C1C2C3C9C10C11 Part VI Miscellaneous Provisions Applying to Companies Which are Insolvent or in Liquidation

Annotations:
Modifications etc. (not altering text)
C3

Pt. 6 (ss. 230–246) modified by Company Directors Disqualification Act 1986 (c. 46, SIF 27), ss. 21(2), 25

Pt. 6 (ss. 230-246) applied (1.12.1994) by S.I. 1994/2421, art. 6(3)(b)

Pt. 6 (ss. 230-246) applied (1.12.1994) by S.I. 1994/2421, art. 10(2)(3)(6), Sch. 4 Pt. II

Pt. 6 (ss. 230-246) applied (with modifications) (1.12.1994) by S.I. 1994/2421, art. 8(4)(5)(8)(9)

Pt. 6 (ss. 230-246) applied (with modifications) (1.12.1997) by 1986 c. 53, Sch. 15A para. 1(1)(2)(a) (as inserted by 1997 c. 32, s. 39(2), Sch. 6); S.I. 1997/2668, art. 2, Sch. Pt. I(i); and as amended (13.3.2018) by The Small Business, Enterprise and Employment Act 2015 (Consequential Amendments, Savings and Transitional Provisions) Regulations 2018 (S.I. 2018/208), regs. 1(3), 2(3); and (26.6.2020) by Corporate Insolvency and Governance Act 2020 (c. 12), s. 49(1), Sch. 12 para. 3 (with ss. 2(2), 5(2), 14(4)))

Pt. 6 (ss. 230-246) amended (1.12.2001) by S.I. 2001/3538, art. 2(1)

C9

Pts. 1-4, 6, 7 applied to limited liability partnerships (with modifications) (E.W.S.) (6.4.2001) by S.I. 2001/1090, reg. 5, Schs. 3, 4 (as amended (4.3.2004) by S.I. 2004/355, art. 10 and (1.10.2005) by S.I. 2005/1989, reg. 3, Sch. 2 (with reg. 4))

C10

First Group of Parts (Pts. 1-7) applied (with modifications) (15.12.2006) by The Banks (Former Authorised Institutions) (Insolvency) Order 2006 (S.I. 2006/3107), art. 3, Sch. (as amended (1.4.2013) by S.I. 2013/472, art. 1(1), Sch. 2 para. 117; and (13.3.2018) by S.I. 2018/208, regs. 1(3), 11)

Adjustment of prior transactions (administration and liquidation)

C4C5C6C7C8C12238 Transactions at an undervalue (England and Wales).

1

This section applies in the case of a company where—

F1a

the company enters administration,

b

the company goes into liquidation;

and “the office-holder” means the administrator or the liquidator, as the case may be.

2

Where the company has at a relevant time (defined in section 240) entered into a transaction with any person at an undervalue, the office-holder may apply to the court for an order under this section.

3

Subject as follows, the court shall, on such an application, make such order as it thinks fit for restoring the position to what it would have been if the company had not entered into that transaction.

4

For the purposes of this section and section 241, a company enters into a transaction with a person at an undervalue if—

a

the company makes a gift to that person or otherwise enters into a transaction with that person on terms that provide for the company to receive no consideration, or

b

the company enters into a transaction with that person for a consideration the value of which, in money or money’s worth, is significantly less than the value, in money or money’s worth, of the consideration provided by the company.

5

The court shall not make an order under this section in respect of a transaction at an undervalue if it is satisfied—

a

that the company which entered into the transaction did so in good faith and for the purpose of carrying on its business, and

b

that at the time it did so there were reasonable grounds for believing that the transaction would benefit the company.