Cyprus Court Appoints Special Manager in Complex Cross-Border Liquidation Under Section 250

In a decision dated 22 January 2025, the District Court of Nicosia appointed a Special Manager to act in the liquidation of East Point Metals Limited, exercising its powers under section 250 of the Companies Law, Cap. 113. The decision provides rare and important guidance on the use of special management in complex cross-border insolvency scenarios.

The application was filed by the Official Receiver and Liquidator of the company, seeking the appointment of a Special Manager with defined powers and remuneration. The Court was satisfied that the nature of the company’s assets and operations, as well as the interests of creditors, required the appointment of a person other than the Official Receiver to manage specific aspects of the liquidation.

The Court accepted that the company, although solvent, had been placed into liquidation following shareholder disputes and held substantial assets and subsidiaries outside Cyprus, including in Serbia and Germany. It further accepted that the effective management and protection of those foreign assets required specialised expertise and resources not available to the Official Receiver.

In its legal analysis, the Court referred to section 250 of Cap. 113 and drew guidance from English insolvency law and Halsbury’s Laws of England, confirming that the Court has a broad discretion to appoint a Special Manager where this is necessary in the interests of the company and its creditors. The Court also noted that a Special Manager may be entrusted with extensive powers, including powers equivalent to those of the Official Receiver, as required for the proper discharge of the role.

The Court was satisfied that the appointment sought was necessary and proportionate and proceeded to appoint the proposed Special Manager, approving his powers, remuneration, reporting obligations and the provision of security.

This decision is among the very few reported Cypriot cases in which section 250 has been applied in the context of a large-scale cross-border liquidation. It highlights the flexibility of the Cypriot insolvency framework and the Court’s willingness to deploy special management as a practical tool in complex international restructurings and liquidations.