Insolvency Technical Update June 2017

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david-menzies By David Menzies, Director of Insolvency

3 June 2017

Insolvency technical update – Your round-up of recent developments in insolvency

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Recast EU Insolvency Regulation

The majority of the Regulation (EU) 2015/848 (the Recast EU Insolvency Regulations) came into force on 26 June 2017. The Recast Regulation will apply to insolvency proceedings opened after that date. A helpful overview of the recast regulation is available from LexisNexis PSL.

Recast EU Insolvency Regulation – UK legislation

To give effect to the Recast EU Insolvency Regulations within UK insolvency legislation the following regulations also came into effect on 26 June 2017:

The Insolvency Amendment (EU 2015/848) Regulations 2017 – amending legislation in England and Wales and the non-devolved insolvency processes in Scotland

The Insolvency (Regulation (EU) 2015/848) (Miscellaneous Amendments) (Scotland) Regulations 2017 and Act of Sederunt (Rules of the Court of Session 1994 and Sheriff Court Rules Amendment) (Regulation (EU) 2015/848) 2017 amending within Scotland the devolved areas of personal insolvency and receivership.

ICAS Trust Deed style

A revised ICAS Trust Deed style to take account of the recast EU Regulation has been issued to existing holders of the ICAS Trust Deed Style Licence. A licence to use the ICAS Trust Deed Style is available free of charge to ICAS regulated Insolvency Practitioners and on payment of a small fee to others. Please contact David Menzies to request a licence.

Persons with Significant Control

The Scottish Partnerships (Register of People with Significant Control) Regulations 2017 came into effect on 26 June 2017 and require information on Persons with Significant Control (PSC) to be recorded at Companies House in the same manner as other UK corporate entities. The change comes in part of other changes to the PSC regime to comply with the European Fourth Money Laundering Directive. A helpful summary of the changes is available here (via Lexology)

Redundancy support for businesses and individuals in Scotland

Information on how to access PACE (Partnership Action for Continuing Employment) services to support Scottish employers and employees facing redundancy is available here. PACE support is available where redundancies of less than 20 are envisaged as well as larger redundancy situations where HR1 notification would be required.

Dear IP 77

The Insolvency Service have issued Dear IP 77. This contains information on requesting a decision making process when the OR is the liquidator, third party monies and the ISA Account, amendments to Companies House forms, advice for office holders dealing with animals, notification in consumer retailer insolvencies of chargeback arrangements and other matters.

Dear Trustee

The Accountant in Bankruptcy has issued a Dear Trustee letter reminding trustees that the cost of an application to the AiB for a decision may only be claimed as an outlay of the estate where this has been requested and approved as part of the application.

Common Financial Tool – Bursaries

The Accountant in Bankruptcy has issued a statement that they are changing their CFT guidance in relation to bursaries. The guidance issued is now to the effect that a contribution can be taken from bursary income. Notwithstanding the view expressed by the AiB, it is recommended that consideration should be given to the terms and conditions of any bursaries to which a debtor is entitled to identify whether there are any restrictions on its use which would mean that it would be inappropriate for the bursary to be used to meet a Debtor Contribution Order.

DAS Digest

The AiB have issued their spring edition of DAS Digest. The edition includes information on the new DAS website, DASH, and DAS case reviews.

Guidelines for Communication and Co-operation between Courts in Cross-Border Insolvency Matters

The High Court in England and Wales have adopted guidelines approved by the Judicial Insolvency Network designed to encourage and enhance communication between courts where parallel insolvency proceedings have been commenced in different jurisdictions. Further information is available here (via Lexology)

The Reporting on Payment Practices and Performance Regulations 2017

The above regulations came into force on 6 April and impose a duty on the UK’s largest companies and LLPs to report on a half-yearly basis on their payment practices, policies and performance for financial years beginning on or after 6 April 2017. Further information is available here.

Consultation on Code of Ethics for Insolvency Practitioners

The Joint Insolvency Committee (JIC) is consulting on a revised version of the Code of Ethics applicable to insolvency practitioners. The consultation closes on 25 July 2017.

Topics

  • Insolvency
  • Legislation

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