The Investment Bank Special Administration (Scotland) Rules 2011

CHAPTER 6 Correspondence and remote attendance

Correspondence instead of meetings

75.—(1) This rule applies where an administrator proposes to conduct the business of a creditors’ meeting, a clients’ meeting, a creditors and clients’ meeting or a meeting of contributories (as the case may be) by correspondence.

(2) Where the meeting in question is a creditors’ meeting, a clients’ meeting or a creditors and clients’ meeting, notice of the business to be conducted shall be given to all who are entitled to be notified of the meeting by virtue of paragraph 51.

(3) The administrator may seek to obtain the agreement of the participants of the meeting to a resolution by sending to each participant a copy of the proposed resolution.

(4) The administrator shall send to the participants of the meeting a copy of any proposed resolution on which a decision is sought, which shall be set out in such a way that agreement with or dissent from each separate resolution may be indicated by the recipient on the copy so sent.

(5) The administrator shall set a closing date for receipt of votes and comments. The closing date shall be set at the discretion of the administrator, but shall not be less than 14 business days from the date of issue of the notice under paragraph (2) of this rule.

(6) In order to be considered, votes and comments must be received by the administrator by the closing date and must be accompanied by the creditor’s submission of claim or the client’s details of their claim (referred to in rules 64 and 68) except where these have already been provided to the administrator.

(7) Rule 71 applies where both creditors and clients are voting on a proposed resolution as it applies to meetings of creditors and clients.

(8) For the conduct of business to proceed, the administrator must receive at least one response which satisfies the requirements of paragraph (6) of this rule.

(9) If no responses are received by the closing date then the administrator shall summon a meeting of creditors, of clients or of creditors and clients, or a meeting of contributories, as the case may be.

(10) Any single creditor, or a group of creditors, of the company whose debt amounts to at least 10% of the total debts of the investment bank may, within 5 business days from the date of the administrator sending out the proposed resolution, require the administrator to summon a creditors’ meeting to consider the proposed resolution.

(11) Clients asserting claims over at least 10% of the total value of client assets held by the investment bank may, within 5 business days from the date of issue of the notice, require the administrator to call a meeting of clients to consider the proposed resolution.

(12) Contributories representing claims over at least 10% of the total voting rights of all contributories having the right to vote at a meeting of contributories may, within 5 business days from the date of issue of the notice, require the administrator to call a meeting of contributories to consider the proposed resolution.

(13) If the administrator’s proposed resolution is rejected by the creditors or by the clients pursuant to this rule, the administrator may summon a meeting of creditors, clients or creditors and clients, as the case may be.

(14) A reference in this Part to anything done at a meeting of creditors, clients, creditors and clients or contributories includes a reference to anything done in the course of correspondence in accordance with this rule.

Remote attendance at meetings conducted in accordance with section 246A(9) of the 1986 Act

76.—(1) This rule applies to a request to the administrator for a meeting under section 246A(9) of the 1986 Act(1) (remote attendance at meetings) to specify a place for the meeting.

(2) The request must be accompanied by—

(a) in the case of a request by creditors, a list of the creditors making or concurring with the request and the amounts of their respective debts in the special administration;

(b) in the case of a request by clients, a list of the clients making or concurring with the request and the amounts of their respective claims in respect of client assets in the special administration;

(c) in the case of a request by contributories, a list of the contributories making or concurring with the request and their respective values (being the amounts for which they may vote at the meeting);

(d) in the case of a request by members, a list of the members making or concurring with the request and their voting rights; and

(e) from each person concurring, written confirmation of that person’s concurrence.

(3) The request must be made within 7 business days of the date on which the administrator sent the notice of the meeting in question.

(4) Where the administrator considers that the request has been properly made in accordance with the Regulations and this rule, the administrator must—

(a) give notice to all those previously given notice of the meeting—

(i) that it is to be held at a specified place, and

(ii) as to whether the date and time are to remain the same or not;

(b) set a venue (including specification of a place) for the meeting, the date of which must be not later than 28 days after the original date for the meeting; and

(c) give at least 14 days’ notice of that venue to all those previously given notice of the meeting,

and the notices required by sub-paragraphs (a) and (c) may be given at the same or different times.

(5) Where the administrator has specified a place for the meeting in response to a request to which this rule applies, the chair of the meeting must attend the meeting by being present in person at that place.

(6) Rule 56 (expenses of requisitioned meetings) does not apply to the summoning and holding of a meeting at a place specified in accordance with section 246A(9) of the 1986 Act.

Action where person excluded

77.—(1) In this rule and rules 78 and 79 an “excluded person” means a person who —

(a) has taken all steps necessary to attend a meeting under the arrangements put in place to do so by the administrator under section 246A(6) of the 1986 Act; and

(b) is not permitted by those arrangements to attend the whole or part of that meeting.

(2) Where the chair becomes aware during the course of the meeting that there is an excluded person, the chair may—

(a) continue the meeting;

(b) declare the meeting void and convene the meeting again;

(c) declare the meeting valid up to the point where the person was excluded and adjourn the meeting.

(3) Where the chair continues the meeting, the meeting is valid unless—

(a) the chair decides in consequence of a complaint under rule 79 to declare the meeting void and hold the meeting again; or

(b) the court directs otherwise.

(4) Without prejudice to paragraph (2), where the chair becomes aware during the course of the meeting that there is an excluded person, the chair may, in the chair’s discretion and without an adjournment, declare the meeting suspended for any period up to 1 hour.

Indication to excluded person

78.—(1) A person who claims to be an excluded person may request an indication of what occurred during the period of that person’s claimed exclusion (an “indication”).

(2) A request under paragraph (1) must be made as soon as reasonably practicable and, in any event, no later than 16.00 hours on the business day following the day on which the exclusion is claimed to have occurred.

(3) A request under paragraph (1) must be made to—

(a) the chair, where it is made during the course of the business of the meeting; or

(b) the administrator where it is made after the conclusion of the business of the meeting.

(4) Where satisfied that the person making the request is an excluded person, the person to whom the request is made under paragraph (3) must give the indication as soon as reasonably practicable and, in any event, no later than 16.00 hours on the business day following the day on which the request was made under paragraph (1).

Complaint

79.—(1) Any person who—

(a) is, or claims to be, an excluded person; or

(b) attends the meeting (in person or by proxy) and considers that they have been adversely affected by a person’s actual, apparent or claimed exclusion,

(“the complainant”) may make a complaint.

(2) The person to whom the complaint must be made (“the relevant person”) is—

(a) the chair, where it is made during the course of the meeting; or

(b) the administrator, where it is made after the meeting.

(3) The relevant person must—

(a) consider whether there is an excluded person; and

(b) where satisfied that there is an excluded person, consider the complaint,

and, where satisfied that there has been prejudice, take such action as the relevant person considers fit to remedy the prejudice.

(4) Paragraph (5) applies where—

(a) the relevant person is satisfied that the complainant is an excluded person;

(b) during the period of the person’s exclusion, a resolution was put to the meeting and was voted on; and

(c) the excluded person asserts how the excluded person intended to vote on the resolution.

(5) Subject to paragraph (6), where satisfied that the effect of the intended vote in paragraph (4), if cast, would have changed the result of the resolution, the relevant person must—

(a) count the intended vote as being cast in accordance with the complainant’s stated intention;

(b) amend the record of the result of the resolution; and

(c) where those entitled to attend the meeting have been notified of the result of the resolution, notify them of the change.

(6) Where satisfied that more than one complainant in paragraph (4) is an excluded person, the relevant person must have regard to the combined effect of the intended votes.

(7) The relevant person must notify the complainant in writing of any decision.

(8) A complaint must be made as soon as reasonably practicable and, in any event, no later than 16.00 hours on the business day following—

(a) the day on which the person was, appeared or claimed to be excluded; or

(b) where an indication is sought under rule 78, the day on which the complainant received the indication.

(9) A complainant who is not satisfied by the action of the relevant person may apply to the court for directions and any application must be made within 2 business days of the date of receiving the decision of the relevant person.

(1)

Section 246A was inserted by S.I. 2010/18.