(Bloomberg) -- A Chinese court has imposed spending restrictions on beleaguered property developer China Evergrande Group and its founder Hui Ka Yan after the company failed to comply with payment obligations.
Under the order issued by the Guangzhou Nansha District People’s Court, both Evergrande and Hui are barred from spending in high consumption areas that are not “necessities of life or business,” according to an exchange filing on Tuesday. Chinese media outlet Guandian reported earlier that Hui had been hit with spending curbs before.
The restrictions are the latest episode in the wind-up process of the troubled Chinese developer after it was ordered to liquidate by a Hong Kong court in January. Evergrande’s offshore liquidators are still navigating a structural maze and thorny legal questions about their reach in mainland jurisdictions, where many of the firm’s assets are based. Last week, a Hong Kong judge adjourned a hearing on a petition to wind-up one of its units, giving the parties more time as the builder’s liquidators seek to seize key assets.
Evergrande amassed more than $300 billion of liabilities during China’s debt-fueled property boom, becoming the world’s most indebted developer in 2022. Shares of Evergrande have been suspended from trading since Jan. 29.
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