Mercer Agencies - Case Update

The Irish High Court has recognised a Northern Ireland administration for the first time since the UK exited the EU, highlighting the different considerations that now apply in the post-Brexit period than would have applied under the EU-era European Insolvency Regulation.

Mercer Agencies, a wholesale distributor of garden and seasonal products, entered administration in Northern Ireland in late 2024. Shorty thereafter, joint administrators Ian Davison and Scott Murray of Keenan Corporate Finance applied for recognition from the Irish Court to allow them to carry out their statutory functions.

In its judgment recognising the Northern Irish administration, the Court confirmed its jurisdiction under its inherent common law powers to recognise foreign insolvency proceedings even in the absence of applicable EU regulations. Although there was no direct precedent for recognising a Northern Irish administration post-Brexit, the Court drew analogies from prior cases involving insolvency officeholders from other non-EU jurisdictions, particularly the British Virgin Islands. The Court was satisfied that the Northern Irish administration was sufficiently equivalent to Irish liquidation procedures under the Companies Act 2014 in terms of purpose and powers.

Interestingly, the Court specifically acknowledged the different factors it is now required to consider in an application for recognition that would not have been relevant under the EU regime. It stated:

“Under that regime this court would not look behind the order or other evidence of the appointment of an insolvency office holder, such as an administrator. Nor would it be necessary for this court to consider, as I do below, such questions as equivalence of the insolvency process. The differences between administration in Northern Ireland and liquidation in the State would not be relevant. Recognition would be accorded of the appointment and powers of the administrators in accordance with the lex concursus of their procedure, namely the powers conferred on them under the 1989 Order. An application of this nature would, subject to some exceptions, not be required.”

Ultimately, the Court granted the recognition orders, enabling the joint administrators to act on behalf of the company in Ireland without delay or jurisdictional challenge. Given the ex parte nature of the application, the Court provided liberty for affected parties to apply for reconsideration on notice.

Read the decision HERE.