SIP Amendments for New Scottish Insolvency Rules
This article forms part of a series looking at the significant changes to insolvency procedures being brought in in Scotland from 6 April 2019. In this article, David Menzies looks at the changes being made to the Statements of Insolvency Practice (SIPs).
The Insolvency (Scotland) (Company Voluntary Arrangements and Administration) Rules 2018 (ISCVAAR 2018) and the Insolvency (Scotland) (Receivership and Winding Up) Rules 2018 (ISRWUR 2018), together the Insolvency Scotland Rules 2018, significantly change how decisions are made in insolvency procedures. As a result, amendments are required to be made to several SIPs, which set principles and key compliance standards with which Insolvency Practitioners are required to comply, to ensure that these reflect changes to the corporate insolvency procedures and processes.
Statement of Insolvency Practice 6 - deemed consent and decision procedures in insolvency proceedings
The Joint Insolvency Committee (JIC) has approved a revised version of statement of insolvency practice 6 (SIP 6) which was introduced in April 2017 to coincide with the Insolvency (England and Wales) Rules 2016 and updated effective 1 January 2018.
The revised version has been amended only to remove reference to England and Wales in order that the SIP will also apply to corporate insolvency procedures for Scottish registered companies following the introduction of the Insolvency (Scotland) (Company Voluntary Arrangements and Administration) Rules 2018 and the Insolvency (Scotland) (Receivership and Winding Up) Rules 2018 (the 2018 Rules).
The revised SIP 6 will replace the current version of SIP 6, effective 6 April 2019.
Please note that the SIP does not apply in Northern Ireland and also does not apply to Scottish registered LLPs or special insolvency regimes.
SIPs 8, 10 and 12
As a consequence of the introduction of the 2018 Rules, SIP 8 (Conduct of meetings of creditors held pursuant to s98 Insolvency Act 1986), SIP 10 (Proxy forms) and SIP 12 (Records of meetings) will be withdrawn from 6 April 2019 in respect of Scottish corporate insolvency procedures.
SIPs 8, 10 and 12 will remain in force in respect of Scottish LLPs and special insolvency regimes which are not covered by the introduction of 2018 Rules and remain under the Insolvency (Scotland) Rules 1986 and other secondary legislation.