Commonwealth Plan of Adjustment becomes effective

On March 15, 2022, counsel for the Financial Oversight and Management Board, as representative of the Title III debtors, filed the notice of entry of the order confirming the Modified Eighth Amended Title III Plan of Adjustment of the Commonwealth of Puerto Rico and of the occurrence of the Effective Date.

According to the notice (ECF), the Plan’s Effective Date occurred on March 15, 2022 and the Plan was substantially consummated. The Confirmation Order is dated January 18, 2022 [ECF No. 19813]; the modified Plan, January 14, 2022 [ECF No. 19784]. Confirmation in January is not the same as Effective Date in March: the plan takes effect when effectiveness conditions are met, not on the day of the confirmation order.

The document sets the deadline to file Administrative Expense Requests as June 13, 2022, with exceptions (among others: claims with a court order or written consent of Government Parties, Professional Claims, intergovernmental claims, certain IRS claims, ordinary-course expenses through the Effective Date, matters under the ACR Order, or pending 503(b) motions at confirmation). Requests must be received at Prime Clerk by 5:00 p.m. (Atlantic) that day; anyone required to file who fails is barred from claiming against the Debtors and Reorganized Debtors.

It also recalls that if rejection of an Executory Contract or Unexpired Lease causes damages and there is no prior proof of Claim, the claim is barred unless a proof of Claim is filed within 30 days after the later of the Effective Date and the order authorizing that rejection.

The notice does not rewrite haircut tables, New GO Bond amounts or creditor-disbursement calendars: it only notices prior confirmation, Effective Date, substantial consummation and deadlines. Effective Date is not automatic disbursement of every distribution the Plan contemplates.