Credit Lyonnais is free to enforce an US$8 million debt owed by SK Global Hong Kong after an appeals court yesterday lifted a 'virtual chapter 11' of the South Korean company. Other foreign creditors are, however, poised to take steps to liquidate the Hong Kong arm of the fraud-ridden conglomerate should Credit Lyonnais attempt to seize assets and effectively steal a march on debt recovery. The Court of Appeal sided with Credit Lyonnais over a previous ruling that granted SK Global Hong Kong breathing space to work out a restructuring with foreign creditors. Reasons for yesterday's decision will be given at a later date. Credit Lyonnais had argued that no Chapter 11 regime existed in Hong Kong and it should thus be allowed to enforce an US$8 million judgment against SK Global Hong Kong. The bank said it had yet to make a decision over its next course of action. Xavier Roux, who heads Credit Lyonnais' commercial banking unit for Asia, said: 'Pleased is not the word. Satisfied is correct. There is a lot of money at stake everywhere ... a lot of principles. 'We are going to discuss all the options. We will take into account the fact that the coming weeks are sensitive times. There are negotiations right now between the Korean banks and the foreign creditors, so we have to take this into account.' Domestic creditors of SK Global have provisionally agreed to put the oil trading firm under court receivership. This will be put to a vote of all creditors on Friday. According to a source close to the foreign banks, a restructuring is still on the cards. 'We have been communicating through advisers. What the advisers are doing is to bridge the gap,' he said. Should Credit Lyonnais try to enforce its judgment, foreign banks will file a winding-up petition in Hong Kong to freeze the situation. 'It's unfortunate. It may interfere with the negotiations,' a source close to the creditors said. The petition would not be a fait accompli and could be withdrawn at any time.