Esprit Global (00330) has sought legal advice on the rationale for this legal process

Zhitong Finance App News, Esprit Global (00330) issued an announcement. The board of directors of the company recently learned that at the request of the bankruptcy trustee (trustee) of Esprit Europe B.V. (Esprit Europe), a writ of subpoena submitted to the Amsterdam District Court without any supporting documents has been delivered via email to the Company and Wancheng Resources Co., Ltd. (Wancheng Resources) (an indirect wholly-owned subsidiary of the Company).

According to the writ of subpoena, before Esprit Europe went bankrupt, Esprit Europe transferred its shares in Esprit (Holdings II) B.V., to Wancheng Resources, and the company was an indirect co-owner of several intellectual property rights. The book value of such shares was 56.48 million euros, and the purchase price was 10.2 million euros. The purchase price was offset by a portion of the shareholder loan provided by the Company to Esprit Europe and was borne by Wansheng Resources; and the transfer to the Company of a number of its intra-group claims on non-European group companies amounting to approximately EUR 28.2 million, and its various debts to non-European group companies, amounting to approximately EUR 11.3 million, to offset (among others) shareholder loans provided by the Company to Esprit Europe (approximately EUR 16.86 million). After completing these offsets, shareholder loan balances of more than 49 million euros remain unpaid.

The trustee alleges that these transactions harmed the interests of Esprit Europe's co-creditors, and requested that the Company and Wancheng Resources indemnify Esprit Europe co-creditors for losses suffered as a result of such transactions and bear the costs associated with such legal proceedings.

The Company has sought legal advice on the basis of this legal process and was informed that the Kingdom of the Netherlands is a jurisdiction listed in Schedule 2 of the Foreign Judgments (Mutual Enforcement) Ordinance (Chapter 319 of the Laws of Hong Kong) (the Ordinance). Therefore, the enforcement of any Dutch judgement is subject to the provisions of this regulation. However, under section 2 (2) of the Ordinance, foreign judgments involving the liquidation of a company are not covered by the Ordinance. For the above reasons, the trustee's claim in the Netherlands against Esprit Europe, which has already been liquidated, will not be enforceable in Hong Kong, so the claim was made without sufficient factual grounds.

The Company will actively take appropriate measures (including legal action) to protect the legitimate rights and interests of the Company and protect the interests of the Group and the Company's shareholders. As this legal process is still in its preliminary stages, there is still uncertainty about the final outcome of the lawsuit and the current or future financial impact of the legal process on the Group.