The Insolvency Service has announced changes to the way Insolvency Practitioners submit conduct reports on directors. From 6 April 2016, they will be delivered to the Government via an online portal, but must also be submitted within 3 months of an appointment as an officeholder, rather than the current 6 months.

Insolvency Practice generally is being modernised by central Government legislation and movement toward electronic submission has been going on for a number of years. However, we are noticing a general tightening on rules and regulations regarding review of director conduct, decision making and associated transactions, including the new Statement of Insolvency Practice 16 regarding pre-pack asset sales in administration, more powers for administrators to bring proceedings in respect of director conduct and the ability to assign legal claims available to office holders, which was not previously possible.

We have always suggested Directors take early advice as regarding any concerns they may have with respect to their tenure over a company. If recent procedural changes are indicative of a pattern of change in the landscape of Insolvency Practice, directors will face more risk. If you have any concerns, please contact us.