Insolvency (Amendment) Act (Northern Ireland) 2026

Part 1 — Introductory

Introductory

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• (1) In this Act—

• (a) Parts 2 to 8 contain amendments to the Insolvency (Northern Ireland) Order 1989 corresponding to those made to the Insolvency Act 1986 by sections 117 to 135 of the Small Business, Enterprise and Employment Act 2015;

• (b) Part 9 makes provision corresponding to that made by and under sections 92 to 95 of the Enterprise and Regulatory Reform Act 2013;

• (c) Part 10 contains provision replacing that made by section 1 of the Insolvency (Amendment) Act (Northern Ireland) 2016;

• (d) Part 11 contains miscellaneous amendments relating to the law of insolvency;

• (e) Part 12 contains amendments relating to insolvent partnerships.

• (2) In Parts 2 to 11—

• (a) “the 1989 Order” means the Insolvency (Northern Ireland) Order 1989, and

• (b) any reference to a numbered Article, or Schedule, is a reference to that Article of, or Schedule to, the 1989 Order (unless otherwise stated).

Part 2 — Office-holder actions

Power for administrator to bring claim for fraudulent or wrongful trading

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• (1) In Part 7 of the 1989 Order, after Article 208 insert—

(208ZA) (1) If while a company is in administration it appears that any business of the company has been carried on— (a) with intent to defraud creditors of the company or creditors of any other person, or (b) for any fraudulent purpose, paragraph (2) has effect. (2) The High Court, on the application of the administrator, may declare that any persons who were knowingly parties to the carrying on of the business in the manner mentioned in paragraph (1) are to be liable to make such contributions (if any) to the company’s assets as the Court thinks proper. (208ZB) (1) If while a company is in administration it appears that paragraph (2) applies in relation to a person who is or has been a director of the company, the High Court, on the application of the administrator, may declare that that person is to be liable to make such contribution (if any) to the company’s assets as the Court thinks proper; but this is subject to paragraph (3). (2) This paragraph applies in relation to a person if— (a) the company has entered insolvent administration, (b) at some time before the company entered administration, that person knew or ought to have concluded that there was no reasonable prospect that the company would avoid entering insolvent administration or going into insolvent liquidation, and (c) the person was a director of the company at that time. (3) The High Court must not make a declaration under this Article with respect to any person if it is satisfied that, after the condition specified in paragraph (2)(b) was first satisfied in relation to the person, the person took every step with a view to minimising the potential loss to the company’s creditors as (on the assumption that the person had knowledge of the matter mentioned in paragraph (2)(b)) the person ought to have taken. (4) For the purposes of paragraphs (2) and (3), the facts which a director of a company ought to know or ascertain, the conclusions which the director ought to reach and the steps which the director ought to take are those which would be known or ascertained, or reached or taken, by a reasonably diligent person having both— (a) the general knowledge, skill and experience that may reasonably be expected of a person carrying out the same functions as are carried out by that director in relation to the company, and (b) the general knowledge, skill and experience that that director has. (5) The reference in paragraph (4) to the functions carried out in relation to a company by a director of the company includes any functions which the director does not carry out but which have been entrusted to the director. (6) For the purposes of this Article— (a) a company enters insolvent administration if it enters administration at a time when its assets are insufficient for the payment of its debts and other liabilities and the expenses of the administration; (b) a company goes into insolvent liquidation if it goes into liquidation at a time when its assets are insufficient for the payment of its debts and other liabilities and the expenses of the winding up. (7) In this Article “director” includes a shadow director. (8) This Article is without prejudice to Article 208ZA. (208ZC) Article 179 applies for the purposes of an application under Article 208ZA or 208ZB as it applies for the purposes of an application under Article 177 but as if the reference in Article 179(1) to the liquidator were a reference to the administrator.

• (2) In Article 178 (wrongful trading)—

• (a) in paragraph (2)(b), after “liquidation” insert “or entering insolvent administration”;

• (b) in paragraph (3), for the words from “assuming” to “liquidation” substitute “on the assumption that he had knowledge of the matter mentioned in paragraph (2)(b)”;

• (c) in paragraph (6), for “paragraph” substitute “Article”;

• (d) after paragraph (6) insert—

(6A) For the purposes of this Article a company enters insolvent administration if it enters administration at a time when its assets are insufficient for the payment of its debts and other liabilities and the expenses of the administration.

• (3) Articles 208ZA to 208ZC (as inserted by subsection (1)) and the amendments made to Article 178 by subsection (2) apply in respect of the carrying on of any business of the company on or after the date on which this section comes into operation.

Power for liquidator or administrator to assign causes of action

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After Article 208ZC (inserted by section 2) insert—

(208ZD) (1) This Article applies in the case of a company where— (a) the company enters administration, or (b) the company goes into liquidation; and “the office holder” means the administrator or the liquidator, as the case may be. (2) The office-holder may assign a right of action (including the proceeds of an action) arising under or by virtue of any of the following— (a) Article 13FA (challenges to monitor remuneration in subsequent insolvency proceedings); (b) Article 177 or 208ZA (fraudulent trading); (c) Article 178 or 208ZB (wrongful trading); (d) Article 202 (transactions at an undervalue); (e) Article 203 (preferences); (f) Article 206 (extortionate credit transactions).

Application of proceeds of office-holder claims

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After Article 150ZA insert—

(150ZB) (1) This Article applies where— (a) there is a floating charge (whether created before or after the coming into operation of this Article) which relates to property of a company which— (i) is in administration, or (ii) has gone into liquidation, and (b) the administrator or the liquidator (referred to in this Article as “the office-holder”) has— (i) brought a claim under any provision mentioned in paragraph (3), or (ii) made an assignment in relation to a right of action under any such provision under Article 208ZD. (2) The proceeds of the claim or assignment are not to be treated as part of the company’s net property, that is to say the amount of its property which would be available for satisfaction of claims of holders of debentures secured by, or holders of, any floating charge created by the company. (3) The provisions are— (a) Article 177 or 208ZA (fraudulent trading); (b) Article 178 or 208ZB (wrongful trading); (c) Article 202 (transactions at an undervalue); (d) Article 203 (preferences); (e) Article 206 (extortionate credit transactions). (4) Paragraph (2) does not apply to a company if or in so far as it is disapplied by— (a) a voluntary arrangement in respect of the company, or (b) a compromise or arrangement agreed under Part 26 or 26A of the Companies Act 2006 (arrangements and reconstructions).

Part 3 — Removing requirements to seek sanction

Exercise of powers by liquidator: removal of need for sanction

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• (1) In Article 140 (voluntary winding up: powers of liquidator), for paragraphs (2) and (3) substitute—

(2) The liquidator may exercise any of the powers specified in Parts 1 to 3 of Schedule 2.

• (2) In Article 142 (winding up by the High Court: powers of liquidator), for paragraph (1) substitute—

(1) Where a company is being wound up by the High Court, the liquidator may exercise any of the powers specified in Parts 1 to 3 of Schedule 2.

• (3) Schedule 2 (powers of liquidator in a winding up) is amended as follows.

• (4) After paragraph 2 insert—

(3) Power to compromise, on such terms as may be agreed— (a) all calls and liabilities to calls, all debts and liabilities capable of resulting in debts, and all claims (present or future, certain or contingent, ascertained or sounding only in damages) subsisting or supposed to subsist between the company and a contributory or alleged contributory or other debtor or person apprehending liability to the company, and (b) all questions in any way relating to or affecting the assets or the winding up of the company, and take any security for the discharge of any such call, debt, liability or claim and give a complete discharge in respect of it.

• (5) Omit—

• (a) paragraph 7A;

• (b) the headings for each of Parts 1 to 3.

• (6) In consequence of the amendments made by subsections (4) and (5)(a), omit section 7 of the Insolvency (Amendment) Act (Northern Ireland) 2016.

Exercise of powers by trustee in bankruptcy: removal of need for sanction

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• (1) Article 287 (bankruptcy: powers of trustee) is amended in accordance with subsections (2) to (4).

• (2) For paragraph (1) substitute—

(1) The trustee may exercise any of the powers specified in Parts 1 and 2 of Schedule 3.

• (3) In paragraph (2), omit “With the permission of the creditors’ committee or the High Court,”.

• (4) Omit paragraphs (3) to (5).

• (5) In Schedule 3 (powers of trustee in bankruptcy), omit the headings for each of Parts 1 to 3.

Part 4 — Position of creditors

Chapter 1 — Principal amendments

Abolition of requirements to hold meetings: company insolvency

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• (1) After Article 208ZD (inserted by section 3) insert—

(208ZE) (1) This Article applies where, for the purposes of Parts 1A to 7, a person (“P”) seeks a decision about any matter from a company’s creditors or contributories. (2) The decision may be made by any qualifying decision procedure P thinks fit, except that it may not be made by a creditors’ meeting or (as the case may be) a contributories’ meeting unless paragraph (3) applies. (3) This paragraph applies if at least the minimum number of creditors or (as the case may be) contributories make a request to P in writing that the decision be made by a creditors’ meeting or (as the case may be) a contributories’ meeting. (4) If paragraph (3) applies, P must summon a creditors’ meeting or (as the case may be) a contributories’ meeting. (5) Paragraph (2) is subject to any provision of this Order, the rules or any other legislation, or any order of the High Court— (a) requiring a decision to be made, or prohibiting a decision from being made, by a particular qualifying decision procedure (other than a creditors’ meeting or a contributories’ meeting); (b) permitting or requiring a decision to be made by a creditors’ meeting or a contributories’ meeting. (6) Article 208ZF provides that in certain cases the deemed consent procedure may be used instead of a qualifying decision procedure. (7) For the purposes of paragraph (3) the “minimum number” of creditors or contributories is any of the following— (a) 10% in value of the creditors or contributories; (b) 10% in number of the creditors or contributories; (c) 10 creditors or contributories. (8) The references in paragraph (7) to creditors are to creditors of any class, even where a decision is sought only from creditors of a particular class. (9) In this Article references to a meeting are to a meeting where the creditors or (as the case may be) contributories are invited to be present together at the same place (whether or not it is possible to attend the meeting without being present at that place). (10) Except as provided by paragraph (8), references in this Article to creditors include creditors of a particular class. (11) In Parts 1A to 7 “qualifying decision procedure” means a procedure prescribed or authorised under paragraph 8A of Schedule 5. (208ZF) (1) The deemed consent procedure may be used instead of a qualifying decision procedure where a company’s creditors or contributories are to make a decision about any matter, unless— (a) a decision about the matter is required by virtue of this Order, the rules or any other legislation to be made by a qualifying decision procedure, or (b) the High Court orders that a decision about the matter is to be made by a qualifying decision procedure. (2) If the rules provide for a company’s creditors or contributories to make a decision about the remuneration of any person, they must provide that the decision is to be made by a qualifying decision procedure. (3) The deemed consent procedure is that the relevant creditors other than opted-out creditors or (as the case may be) the relevant contributories are given notice of— (a) the matter about which they are to make a decision, (b) the decision that the person giving the notice proposes should be made (the “proposed decision”), (c) the effect of paragraphs (4) and (5), and (d) the procedure for objecting to the proposed decision. (4) If less than the appropriate number of relevant creditors or (as the case may be) relevant contributories object to the proposed decision in accordance with the procedure set out in the notice, the creditors or (as the case may be) the contributories are to be treated as having made the proposed decision. (5) Otherwise— (a) the creditors or (as the case may be) the contributories are to be treated as not having made a decision about the matter in question, and (b) if a decision about that matter is again sought from the creditors or (as the case may be) the contributories, it must be sought using a qualifying decision procedure. (6) For the purposes of paragraph (4) the “appropriate number” of relevant creditors or relevant contributories is 10% in value of those creditors or contributories. (7) “Relevant creditors” means the creditors who, if the decision were to be made by a qualifying decision procedure, would be entitled to vote in the procedure. (8) “Relevant contributories” means the contributories who, if the decision were to be made by a qualifying decision procedure, would be entitled to vote in the procedure. (9) In this Article references to creditors include creditors of a particular class. (10) The rules may make further provision about the deemed consent procedure. (208ZG) (1) Regulations may amend Article 208ZE so as to change the definition of— (a) the minimum number of creditors; (b) the minimum number of contributories. (2) Regulations may amend Article 208ZF so as to change the definition of— (a) the appropriate number of relevant creditors; (b) the appropriate number of relevant contributories. (3) Regulations under this Article may define the minimum number or the appropriate number by reference to any one or more of— (a) a proportion in value; (b) a proportion in number; (c) an absolute number; and the definition may include alternative, cumulative or relative requirements. (4) Regulations under paragraph (1) may define the minimum number of creditors or contributories by reference to all creditors or contributories, or by reference to creditors or contributories of a particular description. (5) Regulations under this Article may make transitional provision. (6) Regulations may not be made under this Article unless a draft of the regulations has been laid before, and approved by a resolution of, the Assembly.

• (2) In Schedule 5 (provision that may be included in company insolvency rules), after paragraph 8 insert—

(8A) (1) Provision about the making of decisions by creditors and contributories, including provision— (a) prescribing particular procedures by which creditors and contributories may make decisions; (b) authorising the use of other procedures for creditors and contributories to make decisions, if those procedures comply with prescribed requirements. (2) Provision under sub-paragraph (1) may in particular include provision about— (a) how creditors and contributories may request that a creditors’ meeting or a contributories’ meeting be held; (b) the rights of creditors, contributories and others to be given notice of, and participate in, procedures; (c) creditors’ and contributories’ rights to vote in procedures; (d) the period within which any right to participate or vote is to be exercised; (e) the proportion of creditors or contributories that must vote for a proposal for it to be approved; (f) how the value of any debt or contribution should be determined; (g) the time at which decisions taken by a procedure are to be treated as having been made.

• (3) In Article 5 (interpretation of Parts 1A to 7), insert each of the following definitions in its appropriate place—

• “deemed consent procedure” means the deemed consent procedure provided for by Article 208ZF;

• “qualifying decision procedure” has the meaning given by Article 208ZE(11);

Abolition of requirements to hold meetings: individual insolvency

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• (1) After Article 345 insert—