RE REGAN GLOBAL ALL WEATHER STRATEGY FUND SPC (In Official Liquidation in the Cayman Islands)

HCMP 251/2026

[2026] HKCFI 1533

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 251 OF 2026

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REASONS FOR JUDGMENT

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1.  By originating summons issued on 12 February 2026 (“OS”), Mr Russell Smith and Mr Yeo Boon Ann (“Yeo”), the joint official liquidators[1] (“JOLs”) of Regan Global All Weather Strategy Fund SPC (雷根全天候策略基金有限公司) (in liquidation) (“Company”), applies for an order recognising the liquidation of the Company and their appointment and “limited managerial assistance” for the purpose of carrying out their functions qua liquidators in Hong Kong. The application is supported by the Letter of Request dated 21 January 2025 issued by the Grand Court of the Cayman Islands ("Cayman Court")[2].

2.  At the hearing on 6 March 2026, this Court made an order in the terms set out in the Schedule hereto.  These are the reasons for my judgment.

Background

3.  The Company was incorporated on 8 May 2020 as a segregated portfolio company with limited liability in the Cayman Islands (registration number 362627).[3]

4.  The Company created and holds 2 segregated portfolios namely, Regan Global All Weather Strategy Fund I SP (“SP1”) and Regan Global All Weather Strategy Fund II SP (“SP2”).  The JOLs have been advised that under Cayman law, the assets and liabilities of each portfolio are “legally separated” from the assets and liabilities of the Company[4].

5.  Before its liquidation, the Company’s directors were Mr Li Hailong (“Mr Li”) and Ms Tian Yufeng (“Ms Tian”), while its sole shareholder was Regan Fund Management Company Limited (雷根基金管理有限公司),[5] which is also the investment manager of the Company (“Investment Manager”).  Mr Li is the sole director of the Investment Manager. 

6.  On 5 May 2023, the shareholder passed a resolution to put the Company into voluntary liquidation and appointed Mr Russell Smith, Yeo and Mr Declan Magennis as joint liquidators (“JVLs”).[6] No declaration of solvency was filed within 28 days of the commencement of the liquidation as one of the directors considered that the Company was insolvent.

7.  By petition presented on 9 June 2023, the JVLs applied for an order that the liquidation be continued under the supervision of the Cayman Court pursuant to s.124 of the Companies Act (2023 Revision) (“Act”), in view of what appears to be dissipation of substantial assets of the Company immediately prior to commencement of the liquidation and attempts to remove further assets from the Company after its liquidation by the former management[7].

8.  On 16 June 2023 the Cayman Court ordered the voluntary liquidation be continued under the supervision of the Cayman Court (“Supervision Order”) and appointed the JVLs as the Company’s joint liquidators (i.e. JOLs). As a result of the Supervision Order, the JOLs have and may exercise the powers set out in Part I and II of the Third Schedule to the Act[8].

9.  Based on their investigations, the JOLs identified the following assets located in Hong Kong:

  (1)   6 bank accounts maintained with DBS Bank Limited, Hong Kong Branch (“DBS”) of which 3 are for SP1 and 3 for SP2[9];

  (2)   Securities accounts at GF Securities (Hong Kong) Brokerage Limited (“GFS”) and Guotai Junan Securities (Hong Kong) Limited (“Guotai”) in which 4,055,200 shares in Confidence Intelligence Holdings Limited (stock code 01967) (“ListCo”) had been deposited, which were withdrawn by Mr Li prior to the appointment of JVLs and the share certificates collected by Ms Hui Sha Sha (“Hui”) pursuant to the authorisation letters signed by Mr Li in April 2023 (collectively “Withdrawn Shares”)[10];

  (3)   Residual cash of HK$2,123.23 and HK$22,897 in SP1 and SP2’s account at GFS, and 500 shares in Suxin Joyful Life Services Co., Ltd (a listed company, stock code 2152) in SP2’s account at GFS[11];

  (4)   2 margin accounts at GFS in respect of SP1 and SP2, and from which 3,096,200 shares and 147,800 shares in ListCo (part of the Withdrawn Shares) were withdrawn pursuant to the instructions given by Mr Li on 6 April 2023 and the relevant share certificates collected by Hui[12].

  (5)   2 margin accounts at Guotai in respect of SP1 and SP2, and from which 398,000 shares and 413,200 shares in ListCo (part of the Withdrawn Shares) were withdrawn pursuant to the instructions given by Mr Li on 13 and 25 April 2023 and the relevant share certificates collected by Hui[13].

10.  Shortly after their appointment, the JOLs requested DBS to transfer the funds to the JOLs.  However, in its letter dated 2 June 2023, DBS declined to comply with the request and suggested the JOLs to “obtain an order from the Hong Kong Court confirming that the [JOLs]  have the power and authority to act as the agent and on behalf of and in the name of the [Company] in Hong Kong” including to secure and take possession and control of the Company’s assets and property and to operate, open or close bank accounts on behalf of the Company[14].

11.  Although GFS provided documents relating to the withdrawal of ListCo’s shares in the accounts maintained by the Company, it refused to accede to the JOLs’ request for transferring the remaining securities and funds out of the Company’s accounts “unless it is provided with a recognition order of the Company’s liquidation and the JOLs’ appointment from the Hong Kong Court”.[15]

12.  Similarly, although Guotai provided documents relating to the withdrawal of ListCo’s shares from the accounts maintained by the Company to the JOLs, it has not agreed to transfer the residual cash to the JOLs[16].

13.  Since 27 May 2023 the JOLs have repeatedly demanded Mr Li and Ms Tian to return the Withdrawn Shares but to no avail[17].

14.  The JOLs reported the loss of the Withdrawn Shares to Trico Investor Services Limited, the share registrar of the Company (“Tricor”).  By letter dated 8 September 2023, Tricor accepted the reported loss and explained the share certificate replacement process.  On 5 July 2014, Tricor informed the JOLs that replacement share certificates were ready for collection, and the same were collected by the JOLs on 16 October 2024[18].

15.  According to the JOLs’ investigations, the Company has substantial assets (held through SP1 and SP2) in the form of loans advanced to third parties which remain unpaid:

  (1)   The Company (through SP1 and SP2) as lender entered into various loan agreements with China Huaxin (as borrower) whereby an aggregate amount of US$24.13 million was advanced during the years from 2021 to 2023.  The loan agreements are governed by Hong Kong law and the parties agreed to submit to the jurisdiction of Hong Kong court.  Central Wealth Limited and Hong Kong Fintech Co Ltd provided guarantees in favour of the relevant SP to secure the borrower’s repayment obligations.  All the loans have since January to August 2023 become due and payable.  In May and August 2023, the JOLs issued demand letters to China Huaxin and the guarantors for repayment of all amounts due but no payment has been received[19].

  (2)   The Company (through SP2) advanced a HK$100 million loan to YuLong International Capital Limited (“YuLong”) during the year from 2021 to 2022.  The loan is guaranteed by YL Media & Entertainment Ltd (a Cayman company).  As at 28 February 2023, the amount due was HK$102,874,314. Despite demands made by the JOLs in May and August 2023, neither YuLong nor the guarantor paid the amount due. 

16.  The audited financial statements of the Company for the year ended 31 December 2021 were audited by PriceWaterhouseCoopers (“PwC”), which opined that they gave a true and fair view of the financial position of the Company.  The JOLs understood that majority of the audit work might have been performed by the Hong Kong office of PwC.  The JOLs need to investigate the work performed by PwC in respect of the loans’ balances and the amounts which had been in default at the relevant times[20].

17.  The majority of the administration function was performed by the Hong Kong office of Bolder Fund Services (Cayman) Ltd (“Bolder”) where the books and records of the Company have been kept.  The JOLs have not been able to obtain all the books and records from Bolder and many documents remain outstanding[21].

18.  Mr Li has attempted to enter into settlement agreement with selected investors and may have used the Company’s assets for such purpose.  Despite the JOLs’ requests made from May to June 2023, Mr Li failed to provide the agreements to the JOLs[22].

19.  The upshot of the above is that the JOLs have since their appointment been able to obtain some documents and information relating to the assets of the Company from various third parties in Hong Kong and have been able to recover the Withdrawn Shares. 

20.  Against the above background, on 15 November 2024, the JOLs applied to the Cayman Court for an order approving the issue of a letter of request.  The order was granted on 10 December 2024[23].  On 21 January 2025, the Cayman Court issued the Letter of Request to Hong Kong court for recognition of the liquidation and appointment of the JOLs, and to provide such assistance as may be appropriate so that the JOLs may exercise in Hong Kong the powers bestowed on them by Cayman law and the Supervision Order[24].

21.  In the Letter of Request, the Cayman Court confirmed that:

  (1)   Pursuant to the Supervision Order, the JOLs have the powers prescribed in Part II of the Third Schedule to the Act, which are exercisable without sanction of the Cayman Court; and they have also been granted, without the need for further sanction or intervention from the Cayman Court, the power to:

(a)   exercise all the powers set the powers set out in Part I of the Third Schedule to the Act;

(b)   take any such actions as may be necessary or desirable to obtain recognition of their appointment;

(c)   take control of and, where the JOLs consider it appropriate to do so, take such steps as may be necessary to liquidate and/or wind up any of the Company’s subsidiaries;

(d)   make any compromise or agreement with creditors and debtors of the Company;

(e)   appoint counsel, attorneys, professional advisers as they may consider necessary to advise and assist them in the performance of their duties in accordance with Companies Winding Up Rules Order 25;

(f)   engage staff to assist them in the performance of their functions;

  (2)   pursuant to s.138 of the Act, the Cayman Court may require any person in possession of any property or documents to which the Company appears to be entitled, to pay, transfer or deliver such property or documents to the JOLs;

  (3)   the application for recognition and assistance is to enable the JOLs to exercise the powers bestowed on them by the Cayman Court in the jurisdiction of Hong Kong given that the JOLs have identified assets of the Company located in Hong Kong assets which include:

(a)   Cash of US$1,840.89 and HK$0.62 maintained with DBS;

(b)   4,055,200 shares in ListCo (i.e. Withdrawn Shares);

(c)   Residual cash and securities totalling approximately HK$33,000 held with GFS and Guotai; and

(d)   Potential claims against third parties in Hong Kong in respect of (i) the US$42 million outstanding principal and interest against the borrowers and guarantors under the loan agreements governed by Hong Kong law; (ii) the Company’s directors, one of whom is the sole director of the Investment Manager; (iii) PwC whose member firm in Hong Kong performed the majority of the audit work; and (iv) Bolder whose Hong Kong office performed the majority of the administration function. 

22.  The evidence before the court confirms that the Company still has assets held by DBS, GFS and Guotai and various third parties discussed above have in their possession documents and records relating to the Company’s assets and their dealings in the past[25], but not all of them have complied with the requests made by the JOLs. 

Discussion

23.  The source of the court’s power to recognise and assist foreign liquidation and liquidators appointed by the foreign court derives from common law.  As explained in Re USUM Investment Group Limited [2026] HKCFI 1320 §§53-54:

  (1)   Recognition and assistance are conceptually distinct.

  (2)   Recognition of the fact of a foreign office-holder’s appointment and his powers over the company’s affairs is a matter of ordinary private international law principle.  Provided the relevant criteria are satisfied in relation to the office-holder’s appointment, his ability to act as such within Hong Kong is not dependent on his first obtaining an order from the Hong Kong court.  An order for recognition is  confirmatory in nature for the benefit of third parties in Hong Kong with whom the office-holder may have to deal.

  (3)   On the other hand, assistance refers to the grant of specific power by the domestic court in furtherance of the office-holder’s functions.   

24.  The criteria for recognition and assistance have been summarised in Re USUM at §59(1)-(2):

“(1) The court may recognize the appointment of a foreign insolvency office-holder where:

(a) The foreign proceedings are collective insolvency proceedings;

(b) The foreign proceedings are conducted in the jurisdiction of the company’s place of incorporation or where its [centre of main interest] is located; and

(c) Recognition is not barred on grounds of public policy, fraud or breach of natural justice, or the enforcement of foreign penal or revenue laws.

(2) The court may grant assistance to a foreign insolvency office-holder where:

  (a)   The appointment of the foreign insolvency office-holder is recognised under Hong Kong law;

  (b)   The power which the office-holder invites the court to exercise or confer is of a nature which the court has recognised at common law or which is proper for the court to exercise having regard to the proper exercise of the judicial function;

  (c)   The order sought is one which can be made under the law by which they were appointed;

  (d)   The assistance is necessary for the administration of the foreign winding-up or the performance of the office-holder’s functions; and

  (e)   The order sought is consistent with the substantive law and policy of the Hong Kong court.” 

25.  Each of the requirement for recognition (§1 of the Order) is satisfied. 

26.  First, the liquidation of the Company has all the characteristics of a collective insolvency proceeding and has been conducted for the benefit of the creditors as a whole. Although the liquidation commenced as members voluntary liquidation, no declaration of solvency was filed.  By the Supervision Order, the liquidation has been converted into liquidation conducted under the supervision of the Cayman Court, and the JOLs were appointed by the Cayman Court. While the Company is a segregated portfolio company, it  remains a separate legal entity and has its own assets and liabilities separate and distinct from the assets and liabilities of SP1 and SP2.   

27.  Second, the liquidation of the Company has been commenced and conducted in the jurisdiction of the Company’s place of incorporation.  By virtue of their appointment under the Supervision Order, the JOLs have all the powers prescribed in Part I and II of the Third Schedule to the Act as well the powers conferred on them by the Supervision Order.  They are the only persons who have authority to act in the name and on behalf of the Company, whether within or outside the Cayman Islands.

28.  Third, there is no public policy concern which may bar this Court in granting an order recognising the liquidation and the appointment of the JOLs. 

29.  The requirements for the order for assistance (§2 of the Order) are also met.   

30.  First, the powers sought by the JOLs in the application (§2(1), (2), (4), (5) below) are based on the powers set forth in the Letter of Request, which the Cayman Court confirmed are the powers bestowed on the JOLs. 

31.  As regards the power to obtain information and documents relating to the Company from third parties in Hong Kong (§2(3) below), such power is one which the domestic court has power to grant under common law, and has regularly been granted by the court for the purpose of assisting a foreign office-holder to carry out their functions in Hong Kong (Re USUM §47).  The order sought is also one which can be granted by the Cayman Court under s.138 of the Act (see §21(2) above).

32.  Second, the assistance sought is necessary to assist the JOLs in performing their functions in Hong Kong for the following reasons:

  (1)   The third parties having possession of the Company’s assets viz, DBS, GFS and Guotai, have refused to hand over the assets without a recognition order granted by the Hong Kong court. 

  (2)   The third parties having possession of the Company’s books and records and documents relating to the Company have either failed to hand over all the books and records (in the case of Bolder) or failed to provide the documents sought by the JOLs (in the case of Mr Li).  It is necessary for this Court to grant the order sought by the JOLs so that if they continue to refuse to hand over the documents, the JOLs may seek a further order from the court to compel them to produce the documents. 

  (3)   None of the debtors and guarantors which are liable to repay the loans and interest due and payable to the Company, has paid the amount due.  There are other potential claims identified by the JOLs which may require legal proceedings to be commenced against the third parties concerned.  While the JOLs can commence legal proceedings in the name of the Company without a recognition and assistance order made by this Court, given the substantial amount owed and the number of parties involved, it is likely that one or more of these parties may challenge the authority of the JOLs to act in the name of the Company in the legal proceedings commenced against them.  It would be expedient and cost effective for this Court to make an order confirming the status and authority of the JOLs so that they do not need to incur further time and costs in proving their authority in any such legal proceedings. 

33.  Lastly, the Order granted is consistent with the substantive law and policy of the Hong Kong court.

 

Schedule

1.   The appointment of Mr Russell Smith of BDO CRI (Cayman) Ltd, 3^rd Floor, Century Yard, Cricket Square, Elgin Avenue, PO Box 31229, Grand Cayman, Cayman Islands and Mr Yeo Boon Ann (also known as Kenneth Yeo) of BDO Financial Services Limited, 25^th Floor, Wing On Centre, 111 Connaught Road Central, Hong Kong, as joint and several official liquidators (“JOLs”) of Regan Global All Weather Strategy Fund SPC (in Official Liquidation) (“Company”) pursuant to the Supervision Order dated 16 June 2023 be recognised by this Court;

2.   The JOLs have and may exercise in the Hong Kong Special Administrative Region the following powers for the purpose of carrying out their functions as JOLs of the Company:

  (1)   to request and receive from third parties documents and information concerning the Company;

  (2)   to locate, protect, secure and take into their possession and control all assets and property within the jurisdiction of this Court to which the Company is or appears to be entitled;

  (3)   to locate, protect, secure and take into their possession and control the books, papers and records of the Company, including the accountancy and statutory records within the jurisdiction of this Court, and to investigate the assets and affairs of the Company.  The books, records and documents of the Company include:

(a)   emails exchanged and other correspondence between the Company and its auditors, and the Company and other third parties; and

(b)   documents and information provided by the Company to its auditors and provided by the auditors to the Company in relation to the audit work;

  (4)   to bring legal proceedings and make applications to this Court, whether in their own names or in the name of the Company;

  (5)   to retain and employ barristers, solicitors or attorneys, accountants and/or such other agents or professional persons as the JOLs consider appropriate for the purpose of advising or assisting in the execution of their powers and duties under this Order;

3.   Anything that is authorised or required to be done by the JOLs may be done by all or any one of them; and

4.   There be general liberty to apply.