This is the original version (as it was originally made).
(This note is not part of the Order)
These Regulations implement Directive 2006/123/EC of the European Parliament and of the Council on services in the internal market (OJ No. L 376, 21.12.2006, p.36) (“the Directive”) as it relates to insolvency practitioners.
The Directive establishes general provisions facilitating the exercise of freedom of establishment for service providers and the free movement of services, while maintaining a high quality of services.
In particular, the Directive provides that—
(a)a document in its original form may not be required except where there is an overriding reason relating to the public interest (Article 5(3));
(b)member States shall ensure that all procedures and formalities relating to access to a service activity and to the exercise thereof may be easily completed, at a distance and by electronic means (Article 8(1));
(c)in the absence of an overriding reason relating to the public interest, limitation of an authorisation to provide a service to a particular part of a territory is prohibited (Article 10(4));
(d)authorisation granted to a provider of services shall not be for a limited period except where authorisation is automatically renewed or is subject only to continued fulfilment of requirements (Article 11(1)); and
(e)where a provider of services has professional liability insurance or a guarantee in a member State where the provider is already established which is equivalent or essentially comparable to that required in another member State, there shall be no requirement for further professional liability insurance or guarantee (Article 23(2)).
Regulation 2(2) amends Article 348A(2) of the Insolvency (Northern Ireland) Order 1989 (S.I. 1989/2405 (N.I. 19) with the effect that an individual who is authorised by the Secretary of State to act solely as a nominee or supervisor in voluntary arrangements in Great Britain is also authorised to act in that capacity in Northern Ireland.
Regulation 2(3) amends Article 349(2) of the Insolvency (Northern Ireland) Order 1989 with the effect that an individual who is authorised by the Secretary of State to act as an insolvency practitioner in Great Britain is also authorised to act as an insolvency practitioner in Northern Ireland.
Regulation 2(4) amends Article 350(2) of the Insolvency (Northern Ireland) Order 1989 to remove territorial restrictions.
Regulation 2(5) amends Article 352(3) of the Insolvency (Northern Ireland) Order 1989 with the effect that the period of an authorisation by the Department to act as an insolvency practitioner is reduced from a maximum of three years to a period of one year, but the insolvency practitioner can be further authorised for further periods of one year without the requirement for an application where the insolvency practitioner continues to be a fit and proper person to act as an insolvency practitioner and to meet prescribed requirements with respect to education and practical training and experience.
Regulation 3 makes amendments to the Insolvency Practitioners Regulations (Northern Ireland) 2006 (S.R. 2006 No. 33) as set out in the Schedule.
Paragraph 3 of the Schedule provides that the number of hours of insolvency work experience required by an applicant to the Department for authorisation to act as an insolvency practitioner who has never previously been authorised is reduced from 7000 to 2000 hours.
Paragraph 4 of the Schedule prescribes a reduced number of hours of practical experience required by an applicant who has previously been authorised to act as an insolvency practitioner to reflect the reduction in the authorisation period from three years to a fixed period of one year. A further reduction in hours for the first period of authorisation is prescribed to compensate for the fact that in the first year of authorisation the period covered by the return is reduced on account of the amendment in paragraph 6 of the Schedule which amends regulation 11 of the Insolvency Practitioners Regulations with the effect that an insolvency practitioner submits the return by reference to the period of authorisation. A new regulation is inserted prescribing the education and training required for the period of a further authorisation.
Paragraph 5 of the Schedule revokes the maximum period of authorisation in consequence of the amendment to Article 352(3) of the Insolvency Northern Ireland) Order 1989.
Paragraph 6 of the Schedule amends the requirements for an insolvency practitioner to submit an annual return to include details of continuing professional development undertaken during the period of authorisation.
Paragraph 7 of the Schedule applies the bonding requirements prescribed for insolvency practitioners authorised by recognised professional bodies and competent authorities in Northern Ireland to insolvency practitioners authorised by a competent authority in Great Britain who hold office in insolvency procedures in Northern Ireland.
Paragraph 8 of the Schedule provides that professional liability insurance or a guarantee in an EEA State in which the insolvency practitioner is already established which is equivalent or essentially comparable to a bond approved by the Department is prescribed security for the purposes of Article 349(3)(b) of the Insolvency (Northern Ireland) Order 1989. It also provides for the procedure by which such equivalence or essential comparability is determined. Sub-paragraph (7) provides that the bond or professional liability insurance or guarantee and evidence of its equivalence or essential comparability to a bond or a copy thereof shall be sent to the authorising body and may be sent electronically.
Paragraph 9 of the Schedule amends the minimum requirements for records that an insolvency practitioner must keep in consequence of Regulation 2(3).
A full impact assessment has not been prepared for these Regulations as no impact on the private, public or voluntary sectors is foreseen. As these Regulations partially transpose a Directive, a Transposition Note has been prepared. Copies of the Transposition Note are available from the Insolvency Service, DETI, Fermanagh House, Ormeau Avenue, Belfast, BT2 8NJ. A copy of the Transposition Note is also annexed to the Explanatory Memorandum which is available alongside this instrument on the OPSI website.
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