The Insolvency Act 1986 Part A1 Moratorium (Eligibility of Private Registered Providers) Regulations 2020

EXPLANATORY NOTE

(This note is not part of the Regulations)

These Regulations amend the Insolvency Act 1986 (c. 45) in order to ensure that Part A1 (Moratorium) of that Act does not apply in relation to companies which are private registered providers of social housing. They also make a consequential amendment to the Charitable Incorporated Organisations (Insolvency and Dissolution) Regulations 2012 (S.I. 2012/3013).

The Corporate Insolvency and Governance Act 2020 (c. 12) inserted a new Part A1 and Schedule ZA1 into the Insolvency Act 1986. Part A1 provides for a freestanding moratorium for eligible companies to facilitate their rescue from financial difficulty. Schedule ZA1 specifies which companies are eligible for the moratorium under Part A1.

Private registered providers of social housing may be subject to a separate moratorium under Chapter 4 of Part 2 of the Housing and Regeneration Act 2008 (c. 17).

Regulation 2(2) amends the definition of “eligible” in paragraph 1 of Schedule ZA1 of the Insolvency Act 1986. This amendment inserts a reference to paragraph 2A, as inserted into that schedule by Regulation 2(3), into the list of paragraphs of Schedule ZA1 by which certain categories of company are excluded from eligibility for the moratorium under Part A1.

Regulation 2(3) inserts a new paragraph 2A into Schedule ZA1 which excludes companies that are private registered providers of social housing from eligibility for a moratorium under Part A1.

Regulation 2(4) inserts references to paragraph 2A into paragraph 18 of Schedule ZA1 of the Insolvency Act 1986. This ensures that certain overseas companies which are the equivalent of private registered providers of social housing remain eligible for a moratorium under Part A1.

Regulation 3 amends paragraph 1(2A) of Schedule 1 to the Charitable Incorporated Organisations (Insolvency and Dissolution) Regulations 2012 (S.I. 2012/3013) in order to remove a redundant provision excluding private registered providers of social housing from the application of Part A1 of the Insolvency Act 1986 to charitable incorporated organisations (“CIOs”). By virtue of paragraph 1(1) of Schedule 1 to S.I. 2012/3013, Schedule ZA1 to the Insolvency Act 1986 applies to CIOs as it does to companies, with certain modifications. This is subject to sub-paragraph (2A), inserted into those Regulations by paragraph 49 of Schedule 3 to the Corporate Insolvency and Governance Act 2020, which provides that Part A1 of the 1986 Act does not apply in relation to a CIO that is a private registered provider of social housing or a registered social landlord under Part 1 of the Housing Act 1996. In consequence of the amendments made to Schedule ZA1 by regulation 3 this provision is redundant in relation to private registered providers of social housing, as companies that are private registered providers are not eligible for the moratorium under Part A1. Regulation 3 revokes paragraph 1(2A)(a) of Schedule 1 to S.I. 2012/3013 in consequence.

A full impact assessment has not been produced for this instrument as no, or no significant, impact on the private, voluntary or public sector is foreseen.