the Transfer, and the solvency of both Petitioners remains satisfactory and above the regulatory minimum requirement.  Nor is the risk exposure materially changed for any of the other policyholders.

44.As regards to policyholder communications, the Independent Actuary concluded that the dispensations sought by the Petitioners in relation to notification to the relevant policyholders (and later granted by Mimmie Chan J) would not have a material adverse effect.

45.In the Supplementary IA Report, he confirmed that his opinion was unchanged notwithstanding the developments which took place since the IA Report.  Those developments included (i) updated details of long term and retirement business of FWD, and of the long term insurance business of Sun Life, as at 31 December 2019; (ii) the discretionary crediting rate (which may affect the discretionary benefits of FWD’s ORSO business); and (iii) the updated financial position of the Petitioners as at 31 December 2019.

46.Finally, he restated his opinion that the Scheme would have no material adverse effect on either the reasonable benefit expectations or financial security of all relevant policyholders, and that he has not changed his conclusions regarding the likely effect of the Scheme.

H.     The Appointed Actuaries’ Opinions

47.The appointed actuaries of each of the Petitioners have opined that the Scheme should not have a material adverse effect on the reasonable benefit expectations of non-transferring policyholders (for FWD), or existing policyholders (for Sun Life), or the Transferring Policyholders.

48.They have also opined that the Scheme should not have a material adverse effect on the financial security of all relevant policyholders.  One particular point noted was that because the terms of the Transferring Policies would not be changed, there would be no impact on any contractual rights of the Transferring Policyholders other than the change of insurer.

I.     Other Enquiries and Views

49.The Statutory Notice stated that any person(s) intending to appear or object is required to give 7 days’ prior written notice of such intention (and the reasons therefor) to Ps’ solicitors.  However, no notice of intention to appear, or to object to the Scheme, was received by either of the Petitioners or their solicitors.

50.As I have already indicated, no other interested person appeared at or was represented at the hearing.

51.In any event, by close of business on 6 November 2020, FWD had received 15 enquiries from 14 agents who were participants of non-transferring Class G schemes; and Sun Life had received 1 enquiry from an insurance broker who represented a policyholder of a Class G policy of Sun Life, and 11 enquiries from 11 policyholders.  I accept that all such enquiries have now closed.

J.     Analysis

52.I was satisfied that the requirements under section 24 of the Ordinance had all been satisfied.

53.The Petition was supported by both the IA Report and the Supplementary IA Report.  The Statutory Notice was published on 16.10.2020 in the Gazette (in both English and Chinese), the South China Morning Post in English, and in the Hong Kong Economic Times in Chinese.  The Statutory Statement was sent to (i) the shareholders of FWD and Sun Life; and (ii) each of the Transferring Policyholders; and (iii) each policy holder of Class G Policies of Sun Life having his/her name appear on the register of policyholders maintained by Sun Life (or, if the address of a policyholder (being a person to whom under a policy a benefit is due or a periodic payment is payable) is not known to Sun Life, as the last known address of the employer of such policyholder for onward delivery to such policyholder).

54.I also note that, by §§3 and 4 of the Order of Mimmie Chan J, the sending of the Statutory Statement to other long term policyholders of FWD and policyholders of non-Class G policies of Sun Life was dispensed with, as was the need to set out the terms of the Scheme in full.

55.Further, as the Authority has acknowledged, copies of the Statutory Statements, the Petition, the Scheme, the IA Report and the Supplementary IA Report were served on the Authority in good time.  Copies of the Statutory Statements, the Petition, the Scheme, the IA Report and the Supplementary IA Report were made open for inspection at the offices of FWD and Sun Life from 16 October 2020 to 6 November 2020.

56.I was also satisfied that the other paragraphs of the Order of Mimmie Chan J were complied with.

57.Both FWD and Sun Life made available copies of the Statutory Statements, the Petition, the Scheme, the IA Report and the Supplementary IA Report for furnishing to any person who asked for them.  Both FWD and Sun Life have posted copies of the Statutory Statements, the Petition, the Scheme, the IA Report and the Supplementary IA Report on their respective websites (and which postings were to be maintained until an Order sanctioning the Scheme was made by the Hong Kong Court).

58.FWD have also procured the relevant trustees to send the notices to participants of the relevant schemes which are trust based, and has itself sent notices to participants of the relevant ORSO schemes and legal holders and participants of non-transferring Class G schemes.

59.As a matter of actuarial judgment, the Scheme has no material adverse effect on the Transferring Policyholders, or other policyholders of FWD and Sun Life.  Neither the reasonable benefit expectations nor financial security thereof will be adversely affected, which is a significant consideration for the Court.  I accepted those opinions.

60.I also accepted Mr Dawes’ submission that there is a fair balance struck as between the interests of different classes of persons affected, and the Scheme is a fair one overall.

61.Indeed, this was a relatively straightforward Scheme.  With the helpful and continuing involvement of the Authority in its development, and in the presentation of these proceedings, on which the Court places appropriate reliance, I was perfectly content to exercise my discretion so as to sanction the Scheme.

62.I was also satisfied that the ancillary orders sought pursuant to section 25 of the Ordinance should be granted.

63.A particular point arose in relation to the proposed Transfer Date, because the Petitioners had agreed to re-schedule the Transfer Date to 1 February 2021, subject to the sanction of the Hong Kong Court and the Bermuda Court.

64.As this was a development since the publication and issuance of the Statutory Notice and Statutory Statement, which referred to the date of 1 December 2020, the Petitioners proposed – and I included within my Order – the additional requirements which I have already set out above.  As agreed by Mr Chau for the Authority, those steps will ensure that all interested parties are kept abreast of the new Transfer Date.

K.     Conclusion

65.For the above reasons, I made the Order in the terms as set out in paragraph 6 above.

Mr Victor Dawes SC and Ms Natalie So, instructed by Baker & McKenzie, for the 1^st and 2^nd petitioners

Mr Jeffrey Chau and Ms Alice Lau, for the Insurance Authority