Insolvency Technical Update - February 2020
Insolvency technical update – Your round-up of recent developments in insolvency.
ICAS Code of Ethics
A revised and restructured Code of Ethics was introduced by ICAS on 1 January 2020. The new Revised and Restructured Part 5 of the 2020 ICAS Code of Ethics for Insolvency Practitioners has now been published along with an accompanying article. Part 5 is effective from 1 May 2020. Part D of the former Code (applicable from 1 January 2014) will continue to apply until that date, although earlier adoption of Part 5 is possible and encouraged.
A reminder that a series of articles covering the main changes to the Code of Ethics is available on icas.com. Of particular relevance to Insolvency Practitioners are the articles on the structure of the Code, an enhanced conceptual framework, Safeguards, Inducements (including gifts and hospitality) and Documentation.
Further articles looking at the changes specific to Part 5 will be issued over the coming weeks.
AiB 'Dear Trustee' letter
The AiB has issued a ‘Dear Trustee’ letter, which contains important information about how and when a trustee can submit a DCO proposal to the AiB when they are unable to obtain the co-operation of the debtor, and to advise trustees of the need to ensure a DCO is quashed, or has expired, prior seeking their discharge as trustee.
GDPR: personal data
A joint statement has been issued by the Financial Conduct Authority (FCA), the Information Commissioner’s Office (ICO) and the Financial Services Compensation Scheme (FSCS), warning insolvency practitioners and FCA-authorised firms to be responsible when dealing with personal data.
The Chancellor of the High Court has issued a guidance note clarifying the procedure to be used in the Business & Property Courts regarding the appointment of an administrator when an application is made electronically outside court hours. It is anticipated that these issues will be addressed by amendment to the Insolvency (England and Wales) Rules 2016 in due course.
Common Financial Statement trigger figure updates
Trigger figures within the Common Financial Statement, which is used as the Common Financial Tool for Scottish personal insolvency processes, have been updated and will become effective on 1 April 2020. The AiB has indicated that it will adopt a flexible approach for a period of one month after 1 April 2020 as a transitional arrangement for advisers updating their systems and processes.
Pension Protection Fund
The PPF has published updated information on when and how to make payments to them in relation to:
- dividends from insolvent estates;
- guarantee payments in respect of pension scheme employer liabilities; and
- loans notes in respect of restructuring deals.
Law on moveable transactions
The Economy, Energy and Fair Committee has launched a call for views on reform of the law on moveable transactions.
The Scottish Law Commission has examined the issue of moveable transactions. It published its final Report on Moveable Transactions (including a draft bill in volume 3) in 2017. The Economy, Energy and Fair Work Committee took evidence from several people involved in the Scottish Law Commission’s work on 26 November 2019. They argued that the law in this area needed updating, and Scotland’s businesses were suffering as a result. The Committee has agreed to look into this issue further and is inviting people to submit their views in writing.
The deadline for written responses is Friday 17 April 2020.
The Seafarers (Collective Redundancies, Information and Consultation and Insolvency Miscellaneous Amendments) Regulations (Northern Ireland) 2020
The above Statutory Rule came into effect on 26 January 2020, with an aim of placing those employed at sea on an equal footing with land based employees and to remove unequal treatment across EU Member States.
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