Should Pensioners Trump Creditors?

Burns, Mairin
April 2003
Investment Dealers' Digest;4/28/2003, Vol. 69 Issue 17, p12
Trade Publication
Bankrupt Air Canada Ltd. is now facing the possibility of having to pay off its pensioners before its creditors when it emerges from bankruptcy protection in May 2003. Canada's federal pension regulator, the Office of the Superintendent of Financial Institutions (OSFI), said in April 2003, that it is seeking to have pension payments made the firm's top post-bankruptcy priority. &ldquo.OSFI believes that federal pension legislation requires that amounts due or accrued to the pension plans are not subject to the Companies' Creditor Arrangement Act restructuring proceedings, and that such amounts would therefore move ahead of the other creditors, &rdquo. said OSFI head Nick LePan in a statement.


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