The Insurers (Reorganisation and Winding Up) Regulations 2004

Explanatory Note

(This note is not part of the Regulations)

These Regulations revoke and replace in their entirety the Insurers (Reorganisation and Winding Up) Regulations 2003 (SI 2003/1102) which implemented the directive of the Parliament and the Council on the reorganisation and winding up of insurance undertakings (2001/17/EC) for all UK insurers except Lloyd's. They take account of the changes to insolvency law brought about by the commencement of the Enterprise Act 2002 and in particular the new administration procedures in the new Schedule B1 to the Insolvency Act 1986. The Financial Services and Markets Act 2000 (Administration Orders Relating to Insurers) Order 2002 (SI 2002/1242) is amended to disapply paragraphs 14 and 22 of Schedule B1 because the reorganisation and winding up directive does not permit the appointment of an administrator other than by a court. These Regulations continue to provide that no winding up proceedings or voluntary arrangements in respect of EEA insurers can be undertaken in the UK except in the circumstances permitted by the Regulations. EEA reorganisation and winding up proceedings are to be recognised in the UK. Provisions are made for the exercise by EEA liquidators of their functions in the UK. Provision is made for the notification of reorganisation and winding up proceedings to competent authorities in other EEA Member States. Modifications are made to UK insolvency law in respect of notifications of various other matters including important stages in the relevant procedures and forms in which creditors in other EEA States may enter claims, to the FSA, EEA authorities and creditors. There are detailed changes from the provisions in the Regulations replaced with regard to administration and in particular to accommodate the ability for companies, Directors and holders of floating charges to appoint an administrator without a court order. The Regulations provide for the special order of priority for insurance debts created by the directive to apply to UK insurers and for the carrying through of the consequences of this in insolvency law. They make provision for application to insurers whose head office is outside the UK and the EEA. Provision is made for detailed amendment of existing secondary legislation including the insolvency rules in all UK jurisdictions dealing with the reorganisation or winding up of insurers.