Jurisdiction(s):
United Kingdom

Key definition

Insolvency definition

What does Insolvency mean? In practice, insolvency describes a financial state where a debtor cannot meet liabilities when due, triggering remedies such as administration, liquidation or bankruptcy and informing directors’ duties and avoidance claims. For companies in England & Wales, Scotland and Northern Ireland, the Insolvency Act 1986, s 123 sets two alternative tests: - Cash‑flow insolvency: an inability to pay debts as they fall due. The inquiry is practical and forward‑looking, not confined to today’s bills (Re Patrick & Lyon Ltd [1933] Ch 786; BNY Corporate Trustee Services Ltd v Eurosail [2013] UKSC 28). - Balance‑sheet insolvency: liabilities (including contingent and prospective liabilities) exceed assets on...

Airline insolvency in England and Wales: industry features, regulatory framework, financing structures, early-stage measures and pre‑insolvency enforcement

Published by a LexisNexis Restructuring & Insolvency expert

Practice notes

Introduction to the airline industry

The purpose of this Practice Note is to present an overview of certain key features of airline insolvencies in England and Wales, and to highlight legal and practical considerations that can shape strategies and Outcomes when an airline enters Insolvency proceedings. This Practice Note forms part of a wider suite on airline insolvency. For further information, see the following Practice Notes:

Guide to airline insolvency—insolvency proceedings, Receivership, restructuring plans and Schemes of arrangement
Guide to airline insolvency—international considerations and implications for office-holders

There are particular aspects of the airline industry that set airline insolvencies apart from those of companies in many other sectors. In particular:

the financing structures for the manufacture and acquisition of aircraft, together with the related ownership and leasing frameworks, are often highly complex and can differ significantly from one case to another
the industry is subject to extensive regulation, and the rules applied to airlines can restrict how they operate and influence how easily enforcement action can be taken
the valuable assets required to run an airline’s business (and the focus of a key element of a financier’s...

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Mark Craggs

Norton Rose Fulbright

Mark Craggs is a restructuring and insolvency lawyer based in the London office of Norton Rose Fulbright. He advises UK and international insolvency office-holders, banks and other creditors, corporates, directors, pension scheme trustees, government bodies, regulators and other stakeholders on a wide range of contentious and non-contentious matters. Mark is a Fellow of INSOL International and a member of a number of committees of INSOL International (including the Technical Research Committee and the Younger Members Committee). He is also a member of the International Insolvency Institute's NextGen Leadership Program, the Insolvency Lawyers' Association and the Association of Business Recovery Professionals (R3). In 2016, he was selected as one of the "40 Under 40" cross-border restructuring and insolvency lawyers worldwide by Global Restructuring Review. He is described in Legal 500 (2017) as an "excellent all-round insolvency lawyer"....

Web page updated on 21/05/2026

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