The New Insolvency rules.
12th April 2017
As of 6th April 2017 The Insolvency Rules 2016 came into force. The new Rules replace the Insolvency Rules 1986 and all their 28 amendments.
The rules have been redrafted to properly reflect modern business practices and to make the insolvency process more efficient.
The differences include:
- Allowing electronic communications with creditors
- Ending the automatic requirement to hold physical creditors meetings, although creditors will be able to request meetings
- Allowing creditors to opt out of further correspondence and for small dividends to be paid by the office holder without the need for formal claim from the creditors
- new provisions allowing an officeholder to treat small debts as proved
- The automatic appointment of an Official Receiver as first trustee immediately upon the making a bankruptcy order
- removing the requirement for the Official Receiver to summon a creditors meeting
The 2016 Rules have also removed the use of statutory forms for insolvency proceedings (the rules now clearly prescribe the necessary contents of documents) in attempt to make them “future proof”.
Applications and petitions filed before the 6th April 2017 will continue to be governed by the 1986 Rules.
Statutory Demands:
Please note that statutory demands for bankruptcy are now issued under Part 10 of the Rules not Part 6. Statutory demand template forms have been amended to reflect this change
Please be aware that there is a new statutory demand form and a new petition for winding up for all actions after the 6 April 2017.
Certificates of service for winding up petitions, bankruptcy petitions and personally served statutory demands will now refer to whether service was effected before or after 16.30 hours, rather than 16.00 hours as previously.
Statutory demands served by letterbox will now need to specify the date on which it is believed the demand will come to the attention of the debtor, and this date will then be the deemed date of service.