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CS Professional · Insolvency and Bankruptcy - Law and Practice · Group Insolvency

Alpha Ltd and Beta Ltd are group companies in separate CIRPs. The same insolvency professional is proposed as resolution professional for both, and a financial creditor of Alpha objects, saying Alpha has a claim against Beta. Which approach best reflects the position on procedural coordination?

The conflict arising from the inter-company claim must be examined, and the tribunal decides whether the same or different professionals should act, balancing independence against efficiency. There is no absolute bar on a common professional and no compulsion to appoint one, and the objection does not trigger substantive consolidation.

  1. AAppointing one professional is always barred, so procedural consolidation can never occur
  2. BThe conflict of interest from inter-company claims must be examined, and the tribunal may appoint the same or different professionals considering independence and efficiencyCorrect
  3. CThe objection is irrelevant since a single professional must handle every group company
  4. DThe creditor's objection automatically converts the case into substantive consolidation

Explanation

Coordination can use a common professional for efficiency, but where the entities have claims against each other, independence and conflict of interest matter. The tribunal weighs these. There is no blanket bar and no automatic mandate; nor does an objection cause substantive consolidation.

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