You may recall our news item in August providing a summary of the likely noteworthy changes anticipated in the forthcoming introduction of the new Insolvency Rules 2016. The overarching intention throughout development has been to remove perceived barriers to the efficient administration of insolvency proceedings, reduce unnecessary regulatory burdens and hence drive down the cost of administering insolvency processes.
The new rules (The Insolvency (England and Wales) Rules 2016) have now been laid before Parliament and will take effect from 6 April 2017. They will replace the current Insolvency Rules originally introduced in 1986 (and their 28 subsequent amendments) and will apply to both new cases and the overwhelming majority of existing cases. Although only applying to England and Wales, corresponding rules changes for Scotland and Northern Ireland are expected to follow.
Summarily, the major advantages for creditors in insolvency processes are intended to be;
- The simplification and modernisation of the language used to reduce technical jargon and assist creditor understanding
- Embracing developing communications technologies for ease of communication with creditors and consequential encouragement of increased creditor involvement in the decision making the process by making participation less onerous
- The consolidation and streamlining of the existing rules (and respective amendments) incorporating recent changes in the law to reduce ‘red tape’
These changes are far-reaching and will require all Insolvency Practitioners to comprehensively review and modernise their internal procedures in order to be able to implement the new requirements. Creditors may rightly expect improved access to appropriate information, more readily available (and less onerous) routes to active participation and greater clarity and understanding in respect of the relevant insolvency process.
This summary is not comprehensive and is intended only to maintain awareness of the timeline for significant forthcoming changes to a variety of insolvency processes. More details are readily available on this website under our August news item. Should you require further information on any of the matters raised above, or if you require advice on any aspect of insolvency, please contact us.