For many investors, investing in shipping funds was a flop. In addition to financial losses, reclaiming distributions by insolvency administrators may also loom over them.
Shipping funds were long considered high-yield and safe investments, and therefore enjoyed great popularity among investors. However, after the financial crisis in 2008, many things changed and numerous shipping funds went into insolvency. Investors suffered significant financial losses. They cannot yet close the chapter on failed investments, as insolvency administrators could approach investors with claims to recover received distributions.
As the commercial law firm MTR Rechtsanwälte explains, investors can often defend themselves against claims by insolvency administrators, as there is a lack of legal basis for the claims.
Although the insolvency of the fund company in many cases led to the revival of partner liability, and the insolvency administrator can reclaim distributions that have already been received. However, this only applies if the distributions were made independently of profits and the insolvency estate is insufficient without the repayment to satisfy the creditors’ claims. Furthermore, the statutes of limitations must be considered when reclaiming distributions. The start of the limitation period may occur as soon as the insolvency was determined, possibly even before the fund company’s insolvency proceedings began.
If the fund company demands the repayment of already received distributions from investors, this is only possible if it is clearly and understandably formulated in the company’s agreement that the distributions are merely loans that can be reclaimed if necessary.
After shipping funds were long considered a burnt investment form for private investors due to numerous insolvencies, they have recently experienced something of a renaissance. However, global economic and political developments, such as the Ukraine war, can also lead to renewed problems with shipping funds.
Other risks associated with shipping funds include, for example, the difficult tradability of shares and, in particular, the risk of total loss for investors. If they were not properly informed about the existing risks during advisory sessions, investors may have incurred claims for damages.
Experienced attorneys in capital market law provide counsel.
