Part XXIV Insolvency

Bankruptcy

I1372 Petitions.

1

The F2FCA may present a petition to the court—

a

under section 264 of the 1986 Act (or Article 238 of the 1989 Order) for a bankruptcy order to be made against an individual; or

b

under section 5 of the 1985 Act for the sequestration of the estate of an individual.

F11A

The PRA may present a petition to the court—

a

under section 264 of the 1986 Act (or Article 238 of the 1989 Order) for a bankruptcy order to be made against an individual who is a PRA-regulated person;

b

under section 5 of the 1985 Act for the sequestration of the estate of an individual who is a PRA-regulated person.

2

But F3a petition may be presented by virtue of subsection (1) or (1A) only on the ground that—

a

the individual appears to be unable to pay a regulated activity debt; or

b

the individual appears to have no reasonable prospect of being able to pay a regulated activity debt.

3

An individual appears to be unable to pay a regulated activity debt if he is in default on an obligation to pay a sum due and payable under an agreement.

4

An individual appears to have no reasonable prospect of being able to pay a regulated activity debt if—

a

F4a regulator has served on him a demand requiring him to establish to the satisfaction of F5that regulator that there is a reasonable prospect that he will be able to pay a sum payable under an agreement when it falls due;

b

at least three weeks have elapsed since the demand was served; and

c

the demand has been neither complied with nor set aside in accordance with rules.

5

A demand made under subsection (4)(a) is to be treated for the purposes of the 1986 Act (or the 1989 Order) as if it were a statutory demand under section 268 of that Act (or Article 242 of that Order).

6

For the purposes of a petition presented in accordance with subsection (1)(b) F6or (1A)(b)—

a

F7the regulator by which the petition is presented is to be treated as a qualified creditor; and

b

a ground mentioned in subsection (2) constitutes apparent insolvency.

7

“Individual” means an individual—

a

who is, or has been, an authorised person; or

b

who is carrying on, or has carried on, a regulated activity in contravention of the general prohibition.

8

“Agreement” means an agreement the making or performance of which constitutes or is part of a regulated activity carried on by the individual concerned.

9

“Rules” means—

a

in England and Wales, rules made under section 412 of the 1986 Act;

b

in Scotland, rules made by order by the Treasury, after consultation with the Scottish Ministers, for the purposes of this section; and

c

in Northern Ireland, rules made under Article 359 of the 1989 Order.