Foreign creditors face bankruptcy riddle in China

Hong Kong

AS China's economy slows and Beijing becomes more relaxed about letting its companies fail, a rising number of foreign bondholders risk being caught up in the country's unpredictable court system.

Last month, solar producer Baoding Tianwei Baobian Electric became China's first ever state-owned company to default on a bond coupon payment, showing Beijing's increasing willingness to let companies go bust in a bid to reform its corporate market.

Also in April, Kaisa Group became the first Chinese property developer to fail to pay a coupon on its US dollar bonds and Internet company Cloud Live Tech Group failed…