A new set of modernised and consolidated insolvency rules are due to come into force on the 6th April this year. The rules which have been approved by the Insolvency Rules Committee are being introduced to replace the Insolvency Rules 1986 and their 28 subsequent amendments. These rules will on be implemented throughout England and Wales with a parallel project set to modernise the Scottish insolvency rules currently underway with the Scottish Government.
The new rules will enable electronic communications between insolvency practitioners and creditors, where under the 1986 Rules an insolvency office holder was not allowed to use email as a form of communication without first obtaining the creditor’s written consent. This was stated as the biggest barriers in insolvency by stakeholders. The automatic requirement to hold physical creditors meetings will also be abolished, the new rules will specify what types of alternative decision making processes can be used, although the option for creditors to request meetings will remain. There will also be an introduction of an opt out for creditors who do not want to receive further correspondents on a case that they no longer have interest in.
The Insolvency Practitioners Association and ICAEW have been holding a number of roadshows to help the insolvency profession prepare for the new rules. At LegalinX-7Side, we offer a range of Insolvency checks to be undertaken on individuals or companies, ensuring you and your client are fully aware of the standing of the person/company you are in transaction with. These checks are of the upmost of importance and failure to undertake them has seen some solicitors being found negligent. For further information on our Insolvency check services take a look at our Court Services page.