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Brazil’s fourth-largest airline, Avianca Brasil, filed for bankruptcy protection on Monday, saying its operations had been threatened by potential repossession of aircraft, which could prevent the carrier from continuing to operate, Reuters reported. The unlisted airline said in its bankruptcy filing that leasing companies seeking to take back some 30 percent of its all-Airbus fleet threatened its ability to fly some 77,000 passengers in December. Avianca said in a statement that the bankruptcy filing resulted from a failure to reach a “friendly agreement.” It also said its flights would not be affected. The aircraft are still under Avianca Brasil’s control for now and it remains unclear what their fate will be as the carrier is asking a Brazilian court to allow it to keep the planes for now. The airline said in the filing it largely blamed high fuel prices and a strong dollar for its troubles.

Servicos de Petroleo Constellation SA, a Brazilian oil-and-gas drilling company, filed for bankruptcy in the U.S. on Thursday to help it restructure nearly $1.5 billion in debt, WSJ Pro Bankruptcy reported. The company sought chapter 15 protection, the section of the bankruptcy code that deals with international insolvencies, in U.S. Bankruptcy Court in New York. Much of Constellation’s debt is governed by New York law, court papers show, and it has several bank accounts in New York. Foreign companies with ties to the U.S. often use chapter 15 to seek court recognition of their insolvencies. If approved by a U.S. judge, it acts much like chapter 11, halting lawsuits and preventing creditors from seizing U.S.-based assets. Read more.

Cover all aspects of the UNCITRAL Model Law on Cross-Border Insolvency as well as chapter 15 of the Bankruptcy Code with ABI’s Chapter 15 for Foreign Debtors. 

European Union lawmakers backed new rules today that would soften requirements on the money that banks must set aside to cover potential losses from new debt that turns sour, Reuters reported. The changes adopted by lawmakers in the economic affairs committee of the European Parliament will need approval from EU governments before they become law. They represent an easing of the requirements from a deal reached in October by EU governments, which in turn had softened an earlier European Commission proposal, and met with opposition in some quarters for being too lenient. In line with the compromise struck by EU states, parliamentarians backed a text that would require banks to fully provide for unsecured loans three years after they turn bad. The commission had proposed a two-year term. The date for the new requirements to enter into force will not be backdated to March 2018 as had been proposed by the commission, the text agreed by lawmakers said, in line with the compromise reached by EU states in October.

Ex-tennis champion Boris Becker has dropped his claim to have diplomatic immunity from bankruptcy, BBC.com reported. The three-time Wimbledon winner had said that his appointment as a Central African Republic (CAR) diplomat gave him protection from any legal claims. Declared bankrupt in 2017 over money owed to bank Arbuthnot Latham, he was being pressed for "further assets." After a hearing in London, Becker abandoned his case and his bankruptcy has been extended indefinitely. His withdrawal means a planned auction of his trophies and memorabilia will go ahead.

Beauty and home products retailer Crabtree & Evelyn Canada Inc. is closing its stores and has filed for bankruptcy protection, the Canadian Press reported. In Quebec court filings under the Bankruptcy and Insolvency Act, the company says that it plans to begin liquidating inventory, so it can distribute the proceeds to creditors. The company employs 123 full- and part-time employees in Canada and operates 19 stores, including 11 in Ontario, six in B.C. and one each in Alberta and Quebec. The company says it has experienced "significant losses," which it attributed to changing consumer demand, the rise of e-commerce and long-term declines in traditional retail traffic.

Conglomerate Ahmad Hamad Algosaibi and Brothers (AHAB) has become the first company to file for a settlement under Saudi Arabia’s new bankruptcy law, seeking to resolve the kingdom’s longest-running and largest debt dispute, Reuters reported. The company hopes the move will help to bring a conclusion to creditor talks that have rumbled on since AHAB and Saad Group defaulted on about $22 billion of debt in 2009. The law, which came into effect in August 2018, is the latest of the kingdom’s reforms aimed at attracting foreign investment and reducing the economy’s dependence on oil. AHAB said yesterday that it had petitioned the Commercial Court in Dammam for a protective settlement procedure under the law. The mechanism, similar to chapter 11 proceedings in the U.S., offers a cram-down provision, preventing minority dissenting creditors from blocking a settlement agreed by the majority.

A former Justice Department employee pleaded guilty on Friday to helping funnel tens of millions of dollars into the U.S. for the alleged mastermind of the multibillion-dollar fraud involving Malaysia’s sovereign-wealth fund, the Wall Street Journal reported. Some of the $74 million allegedly brought into the U.S. on behalf of Jho Low, a Malaysian businessman, was used to pay a prominent Republican fundraiser, court documents show. Low sought to use the funds to influence the Justice Department investigation into the fund, 1Malaysia Development Bhd, and other foreign lobbying activities, the documents said. George Higginbotham, who worked at the Justice Department as a senior congressional affairs specialist until August, pleaded guilty Friday to conspiring to make false statements to banks about the source and purpose of the funds to move them into the U.S. The Justice Department said Higginbotham played no role in the U.S. investigation, which led earlier this month to charges against two senior Goldman Sachs Group Inc. bankers along with Mr. Low. In addition, the Justice Department has filed civil-forfeiture lawsuits seeking to recover more than $1.5 billion in illicit assets accused of being tied to the alleged fraud. Higginbotham “failed to influence any aspect of the Department’s investigation of 1MDB,” the agency said.

Cash-strapped Brazilian construction firm Odebrecht Engenharía e Construção is analyzing options to restructure nearly $3 billion worth of bonds, after it missed a coupon payment this week that has bondholders prepping for significant losses on their investments, Reuters reported. OEC, implicated in a multinational corruption scandal that has impacted countries in Latin America and Africa, hired Moelis & Co. and law firm Cleary Gottlieb Steen & Hamilton on Monday to study potential restructuring alternatives after the company said it would skip an $11.5 million coupon payment due on a bond maturing in 2025. Possible solutions to address the bond debt include exchanging and extending maturities on OEC’s securities or rolling over shorter-term liabilities with bank loans, according to three sources monitoring the situation.

President Trump, days before a summit with China’s leader, said that he expects to move ahead with boosting tariff levels on $200 billion of Chinese goods to 25 percent, calling it “highly unlikely” that he would accept Beijing’s request to hold off on the increase, the Wall Street Journal reported. Trump suggested that if negotiations don’t produce a favorable outcome for the U.S., he would also put tariffs on the rest of Chinese imports that are currently not subject to duties. “If we don’t make a deal, then I’m going to put the $267 billion additional on” at a tariff rate of either 10 percent or 25 percent, Trump said. He first threatened those duties, and the higher tariffs on the initial $200 billion in goods, in late summer.