The Anti-terrorism (Financial and Other Measures) (Overseas Territories) Order 2002

PART 3 Insolvency

General

12.  In this Part of this Schedule—

“ancillary order” means an order made in connection with a forfeiture, other than the forfeiture order,

“forfeiture order” means an order made in the Territory under article 15 or an external forfeiture order which is enforceable in the Territory by virtue of an order made by the Governor under paragraph 11,

“forfeited property” means the money or other property to which a forfeiture order applies, and

“restraint order” means an order made under paragraph 5 or an external restraint order which is enforceable in the Territory by virtue of an order made by the Governor under paragraph 11.

Protection of creditors against forfeiture

13.—(1) During the period of six months beginning with the making of a forfeiture order, the following shall not be finally disposed of under this Schedule—

(a) the money to which the order applies, and

(b) the money which represents any property to which the order applies.

(2) For the purposes of this paragraph money is finally disposed of under this Schedule when—

(a) in the case of a forfeiture order made in the Territory, it is paid to the person or authority authorised by law to receive the proceeds of fines, or

(b) in the case of an external forfeiture order, it is paid to the Governor under paragraph 11(9)(b).

14.—(1) This paragraph applies where—

(a) before or after a forfeiture order is made, the commencement of an insolvency occurs in qualifying insolvency proceedings,

(b) an insolvency practitioner would, but for the forfeiture order, exercise a function in those proceedings in relation to property to which the forfeiture order applies, and

(c) he gives written notice to the relevant officer of the matters referred to in sub- paragraphs (a) and (b) before the end of the period of six months beginning with the making of the forfeiture order.

(2) Sub-paragraph (3) shall apply to—

(a) the property in relation to which the insolvency practitioner would, but for the forfeiture order, exercise a function as described in sub-paragraph (l)(b), and

(b) the proceeds of sale of that property.

(3) The property—

(a) shall cease to be subject to the forfeiture order and any ancillary order, and

(b) shall be dealt with in the insolvency proceedings as if the forfeiture order had never been made.

(4) But—

(a) the property to which sub-paragraph (3) applies is the balance remaining after the relevant officer has exercised his powers under paragraph 17(1), and

(b) sub-paragraph (3) shall not take effect in respect of property in relation to which the relevant officer, or any person acting in pursuance of an ancillary order, has incurred obligations until those obligations have been discharged.

(5) In this paragraph “the commencement of an insolvency” means—

(a) the making of a bankruptcy order,

(b) in the case of the insolvent estate of a deceased person, the making of an insolvency administration order, or

(c) in the case of a company, the passing of a resolution for its winding up or, where no such resolution has been passed, the making of an order by a court for its winding up.

15.—(1) Where by virtue of paragraph 14(3) property falls to be dealt with in insolvency proceedings, the Governor shall be taken to be a creditor in those proceedings for a debt to the amount or value of the property.

(2) The Governor’s debt—

(a) shall rank after the debts of all other creditors, and

(b) shall not be paid until they have been paid in full with interest under the relevant provision.

(3) In sub-paragraph (2)(b) the “relevant provision” means—

(a) in relation to the winding up of a company, the provision of the law for the time being in force in the Territory relating to such winding up on insolvency that provides for the payment, from any surplus remaining after the payment of debts proved on the winding up, of interest on those debts in respect of the periods during which they have been outstanding since the company went into liquidation, and

(b) in relation to a bankruptcy, the provision of the law for the time being in force in the Territory relating to bankruptcy that provides for the payment, from any surplus remaining after the payment of debts that are preferential or rank equally under such law, of interest on those debts in respect of the periods during which they have been outstanding since the commencement of the bankruptcy.

(4) Sub-paragraphs (2) and (3) apply notwithstanding any other law for the time being in force in the Territory.

16.—(1) This paragraph applies to any property which ceased to be subject to a forfeiture order by virtue of paragraph 14(3) in consequence of the making of a bankruptcy order.

(2) The property shall again become subject to the forfeiture order and, if applicable, any ancillary order if the bankruptcy order is annulled.

(3) Where the property is money or has been converted into money—

(a) the court which ordered the annulment of the bankruptcy shall make an order specifying property comprised in the estate of the bankrupt or debtor to the amount or value of the property, and

(b) the specified property shall become subject to the forfeiture order, and any applicable ancillary order, in place of the property.

17.—(1) Where money or other property falls to be dealt with in accordance with paragraph 14(3), the relevant officer may—

(a) deduct allowable forfeiture expenses from that money;

(b) retain so much of that property as he considers necessary for the purpose of realising it and deducting allowable forfeiture expenses from the proceeds of realisation.

(2) Where property is delivered up in pursuance of paragraph 14(3) and the relevant officer has not made provision under sub-paragraph (1) for all the allowable forfeiture expenses, then—

(a) a person who has incurred allowable forfeiture expenses for which provision has not been made shall have a claim to their value in the insolvency proceedings, and

(b) the expenses in question shall be treated for the purposes of the insolvency proceedings as if they were expenses of those proceedings.

Protection of insolvency practitioners

18.—(1) This paragraph applies where an insolvency practitioner seizes or disposes of property which is subject to a forfeiture order or a restraint order and—

(a) he reasonably believes that he is entitled to do so in the exercise of his functions, and

(b) he would be so entitled if the property were not subject to a forfeiture order or a restraint order.

(2) The insolvency practitioner shall not be liable to any person in respect of any loss or damage resulting from the seizure or disposal except in so far as the loss or damage is caused by his negligence.

(3) The insolvency practitioner shall have a lien on the property seized or the proceeds of its sale—

(a) for such of his expenses as were incurred in connection with the insolvency proceedings in relation to which the seizure or disposal purported to take place, and

(b) for so much of his remuneration as may be reasonably assigned for his acting in connection with those proceedings.

(4) Sub-paragraphs (1) to (3) are without prejudice to the generality of any provision contained in any law relating to insolvency for the time being in force in the Territory.

(5) In this paragraph “insolvency practitioner” means a person acting as such and, for the purposes of this paragraph, the question whether any person is acting as such shall be determined in accordance with sub-paragraphs (6), (7) and (8) except that the expression shall also include an Official Receiver (however styled) acting as receiver or manager of property.

(6) For the purposes of this paragraph a person acts as an insolvency practitioner in relation to a company by acting—

(a) as its liquidator, provisional liquidator, administrator or administrative receiver, or

(b) as supervisor of a voluntary arrangement approved by it under the law for the time being in force in the Territory relating to the insolvency of companies.

(7) For the purposes of this paragraph a person acts as an insolvency practitioner in relation to an individual by acting—

(a) as his trustee in bankruptcy or interim receiver of his property, or

(b) as trustee under a deed which is a deed of arrangement made for the benefit of his creditors, or

(c) as supervisor of a voluntary arrangement proposed by him and approved under the law for the time being in force in the Territory relating to the insolvency of individuals, or

(d) in the case of a deceased individual to whose estate the provisions of the law for the time being in force in the Territory relating to the administration of the insolvent estates of deceased persons apply, as administrator of that estate.

(8) References in sub-paragraph (7) to an individual include, except in so far as the context otherwise requires, references to a partnership.

19.—(1) The Governor may make an order under this paragraph to secure that an external insolvency practitioner has the same rights under this Part of this Schedule in relation to property situated in the Territory as he would have if he were an insolvency practitioner in the Territory.

(2) An order made this paragraph may, in particular, include—

(a) provision which modifies the rights under this Part of this Schedule which are to be conferred under the order;

(b) provision as to the manner in which the rights conferred under the order are to be exercised;

(c) provision as to the conditions subject to which those rights are to be exercised, including the obtaining of leave from a court;

(d) provision empowering a court granting such leave to impose such conditions as it thinks fit.

(3) An order under this paragraph may make different provision for different purposes.

(4) In this paragraph—

(a) “external insolvency practitioner” means a person exercising under the insolvency law of a designated country or territory (that is to say, a country or territory designated as mentioned in paragraph 11) functions corresponding to those exercised by insolvency practitioners under the insolvency law of the Territory,

(b) “the insolvency law of the Territory” means the provisions of the law for the time being in force in the Territory relating to insolvency and includes any provisions of the law for the time being in force in the Territory relating to companies which regulate the disqualification of company directors, and

(c) “the insolvency law of a designated country or territory” means so much of the law for the time being in force in that country or territory as corresponds to provisions falling within sub-paragraph (b).

Interpretation

20.—(1) In this Part of this Schedule (other than in paragraph 18) “insolvency practitioner” means a person acting in any qualifying insolvency proceedings in the Territory as—

(a) a liquidator of a company or partnership,

(b) a trustee in bankruptcy,

(c) an administrator of the insolvent estate of a deceased person, or

(d) a receiver or manager of any property.

(2) In this Part of this Schedule “qualifying insolvency proceedings” means—

(a) any proceedings, under any law for the time being in force in the Territory relating to insolvency, for the winding up of a company or an unregistered company and includes any voluntary winding up of a company under any such law,

(b) any proceedings, under any such law, for the winding up of an insolvent partnership,

(c) any proceedings in bankruptcy, or

(d) any proceedings, under any such law, in relation to the insolvent estate of a deceased person.

(3) In this Part of this Schedule “the relevant officer” means the proper officer within the meaning given in paragraph 4.

(4) In this Part of this Schedule references to the proceeds of sale or realisation of property are references to the proceeds after deduction of the costs of sale or realisation.