(This note does not form part of the Regulations)
These Regulations replace the Insolvency Regulations 1986 (as amended) and provide for a less onerous regime in respect of administrative matters that were covered by the 1986 Regulations. In particular the Regulations provide for:
(a) the crediting of interest on balances in excess of £2,000 standing to the credit of companies in the Insolvency Services Account without the need for the liquidator to give notice (regulation 9(6));
(b) the abolition of the automatic requirement for liquidators in compulsory liquidations and trustees to provide annual accounts of their receipts and payments (but the Secretary of State has power to require accounts to be sent to him (regulations 14(1) and 28(1));
(c) the submission of accounts where a liquidator or a trustee vacates office prior to the holding of the final creditors' meeting and the submission of accounts after the holding of the final creditors' meeting (regulations 14 and 28);
(d) an increase in the hourly rate for remuneration of the official receiver whilst acting as interim receiver, provisional liquidator or as liquidator or trustee where that remuneration is not calculated as a percentage of the assets realised or distributed (regulation 35 and Schedule 2, Tables 2 and 3). The increases in hourly rates are broadly in line with inflation;
(e) the abolition, in certain cases, of remuneration for the provision of services by certain grades of staff (regulation 35 and Schedule 2, Tables 2 and 3); and
(f) an upper limit on remuneration calculated by reference to realisations for functions carried out by the official receiver in cases where the bankruptcy debts and expenses are paid in full (or, in the case of the bankruptcy debts, are secured to the satisfaction of the court) (regulation 34).
The structure of the Regulations is as follows:
Part 1 deals with the interpretation and application of the Regulations and the revocation of the Insolvency Regulations 1986, the Insolvency (Amendment) Regulations 1987, the Insolvency (Amendment) Regulations 1988 and the Insolvency (Amendment) Regulations 1991;
Parts 2 and 3 apply to companies that are being wound up by the court or voluntarily and to bankruptcy. The provisions in those Parts deal with:
(a) the manner in which money received by a liquidator, a trustee or the official receiver whilst acting as receiver or manager in the course of carrying out their respective functions are to be handled;
(b) payments by a liquidator, a trustee or the official receiver whilst acting as receiver or manager including provision with respect to unclaimed funds and dividends;
(c) the investment of, and payment of interest on, funds received by a liquidator in the course of carrying out his functions;
(d) the preparation and maintenance of records and their production for inspection; and
(e) the provision and audit of accounts and the supply by a liquidator, a trustee or the official receiver whilst acting as receiver or manager of accounts to creditors and others.
Part 4 deals with the claiming of money in the Insolvency Services Account;
Part 5 relates to the remuneration of the official receiver; and
Part 6 contains transitional and saving provisions.
A Compliance Cost Assessment is available, copies of which have been placed in the libraries of both Houses of Parliament. Copies are also available from The Insolvency Service of the Department of Trade and Industry, PO Box 203, Room 5.1, 21 Bloomsbury Street, London WC1B 3QW.