Schedule 2 of the Insolvency Rules 2016 sets out many transitional measures including those affecting pre 6 April 2010 liquidations that follow administrations. This article sets out some of the transitional measures more likely to affect insolvency practitioners in early April 2017.
The Insolvency Rules 2016 (IR2016) revoke all previous insolvency rules from the Insolvency Rules 1986 to the Insolvency (Amendment) Rules 2016. The Insolvency Rules 2016 replace all 29 earlier rulings, meaning that the Insolvency Rules 2016 will apply to all insolvency appointments after 6 April 2017 whether or not the date of appointment was after 6 April 2017, the commencement date for the Insolvency Rules 2016.
Transitional measures are in place for insolvency appointments where the relevant date was before 6 April 2017 (Schedule 2 IR2016). The transitional measures are detailed and have been drafted to cover a multitude of eventualities so you should refer to Sch2 IR2016 for specific information.
You can access the Insolvency Rules 2016 on http://www.legislation.gov.uk/
The following transitional measures are most likely to affect office holding insolvency practitioners:-
Opting out, Sch 2(2) IR2016.
IR1.39 requires an officeholder to notify creditors of the opting out option and procedure in the first communication after appointment. IR1.39 does not apply if the first communication with creditors was before 6 April 2017 although the officeholder may still choose to send creditors information about the opting out procedure. If you are expecting an appointment in late March 2017 you should consider the timing of the first communication with creditors to ensure compliance with the appropriate Rules.
Creditors' meetings, Sch 2(5) IR2016.
If a creditors' meeting is to be held on or after 6 April 2017 as a result of a notice sent out before 6 April 2017 then that meeting may still go ahead as planned. S246ZE(2) IA1986 means that physical creditors' meetings may only be called after 6 April 2017 if requested by at least 10% in value of creditors but if notice of a physical meeting was sent before 6 April 2017 then it may still be held after 6 April 2017. If you know that you will have to hold a creditors' meeting in early April 2017 you would avoid the complexities of the new decision procedures by calling the meeting before 6 April 2017.
Similar transitional measures for final meetings are in place under Sch 2(6) IR2016.
Statements of affairs, Sch2(4) IR2016.
The sections of IR2016 relating to statements of affairs in administration, bankruptcy and liquidations (IR3.28 - 3.34, IR10.56 - 10.59 and IR6.3 - 6.7 respectively) do not apply where the relevant proceedings began before 6 April 2017.
The following sections of the Insolvency Rules 1986 (R1986) regarding statements of affairs will still apply where the relevant proceedings began before 6 April 2016:- R2.28 - 2.32 administration, R4.32 - 4.42 liquidation, R6.58 - 6.72 bankruptcy.
The RMCSC Insolvency Guidelines have been updated for the Insolvency Rules 2016 and now include Guidelines for members' voluntary liquidations as well as administrations, creditors' voluntary liquidations, compulsory liquidations, bankruptcies and individual voluntary arrangements. Preview copies of the RMCSC Insolvency Guidelines are available on the RMCSC website so you can review these comprehensive insolvency manuals for yourself on the following page RMCSC Guidelines.
Caroline Clark's insolvency career started over 30 years ago and since 1994 she has specialised in insolvency compliance and regulation.