The Insolvency (Amendment) Rules 2011

EXPLANATORY NOTE

(This note is not part of the Order)

These Rules make amendments to the Insolvency Rules 1986. They apply in England and Wales only.

Rule 3 amends Rule 5A.10, which details property to be excluded for the purposes of determining eligibility for a Debt Relief Order (DRO). The amendment provides that rights under an approved pension scheme as defined by Section 11 of the Welfare Reform and Pensions Act 1999 are not to be considered for the purposes of determining the value of the debtor’s property for the purposes of an application for a DRO.

Rules 4 to 14 provide for the allocation of proceedings to the London insolvency district and the appropriate court in which a bankruptcy petition is to be presented and to which an application is to be made in relation to a DRO under section 251M or 251N of the Insolvency Act 1986.

Rule 9 provides for the proceedings which are allocated to the London insolvency district.

Rule 4 provides that where an application is to be made to the court under section 251M or 251N of the Insolvency Act 1986 and the proceedings are allocated to the London insolvency district, the appropriate court to which the application is to be made is the Central London County Court except where the debtor has not resided in England and Wales in the 6 months preceding the application, in which case the appropriate court is the High Court.

Where proceedings are not allocated to the London insolvency district the appropriate court is the debtor’s own county court.

Rule 6 provides for the appropriate court to which a creditor must present a bankruptcy petition.

Where proceedings are allocated to the London insolvency district because the debtor’s place of business or residence within the 6 months immediately preceding the presentation of the petition was within the area of the London insolvency district, or because a Minister of the Crown or a Government Department is presenting the petition, the appropriate court is either the High Court or the Central London County Court according to the value of the petition debt.

In other cases where proceedings are allocated to the London insolvency district, the appropriate court is the High Court.

Where proceedings are not allocated to the London insolvency district the appropriate court is the debtor’s own county court.

Rule 7 provides for the appropriate court to which a debtor must present a bankruptcy petition.

Where proceedings are allocated to the London insolvency district because the debtor’s place of business or residence within the 6 months immediately preceding the presentation of the petition was within the area of the London insolvency district, the appropriate court is either the High Court or the Central London County Court according to the value of the unsecured liabilities set out in the statement of affairs attached to the petition.

Where proceedings are not allocated to the London insolvency district the appropriate court is the debtor’s own county court.

Rules 6 and 7 also provide that where a court is seized of a matter in relation to an individual voluntary arrangement in relation to the debtor, the appropriate court to which a creditor or the debtor must present the bankruptcy petition is the court seized of the individual voluntary arrangement matter unless, at the time of the presentation of the petition, the debtor has been residing outside England and Wales for more than six months, the petitioner does not know where the debtor resides or carries on business, the debtor is a member of an insolvent partnership which is being wound up by the High Court or a petition based on a criminal bankruptcy order has been presented in relation to the debtor. In those circumstances the appropriate court is the High Court.

Rules 5, 8 and 10 to 14 make consequential amendments.

Rules 15 and 16 make transitional provisions.

A full impact assessment of the effect that Rule 3 of this instrument will have on the costs of business and the voluntary sector is available from the Insolvency Service website ( www.insolvency.gov.uk) and is published with the Explanatory Memorandum alongside the instrument on www.legislation.gov.uk.

A full impact assessment has not been prepared for Rules 4 to 14 as they have no impact on the private, public or voluntary sectors.