Re Pplive Sports International Ltd (in Liq)

HCMP 612/2024

[2024] HKCFI 1850

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 612 OF 2024

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REASONS FOR JUDGMENT

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1.There is before the court an application made by way of an ex parte originating summons filed on 12 April 2024 (“OS”) whereby the joint and several liquidators of PPLive Sports International Limited (“Company”) apply for an order that a letter of request in the form annexed to the OS be issued to the Shanghai No. 3 Intermediate People’s Court (“Shanghai Court”) for the purpose of seeking recognition and assistance in aid of the Company’s liquidation and its liquidators. At the hearing, I made an order in the terms set out in §23 below. These are the reasons for my judgment.

2.The application is supported by the Affirmation of Chi Lai Man Jocelyn, who is one of the liquidators, filed on 12 April 2024 (“Chi 1^st”).

Background facts

3.The Company was incorporated under the Companies Ordinance (Cap. 622) on 17 January 2017[1]. The Company’s registered office has always been located in Hong Kong.

4.The Company has been described in the publicly available information as being part of the sports broadcasting interests of Suning Holdings Group Co., Ltd, which carries on business in retail, real estate, investment and finance in the Mainland and the ultimate controllers are Zhang Jindong (張近東) and his son, Zhang Kangyang (張康陽)[2].

5.The principal business of the Company before its liquidation was broadcasting English Premier League football matches in the Mainland and Macau[3]. The former directors of the Company were Mr Mi Xin (米昕) (“Mr Mi”), Ms Zhu Hua (朱華) (“Ms Zhu”) and Mr Yang Yang (楊洋) (“Mr Yang”)[4].

6.In 2017 and 2019, the Company entered into contracts with The Football Association Premier League Limited (“FAPLL”) whereby it obtained from FAPLL a licence to broadcast live, delayed and on demand transmissions of English Premier League football matches and “clips” or highlights thereof in the Mainland and Macau during the 2019/20, 2020/21 and 2021/22 seasons (collectively “Rights”)[5].

7.On 12 April 2022, FAPLL presented a winding-up petition in HCCW 73/2022 against the Company in reliance on a judgment obtained from the English court, which in turn was based on the debts owed by the Company in connection with the Rights[6].

8.The Company was wound up by the court on 15 June 2022. At the time of its liquidation, the only director of the Company was Mr Zhu Dehua (祝德華) (“Mr Zhu”). The liquidators were appointed at the first meeting of the creditors of the Company held on 27 October 2022, and confirmed by the order of the court made on 18 January 2023[7].

9.Since their appointment, the liquidators have been investigating the assets and liabilities of the Company.

10.So far as liabilities are concerned, 4 creditors have filed proofs of debt of which FAPLL is the largest creditor. The amounts claimed by the creditors are as follows[8]:

Creditor	Amount
FAPLL	USD224,666,334.15
Great Mercury Ltd (in liq)	USD79,302,775.07
Bank of Shanghai (Pudong branch)	EUR20,924,988.43
Quinn Emanuel	USD547,721.27
Total	USD304,516,830.49 EUR20,924,988.43

11.As for assets, according to the liquidators’ investigations, the Company has at least the following assets or potential assets located in the Mainland:

(1)  4 bank accounts in Mainland, which are (a) Bank of Shanghai (Pudong Branch) account numbers 05000312713, 05000325505 and 03003363405; and (b) bank account at Ping An Bank (Nanjing Branch) account number OSA15000094953838[9].

(2)  Potential licence fees to be recovered from Suning Sports Culture Media (Beijing) Limited (蘇寧體育文化傳媒(北京)有限公司) (“Suning Beijing”), China Central Television (中國中央電視台) (“CCTV”) and/or other entities in respect of the sub-licensing of the Rights granted by the Company. According to the documents obtained by the liquidators[10]:

(a)  A Letter of Authorisation dated 21 October 2019 (“Letter of Authorisation”) was executed by the Company in favour of Suning Beijing whereby the Company authorised Suning Beijing to enter into a Sub-License Agreement with CCTV.

(b)  In turn, the Sub-Licence Agreement entered into between Suning Beijing and CCTV provided that CCTV had to pay licence fees of RMB 45 million to Suning Beijing (“Sub-Licence Fees”).

(c)  However, neither the Letter of Authorisation nor the Sub-Licence Agreement mentions payment of the Sub-Licence Fees (or any part thereof) to the Company in return for the sub-licensing of the Rights. Nor have the liquidators　identified　any　agreement　or　document entered into between the Company and Suning Beijing which deals with payment of the Sub-License Fees (or any part thereof) to the Company.

(d)  As the Company was the legal owner of the Rights and has authorised Suning Beijing to sub-license those Rights to CCTV, the Company should be entitled to receive the Sub-Licence Fees or at the very least, a substantial part thereof. The liquidators are duty bound to conduct further investigation into the matter and, if necessary, take step to recover the Sub-Licence Fees or any amount which Suning Beijing is liable to pay or account to the Company.

(3)  Potential licence fees to be recovered from Shanghai Synacast Media Tech. Co., Ltd (“Shanghai Synacast”)[11]. The liquidators believe that a similar sub-licensing arrangement has been made to allow Shanghai Synacast to use the Rights in the Mainland:

(a)  Although the liquidators have not found any written sub-license agreement involving Shanghai Synacast, in a Certificate of Authorisation 授權證明signed by FAPLL dated 18 July 2019 (“Certificate of Authorisation”), Shanghai Synacast was listed in Schedule 2 thereto as one of the Company’s affiliates entitled to use the Rights (alongside Suning Beijing).

(b)  Mr Yang was a common director of Shanghai Synacast and the Company at the time the Certificate of Authorisation was signed[12].

12.The liquidators are duty bound to investigate the above transactions and, if necessary, take steps to recover any licence fees or sub-licence fees payable, but have not yet been paid, to the Company, and to investigate whether in making the aforesaid sub-licensing arrangement(s), the directors acted in breach of their duties owed to the Company and, if so, to seek compensation from such directors.

13.Although the liquidators have communicated with various parties in connection with the above investigations, no meaningful response has been received from the parties concerned[13].

Analysis

14.The applicable principles governing an application for recognition and assistance of insolvency proceedings pursuant to the Cooperation Mechanism entered into on 14 May 2021 by the Supreme People’s Court and the Government of Hong Kong[14] are well established. As summarised in Re Trinity International Brands Limited [2023] HKCFI 1581, §§12-15, 18-20, and applied in Re Husk’s Green Technology Holding Co., Limited [2024] 1 HKLRD 134, §§18-27[15]. In short, the applicant needs to satisfy the court that:

(1)  The application is made by a liquidator in insolvency proceedings in Hong Kong.[16]

(2)  The recognition and assistance is sought from a court at a pilot area in the Mainland.[17]

(3)  The order sought is for recognition of the Hong Kong liquidator’s office, and grant of assistance for discharge of his duties as such liquidator.[18]

(4)  Hong Kong has been the centre of main interests (“COMI”) of the company in liquidation continuously for at least 6 months.[19] For this purpose, COMI “generally means the place of incorporation of the debtor. At the same time, the people’s court shall take into account other factors including the place of principal office, the principal place of business, the place of principal assets etc. of the debtor.”[20]

(5)  The company’s principal assets in the Mainland are in a pilot area, or it has a place of business or a representative office in a pilot area.[21]

(6)  The recognition and assistance sought is necessary to enable the liquidators to carry out their functions as liquidators of the company in the Mainland.[22]

15.In the present case, each of the above requirements above is satisfied.

16.First, the application is made by the liquidators of the Company. The Company has been in compulsory liquidation since 12 April 2022, being the date when the winding-up petition was presented[23].

17.Second, the recognition and assistance are sought from the Shanghai Court, which is a court at a pilot area.

18.Third, the order sought is for recognition of the liquidators’ office, and grant of assistance for discharge of their duties as liquidators in the Mainland.

19.Fourth, Hong Kong has been the COMI of the Company for more than 6 months in that it was incorporated in Hong Kong, its registered office has always been in Hong Kong, and the liquidation has since January 2023 been conducted in Hong Kong.

20.Fifth, the Company’s principal assets are located in Shanghai. These included the 3 bank accounts held with the Bank of Shanghai (Pudong Branch) (see §11(1) above) and the sub-licence fees which may be recovered from Shanghai Synacast, a company established in Shanghai[24].

21.Sixth, it is necessary for the liquidators to seek recognition and assistance to carry out their functions as liquidators of the Company in the Mainland, having regard to the following matters:

(1)  The banks with which the Company has bank accounts have refused to provide information and documents to the liquidators in the absence of an order from the Mainland court. An order from the Mainland court would be necessary without which the banks would not cooperate with the liquidators[25].

(2)  An order from the Shanghai Court would facilitate the liquidators’ investigation as both Shanghai Synacast[26] and Mr Yang[27] are located in Shanghai.

(3)  Suning Beijing is established in the Mainland. Mr Zhu, who signed the Letter of Authorisation and was the sole director at the time of the liquidation of the Company, was based in the Mainland[28].

(4)  The other former directors of the Company, Mr Yang, Mr Mi and Ms Zhu, are all based in the Mainland[29].

22.The powers of assistance sought by the liquidators, as stated in the letter of request, are the powers conferred on and exercisable by the liquidators under the CWUMPO. A table summarising the powers stated in the letter of request and the corresponding provisions under the CWUMPO are set out in Annex B hereto. The powers are materially identical to those set out in Appendix B to the judgment in Re Trinity.

Order

23.For the reasons set out above, it is appropriate for the court to make the following order:

(1)  A letter of request in the form of Annex A be issued to the Shanghai No. 3 Intermediate People’s Court seeking recognition and assistance in aid of the Company’s liquidation and its liquidators;

(2)  The liquidators’ costs, subject to taxation, be paid out of the assets of the Company; and

(3)  Liberty to apply.

Ms Jasmine Cheung, instructed by DLA Piper Hong Kong, for the Applicants

Annex A

根据认可和协助香港特别行政区破产程序试点方案发出的司法协助请求函

致：上海市第三中级人民法院（“上海法院”）

鉴于：

1.  本法庭是对香港特别行政区（“香港”）的公司法和破产法行使管辖权的法庭。

2.  PPLive Sports International Limited（“该公司”）是一家于2017年1月17日根据香港公司法注册成立的公司。

3.  2022年4月12日，The Football Association Premier League Limited 向本法庭提出了将该公司清盘的呈请。2022 年6 月1 5 日，本法庭命令将该公司强制清盘，理由是其无力偿还债务。

4.  2022 年10 月27 日，该公司债权人通过一项决议，确认委任Kroll (HK) Limited 的Cosimo Borrelli 先生和Chi Lai Man Jocelyn （徐丽雯）女士两人担任该公司的共同及个别清盘人（“清盘人”）。

5.  2023 年1 月8 日，本法庭发出一项命令，确认清盘人的委任。

6.  根据香港法（包括《公司 (清盘及杂项条文) 条例》（第32章）第197 条和第199(2) 和 (3) 条），清盘人已获授权共同及个别地作出（除其他外的）以下行为：

(1)  将该公司有权享有或看似有权享有的所有财产及据法权产，收归该清盘人保管或控制（第197条）；

(2)  藉公开拍卖或私人合约，出售该公司的土地财产、非土地财产及据法权产，并有权将该等财产及权产全盘转让予任何人或任何公司，或将它们分拆出售（附表25第3部 第1项）；

(3)  以该公司名义和代表该公司作出所有作为及签立所有契据、收据及其他文件，并可为该目的而在有需要时，使用该公司印章（附表25第3部 第2项）；

(4)  以该公司名义和代表该公司提起任何诉讼或其他法律程序，或以该公司名义和代表该公司在任何诉讼或其他法律程序中答辩（附表25第2部 第1项）；

(5)  调查该公司失败的因由及其在交易及事务中就此作出的处理；及

(6)  作出为结束该公司事务及派发该公司资产而需要作出的所有其他事情（附表25第3部 第9项）。

7.  清盘人认为，鉴于（其中包括）以下事实，若要根据香港法律有效行使他们的权力，需要上海法院认可他们的委任：

(1)  该公司在内地的资产包括：

(i)  该公司上海银行浦东分行的三个银行账户（账户号码05000312713、03003363405和05000325505) 内的资金；

(ii)  该公司在平安银行南京分行的一个银行账户（账户号码OSA15000094953838) 内的资金；

(iii)  该公司潜在可以从下列在内地注册成立的公司收回款项：

潜在债务人名称	金额
苏宁体育文化传媒（北京）有限公司	人民币45,000,000 元
上海聚力传媒技术有限公司	待定

(2)  该公司的董事祝德华先生目前在内地；及

(3)  清盘人相信该公司的前董事朱华女士，杨洋先生和米昕先生目前在内地。

8.  由于该公司在内地的主要资产是其银行账户内的资金及潜在可收回的款项，清盘人认为为了有效地行使其在香港法项下的权力，须由上海法院认可对他们的委任。

9.  因此，清盘人认为，根据香港法律，向上海法院寻求济助属适当行为，以便（特别及最重要的是）该法院能认可清盘人及其权力，从而允许他们：

(a)  索取并从第三方，包括但不限于上海银行，平安银行，上海聚力传媒技术有限公司以及该公司的董事祝德华先生和前董事朱华女士，杨洋先生和米昕先生收到与该公司及其发起、组成、业务交易、账目、资产、债务或事务有关的文件和信息；

(b)  找到、保护、取得及管有和控制该公司有权或看似有权在中华人民共和国（“中国”）内地法院管辖权内拥有的一切资产和财产；

(c)  找到、保护、取得及管有和控制该公司在中国内地法院管辖区内的账簿、文件和记录，包括会计和法定记录；及

(d)  调查该公司的事务，并在可能必要的范围内针对任何笫三方或与该公司有关联的任何一方，向中国内地法院提起法律程序和作出一切申请，当中不论是以其自身名义或以该公司名义。

10.  本案所提交的证据已证明并令本法庭信纳，向上海法院提出协助请求符合正义。为使清盘人能够履行其职责，谨请上海法院协助本法庭，在其认为适当的范围内，授权清盘人根据适用的内地法律在内地行使香港法律赋予他们的所有权力、职责和酌情权。

11.  本法庭谨请上海法院为清盘程序及清盘人提供协助，签发命令并指示：

(a)  该公司的清盘程序和清盘人的委任均得上海法院的认可；及

(b)  清盘人拥有并可行使香港法赋予他们的权力（如上文第6及第9段所载），并可在内地法律允许的最大范围内行使。

12.  任何清盘人被赋予权力执行或者需要执行的行动可以由所有清盘人共同执行或者由任何一个或以上的清盘人执行。

13.  本法庭确认，已根据香港的程序和法律发出本请求函及作出相关申请。

14.  为免产生疑问，寻求该协助旨在获得与本法庭因该公司资产专属于本法庭的管辖范围内所授予的济助大致相符的济助。

15.  本法庭进一步确认，香港法院将在类似情况下，并在行使其固有管辖权时，认可上海法院的请求函，并就该请求函提供可能需要的协助（受香港法律的适用限制约束）。

日期：2024年  月  日

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邝卓宏

香港特别行政区

高等法院司法常务官

 

Annex B