Energy lawsuits in Bermuda tend to fall into two distinct categories: cross-border insolvency proceedings involving Bermuda-incorporated oil, gas, and mining companies whose operations sit elsewhere, and domestic regulatory disputes over electricity rates and legislation. The insolvency cases have produced the most consequential rulings, because Bermuda’s Supreme Court has developed a “soft-touch” provisional liquidation practice that lets foreign restructurings proceed while Bermuda provides a statutory stay on local claims.
How Bermuda’s Soft-Touch Framework Works
Bermuda has no equivalent to U.S. Chapter 11 or UK administration. Instead, the Supreme Court uses the winding-up provisions of the Companies Act 1981 and the Companies (Winding-Up) Rules 1982 to appoint provisional liquidators with limited powers, leaving the board in place to run the business while a foreign court handles the primary restructuring.1Bermuda VLex. Re Matter of Energy XXI Ltd
The foundational precedent is Re ICO Global Communications (Holdings) Limited, a 1999 decision that first used Bermuda’s winding-up jurisdiction to protect the implementation of a foreign restructuring and established that Bermuda courts could recognize foreign liquidators as a matter of common law.2Supreme Court of the United States. Amicus Brief RISA, 19-277 The energy cases that followed built on that foundation, with the courts describing their role as “harmonisation of effort” between jurisdictions rather than any surrender of sovereignty.
For companies that incorporate in Bermuda for tax and corporate-law reasons but operate abroad, the practical result is a predictable cooperation model. Since January 1, 2025, Bermuda has imposed a 15% corporate income tax on multinational groups with revenues exceeding EUR 750 million, but the jurisdiction remains attractive for its established legal infrastructure and creditor-friendly insolvency framework.3Chambers. Bermuda Finance and Banking Law Practice Guide
Energy XXI: The Case That Shaped Current Practice
Energy XXI Ltd, a Bermuda-incorporated holding company operating oil and gas assets in the Gulf of Mexico, entered parallel proceedings in April 2016. On April 11, the company and 25 affiliates signed a Restructuring Support Agreement with noteholders. In the early hours of April 14, the group filed Chapter 11 in the U.S. Bankruptcy Court for the Southern District of Texas, and later that same morning Energy XXI Ltd presented its own winding-up petition in Bermuda, citing “liquidity issues.”4Government of Bermuda. Reasons Re Energy XXI Ltd
The company carried more than $3.6 billion in secured and unsecured debt across eight tranches.5SEC. Energy XXI Plan of Reorganization Press Release By the company’s own affidavit, equity holders were entitled to no recovery, since the valuation would have needed to be wrong by more than $2.2 billion for shareholders to see any return.4Government of Bermuda. Reasons Re Energy XXI Ltd
The day after the petition, the Bermuda Supreme Court appointed John McKenna of Finance and Risk Services Ltd as provisional liquidator with only soft-touch powers. The board stayed in place, and the Bermuda court explicitly designated the Texas court as the “primary restructuring forum” while its own role remained “ancillary.”1Bermuda VLex. Re Matter of Energy XXI Ltd
On August 15, 2016, Chief Justice Ian Kawaley issued a Recognition Order acknowledging the U.S. Chapter 11 plan and permanently staying all claims by creditors and shareholders within Bermuda’s jurisdiction. An Equity Committee appointed by the U.S. Bankruptcy Court had challenged the petition, arguing that the Bermuda court lacked jurisdiction to use winding-up provisions for restructuring purposes. The Chief Justice dismissed those arguments and ruled that using the winding-up provisions of the Companies Act 1981 to assist a foreign restructuring was a “perfectly proper use” of those provisions.6Conyers. In the Matter of Energy XXI Ltd
The court set one important limit. Recognition applied only to parties who had submitted to the Texas court’s personal jurisdiction or to property within that court’s in rem jurisdiction.6Conyers. In the Matter of Energy XXI Ltd
Energy XXI emerged from Chapter 11 on December 30, 2016, rebranded as Energy XXI Gulf Coast, Inc. The plan involved a debt-for-equity swap that eliminated roughly $3.6 billion in debt.7Yahoo Finance. Energy XXI EGC Acquired by Cox Oil Holders of $367 million in convertible notes received a cash distribution double what earlier plan proposals had offered.8Mintz. Energy XXI Bankruptcy: Holders Receive Cash Payout Holders of unsecured notes issued by the Gulf Coast and EPL subsidiaries received warrants for 3.6% and 2.4% of the new equity, respectively.9Justia. Energy XXI Second Amended Joint Chapter 11 Plan The reorganized company was later acquired by Cox Oil Offshore LLC for approximately $322 million; the deal closed on October 18, 2018.10Biz New Orleans. Gulf Coast Oil Company Announces Completion of Acquisition
C & J Energy Services: A 35-Day Bermuda Dissolution
The Energy XXI approach was applied even more aggressively for C & J Energy Services Ltd. On July 21, 2016, C & J and its Bermuda subsidiary petitioned for their own winding-up, and joint provisional liquidators were appointed the next day. The Bermuda court again took an ancillary role while the U.S. Bankruptcy Court for the Southern District of Texas handled the primary Chapter 11 for a group-wide restructuring of approximately $1.38 billion.11Government of Bermuda. Reasons for Recognition Order Re C & J Energy Services Ltd
The U.S. court confirmed the plan in December 2016 with support from more than 99.96% of creditors by value. The debt-for-equity swap extinguished all claims against the Bermuda companies, leaving them as empty shells.12Appleby. The Winding Up of C&J Energy Limited in Bermuda in 35 Days On February 23, 2017, the Bermuda court recognized the U.S. plan, granted a permanent stay on all claims, issued winding-up orders, and approved an accelerated liquidation process. The court dispensed with statutory requirements for creditor and contributory meetings, finding they served “no useful commercial or public purpose” given that all debts and equity interests had already been discharged.13Conyers. In the Matter of C & J Energy Services Ltd The Bermuda companies were dissolved 35 days after the winding-up orders.
Up Energy: When Restructuring Stalls
Not every Bermuda energy insolvency runs smoothly. Up Energy Development Group Ltd, a Bermuda-incorporated coal mining company listed in Hong Kong, defaulted on convertible notes exceeding HK$3.4 billion.14CMS. Hong Kong Court of Appeal Clarifies the Second Threshold Requirement for Winding Up Foreign Companies Creditors filed winding-up petitions in Hong Kong in March 2016 and in Bermuda in May 2016. The Singapore branch of Credit Suisse AG led the Bermuda petition over HK$150 million in unpaid convertible notes.15Government of Bermuda. Up Energy Development Group Ltd Judgment
The Bermuda court appointed joint provisional liquidators in October 2016 and adjourned the winding-up petition repeatedly to allow restructuring. By November 2018, progress had stalled, and Justice Shade Subair Williams issued “unless orders” requiring the provisional liquidators to convene a creditors’ meeting and file a final scheme of arrangement by fixed deadlines, failing which winding-up orders would take effect automatically.15Government of Bermuda. Up Energy Development Group Ltd Judgment
A scheme of arrangement was sanctioned by the Bermuda court in November 2019 but lapsed after the Hong Kong Stock Exchange’s decision to delist the company was upheld in May 2021, which prevented resumption of share trading by the required deadline.16Hong Kong Lawyer. Re Up Energy Development Group Ltd The Bermuda court finally ordered the company wound up in March 2022. A subsequent Hong Kong winding-up order from May 2022 was overturned by the Hong Kong Court of Appeal on June 16, 2025, on the grounds that the petitioner had not shown a “reasonable possibility” of benefit from a Hong Kong winding-up.14CMS. Hong Kong Court of Appeal Clarifies the Second Threshold Requirement for Winding Up Foreign Companies
Domestic Disputes: BELCO and the Regulatory Authority
Bermuda’s domestic energy litigation has centered on the Bermuda Electric Light Company (BELCO), which holds a monopoly on electricity transmission and distribution. BELCO challenged the Regulatory Authority’s decision to grant a 7.5% rate increase rather than the 16% it had requested. BELCO sought $478 million in allowed revenue with an 8.96% rate of return; the RA approved $454 million and a 7.16% return.17Regulatory Authority of Bermuda. The RA Saves Energy Consumers Up to $90 Million
Chief Justice Larry Mussenden dismissed all eight grounds of appeal in an 85-page judgment, holding that the RA’s rate-setting involved highly technical financial analysis to which the court should defer absent clear error.18Chambers. Bermuda Dispute Resolution
Legislative friction has continued. On June 12, 2026, the House of Assembly passed the Electricity Amendment Act 2026, granting the Minister of Home Affairs power to suspend the integrated resource planning process in the public interest. BELCO President Wayne Caines publicly opposed the changes, calling them “not necessary” and warning they introduce “the potential for ministerial interference into a process that is meant to stay independent.”19BELCO. BELCO Comments on Electricity Act Amendment As of mid-2026, BELCO has not filed a legal challenge to the new law.20Royal Gazette. BELCO: Electricity Act Change Risks Ministerial Interference