statutory insolvency arrangement meaning

Where a scheme of arrangement, restructuring plan, company voluntary arrangement or individual arrangement is put forward in respect of a regulated firm (defined below), the Financial Conduct Authority (FCA) should be engaged at the earliest possible stage. The FCA serves as the conduct regulator for both financial services firms and for the financial markets across the United Kingdom. Under section 1B of the Financial Services and Markets Act 2000 (FSMA 2000), it is tasked with pursuing specified objectives, including one centred on consumer protection in practice. The FCA states its statutory aims as securing an appropriate level of protection for consumers and safeguarding and strengthening the overall integrity of UK financial markets, with the intention of limiting the volume of proposed compromises it deems unsuitable (see FG22/4 para 1.2). On 5 July 2022, the FCA issued guidance on compromises by regulated firms (FCA Guidance FG22/4 July 2022, updated January 2024), prompted by serious concerns that these mechanisms were being advanced and deployed by firms to sidestep redress due to customers...

When does a section 75 debt arise? An s 75 liability crystallises in respect of an occupational pension scheme that is underfunded on a buy-out basis and: an employment-cessation event happens for a relevant participating employer within a multi-employer scheme an insolvency event occurs in relation to a participating employer of the scheme, or the scheme formally goes into winding up In a multi-employer scheme, an employer’s s 75 debt is its allocated share of the scheme deficit, appropriately assessed on a buy-out basis. As an alternative to immediately paying the s 75 debt in full, an employer may enter into a deferred debt arrangement, an apportionment arrangement, or a withdrawal arrangement. Section 75 does not apply at all to money purchase schemes, unregistered pension schemes, unfunded public sector schemes, and a scheme with only one member. ...

THIS CHECKLIST APPLIES TO OCCUPATIONAL PENSION SCHEMES This checklist highlights the key actions involved in bringing an occupational pension scheme to a close—whether a defined benefit (DB) or defined contribution (DC) arrangement—and aligns with winding-up guidance from the Pensions Regulator (TPR). For fuller detail on these steps, see Practice Notes: Winding up a defined benefit (DB) occupational pension scheme; Winding up a defined contribution (DC) occupational pension scheme; and Winding-up an occupational pension scheme—statutory disclosure from 6 April 2014, reporting and record-keeping requirements. Data cleansing and reconciling records Once trustees decide to wind up the scheme, they should carry out a thorough data cleansing exercise. As this can be lengthy, it should, where practicable, be completed before formal winding-up starts. Where trustees cannot control the timing of the wind-up, cleansing and planning should begin as early as possible within the winding-up process. As part of the data cleansing exercise, trustees should: Check and reconcile member records. Where the scheme is a former contracted-out...

Re VTB Capital plc (in administration) [2024] EWHC 2612 (Ch) What are the practical implications of this case? While the judgment does not spell it out, the application seems to have proceeded under paragraph 76(2)(a) of Schedule B1 to the Insolvency Act 1986 (IA 1986). VTB was not in special administration, and Schedule B1 to IA 1986 applied, subject only to the modifications introduced by the Credit Institutions (Reorganisation and Winding up) Regulations 2004. There is no statutory cap on the duration of any extension a court can grant under IA 1986, Sch B1, para 76(2)(a); the appropriate period is fact-sensitive. Any period requested should represent a credible, principled estimate of the time required to meet the administration’s purpose—for instance, completing sales of residual assets or recovering sums due by instalments over a defined timeframe. The application should demonstrate creditor engagement and set out why the remaining tasks cannot sensibly be carried out in liquidation, or why completing them within administration would produce a better outcome for creditors. Frequently,...

Restructuring & Insolvency weekly highlights—18 April 2024 In this issue: Insolvency litigation Personal insolvency The office-holder Restructuring Corporate insolvency processes Directors and insolvency Property insolvency Daily and weekly news alerts Key dates for R&I professionals New content New Q&A Insolvency litigation New Practice Note—Transactions at an undervalue under section 238 of the Insolvency Act 1986 The LexisNexis Restructuring & Insolvency practical guidance team has issued a new Practice Note, ‘Transactions at an undervalue under section 238 of the Insolvency Act 1986 (IA 1986)’. It reviews section 238, the conditions to satisfy, the statutory defence, initiating a claim, possible relief, protections for third parties, limitation and assignment of claims. See News Analysis: New Practice Note—Transactions at an undervalue under section 238 of the Insolvency Act 1986. Director who concealed trading accounts liable for fraudulent trading and misfeasance (Thiel-Czerwinke v Crabb) The liquidators of Courtside Recycling Ltd (Company) succeeded in a...

In this issue: Residential tenancies Repairing obligations and dilapidations Enforcing security and property insolvency Disputes and remedies Key developments and horizon scanning Additional Property Disputes updates LexTalk® Property Disputes: a Lexis®Nexis community Daily and weekly news alerts Dates for your diary Residential tenancies An end to unmeritorious tenancy deposit claims (Lowe v The Governors of Sutton’s Hospital in Charterhouse) The Court of Appeal in Lowe v The Governors of Sutton’s Hospital in Charterhouse [2025] EWCA Civ 857 upheld the refusal of a substantial claim under the tenancy deposit regime. The central question was whether a prescribed information certificate that, first, contained a mistake and, second, lacked a signature nevertheless complied with section 213 of the Housing Act 2004 (HA 2004) and the related 2007 Order. Applying the Mannai principle and adopting a purposive reading of the statutory scheme, the court held that the certificate was sufficient to meet those requirements. This...

This Practice Note sets out the principal steps for properly bringing to an end a defined contribution (DC) occupational pension scheme—also described as a money purchase occupational pension arrangement or a trust-based defined contribution plan. Throughout this Practice Note, this type of arrangement is termed a ‘DC scheme’. The guidance applies across a range of DC schemes, including trusts that sit outside the authorised master trust framework and small self-administered pension schemes (SSASs), although the latter may, in certain cases, be excluded from particular statutory obligations or requirements. This Practice Note does not cover the winding-up of any: an ‘authorised master trust’ under the Pension Schemes Act 2017 (PSA 2017)—for further detailed information, please see Practice Note: The authorisation and supervisory regime for master trusts, contract-based DC arrangements (eg group personal pension arrangements)—for further details and guidance, see Practice Note: Winding up of personal pension schemes Statute makes distinct and specific provision for hybrid schemes (combining defined benefit (DB) and DC...

Liquidation Following enforcement of security by fixed charge creditors for their own benefit, the order of distributions in a winding up is: if liquidation commences within 12 weeks of a moratorium, any unpaid moratorium debts and ‘priority pre‑moratorium debts’ to which no payment holiday applied during the moratorium expenses properly incurred in the winding up (including the liquidator’s remuneration) ordinary preferential debts secondary preferential debts the prescribed part for unsecured creditors (where not disapplied) debts secured by floating charges unsecured debts statutory interest postponed debts (i.e. non‑provable liabilities) return of any surplus to members (subject to adjustment between members) For further details, see Practice Note: Waterfall of payments in liquidation...

This Practice Note covers: the impact of an insolvency process on ongoing litigation where the debtor, bankrupt or insolvent company is a claimant or defendant how an insolvency process interacts with an arbitration agreement binding the debtor, bankrupt or insolvent company additional considerations in a cross-border setting Personal insolvency What happens when the bankrupt is a claimant in ongoing proceedings? The presentation of a bankruptcy petition, whether by a creditor or by the debtor, has no legal consequence for proceedings already on foot where the debtor is the claimant. Once a bankruptcy order is made and a trustee in bankruptcy (the trustee) is appointed, most causes of action in which the bankrupt has an interest vest in the trustee under section 306 of the Insolvency Act 1986 (IA 1986). In such circumstances, it is the trustee, rather than the bankrupt, who has standing to carry on the claim. The trustee will proceed only if that course best serves the interests...

The Practice Statement for schemes and RPs 2025 From 1 January 2026, the Practice Statement for schemes and RPs 2025 sets out the procedure for Part 26 schemes of arrangement (schemes; see Practice Note: Schemes of arrangement—process and statutory framework) and for Part 26A restructuring plans (see Practice Note: Part 26A restructuring plans—process) between a company and its creditors and/or members (see: LNB News 19/09/2025 33 and Practice Note: The Practice Statement for Part 26 schemes and Part 26A restructuring plans (2025)). It captures all matters where an application for a meetings order is to be determined at a convening hearing listed on or after 1 January 2026; i.e. every application for a convening hearing fixed on or after 1 Jan 2026. Where a scheme is already underway and its convening hearing occurred before 1 January 2026, it appears the 2020 Practice Statement will continue to apply...

Court Reference No: [ INSERT COURT REF. NUMBER ] [ IN THE HIGH COURT OF JUSTICE BUSINESS AND PROPERTY COURTS [OF ENGLAND AND WALES] [IN [ INSERT LOCATION ]] [INSOLVENCY AND COMPANIES LIST (ChD)] OR [IN THE COUNTY COURT AT [ INSERT LOCATION ] ] [BUSINESS AND PROPERTY COURTS LIST] OR [IN THE HIGH COURT OF JUSTICE [CHANCERY DIVISION ] ] IN THE MATTER OF [ INSERT COMPANY NAME ]IN THE MATTER OF THE INSOLVENCY ACT 1986 Proposal for a Company Voluntary Arrangement This document, advanced by the Company’s directors, is drawn up pursuant to [ Part I Insolvency Act 1986 and in accordance with the provisions of Parts 1 and 2 of The Insolvency (England and Wales) Rules 2016 ]. To: [ insert addressee eg the Nominees ]Dated [ insert date ] 1 Interpretation 1.1 [ Insert definitions ]. 1.2 Any reference to a paragraph is a reference to a paragraph within this proposal. 1.3 Headings appear solely...