Stay and mediation on Puerto Rico’s central debt extended

Bonds

Puerto Rico bankruptcy judge Laura Taylor Swain extended the mediation and stay periods for Puerto Rico’s central government debt by about a month.

Swain issued her order Friday afternoon in Puerto Rico District Court.

Mediation Team Leader Barbara Houser said that mediation has recently been “productive” and should be given more time.

On Dec. 23 Mediation Team Leader Barbara Houser described the ongoing mediation talks as being “productive.” She said that many participants would be away in late December and early January and thus not able to participate in those periods. She said if the parties reached further progress, she would have to add other parties to the discussions. Coming to an agreement would take additional time.

She asked Swain to give the process more time.

In response, on Friday Swain extended the deadline for the team to submit a report to Feb. 10 from Jan. 10. She extended the planned hearing on the report and any possible further extension of the stay on litigation to March 4 from Jan. 29.

Swain also extended the stay on litigation to March 11 from Jan. 31.

At issue are the commonwealth general obligation, Highways and Transportation Authority, and Public Buildings Authority bonds.

The Puerto Rico Oversight Board and other stakeholders have been in confidential mediation since late July. Swain had frozen litigation over issues like the bonds’ validity and secured status, the treatment of the bonds under the U.S. constitution, and whether the elected local government’s assent to any agreement is legally required.

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