Legalize / United Kingdom / Public General Act

Insolvency Act 1986

Type Public General Act

Publication 1986-07-25

Last updated 2026-02-02

State In force

Department Statute Law Database

Source legislation.gov.uk

articles Not indexed

Reform history JSON API

(b) does not have permission under Part 4A of the Financial Services and Markets Act 2000 (c. 8) (regulated activities) to accept deposits.

(1A) Subsection (1)(b) shall be construed in accordance with—

(a) section 22 of the Financial Services and Markets Act 2000 (classes of regulated activity and categories of investment),

(b) any relevant order under that section, and

(1A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2) An order under this section may make different provision for different cases and may contain such incidental, supplemental and transitional provisions as may appear to the Secretary of State necessary or expedient.

(3) An order under this section shall be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.

Meaning of “relevant offence”

422A

In this Part “relevant offence” means a criminal offence punishable with imprisonment for more than two years or punishable on summary conviction with imprisonment for more than three months or with a fine of more than level 5 on the standard scale (if not calculated on a daily basis) or with a fine of more than £100 a day.

Part XVI — Provisions Against Debt Avoidance (England and Wales only)

Transactions defrauding creditors.

423

(1) This section relates to transactions entered into at an undervalue; and a person enters into such a transaction with another person if—

(a) he makes a gift to the other person or he otherwise enters into a transaction with the other on terms that provide for him to receive no consideration;

(b) he enters into a transaction with the other in consideration of marriage or the formation of a civil partnership; or

(c) he enters into a transaction with the other for a consideration the value of which, in money or money’s worth, is significantly less than the value, in money or money’s worth, of the consideration provided by himself.

(2) Where a person has entered into such a transaction, the court may, if satisfied under the next subsection, make such order as it thinks fit for—

(a) restoring the position to what it would have been if the transaction had not been entered into, and

(b) protecting the interests of persons who are victims of the transaction.

(3) In the case of a person entering into such a transaction, an order shall only be made if the court is satisfied that it was entered into by him for the purpose—

(a) of putting assets beyond the reach of a person who is making, or may at some time make, a claim against him, or

(b) of otherwise prejudicing the interests of such a person in relation to the claim which he is making or may make.

(4) In this section “the court” means the High Court or—

(a) if the person entering into the transaction is an individual, any other court which would have jurisdiction in relation to a bankruptcy petition relating to him;

(b) if that person is a body capable of being wound up under Part IV or V of this Act, any other court having jurisdiction to wind it up.

(5) In relation to a transaction at an undervalue, references here and below to a victim of the transaction are to a person who is, or is capable of being, prejudiced by it; and in the following two sections the person entering into the transaction is referred to as “the debtor”.

Those who may apply for an order under s. 423.

424

(1) An application for an order under section 423 shall not be made in relation to a transaction except—

(a) in a case where the debtor has been made bankrupt or is a body corporate which is being wound up or is in administration, by the official receiver, by the trustee of the bankrupt’s estate or the liquidator or adminstrator of the body corporate or (with the leave of the court) by a victim of the transaction;

(b) in a case where a victim of the transaction is bound by a voluntary arrangement approved under Part I or Part VIII of this Act, by the supervisor of the voluntary arrangement or by any person who (whether or not so bound) is such a victim; or

(2) An application made under any of the paragraphs of subsection (1) is to be treated as made on behalf of every victim of the transaction.

Provision which may be made by order under s. 423.

425

(1) Without prejudice to the generality of section 423, an order made under that section with respect to a transaction may (subject as follows)—

(a) require any property transferred as part of the transaction to be vested in any person, either absolutely or for the benefit of all the persons on whose behalf the application for the order is treated as made;

(b) require any property to be so vested if it represents, in any person’s hands, the application either of the proceeds of sale of property so transferred or of the money so transferred;

(d) require any person to pay to any other person in respect of benefits received from the debtor such sums as the court may direct;

(e) provide for any surety or guarantor whose obligations to any person were released or discharged (in whole or in part) under the transaction to be under such new or revived obligations as the court thinks appropriate;

(f) provide for security to be provided for the discharge of any obligation imposed by or arising under the order, for such an obligation to be charged on any property and for such security or charge to have the same priority as a security or charge released or discharged (in whole or in part) under the transaction.

(2) An order under section 423 may affect the property of, or impose any obligation on, any person whether or not he is the person with whom the debtor entered into the transaction; but such an order—

(a) shall not prejudice any interest in property which was acquired from a person other than the debtor and was acquired in good faith, for value and without notice of the relevant circumstances, or prejudice any interest deriving from such an interest, and

(b) shall not require a person who received a benefit from the transaction in good faith, for value and without notice of the relevant circumstances to pay any sum unless he was a party to the transaction.

(3) For the purposes of this section the relevant circumstances in relation to a transaction are the circumstances by virtue of which an order under section 423 may be made in respect of the transaction.

(4) In this section “security” means any mortgage, charge, lien or other security.

Part XVII — Miscellaneous and General

Co-operation between courts exercising jurisdiction in relation to insolvency.

426

(1) An order made by a court in any part of the United Kingdom in the exercise of jurisdiction in relation to insolvency law shall be enforced in any other part of the United Kingdom as if it were made by a court exercising the corresponding jurisdiction in that other part.

(2) However, without prejudice to the following provisions of this section, nothing in subsection (1) requires a court in any part of the United Kingdom to enforce, in relation to property situated in that part, any order made by a court in any other part of the United Kingdom.

(3) The Secretary of State, with the concurrence in relation to property situated in England and Wales of the Lord Chancellor, may by order make provision for securing that a trustee or assignee under the insolvency law of any part of the United Kingdom has, with such modifications as may be specified in the order, the same rights in relation to any property situated in another part of the United Kingdom as he would have in the corresponding circumstances if he were a trustee or assignee under the insolvency law of that other part.

(4) The courts having jurisdiction in relation to insolvency law in any part of the United Kingdom shall assist the courts having the corresponding jurisdiction in any other part of the United Kingdom or any relevant country or territory.

(5) For the purposes of subsection (4) a request made to a court in any part of the United Kingdom by a court in any other part of the United Kingdom or in a relevant country or territory is authority for the court to which the request is made to apply, in relation to any matters specified in the request, the insolvency law which is applicable by either court in relation to comparable matters falling within its jurisdiction.

In exercising its descretion under this subsection, a court shall have regard in particular to the rules of private international law.

(6) Where a person who is a trustee or assignee under the insolvency law of any part of the United Kingdom claims property situated in any other part of the United Kingdom (whether by virtue of an order under subsection (3) or otherwise), the submission of that claim to the court exercising jurisdiction in relation to insolvency law in that other part shall be treated in the same manner as a request made by a court for the purpose of subsection (4).

(7) Section 38 of the Criminal Law Act 1977 (execution of warrant of arrest throughout the United Kingdom) applies to a warrant which, in exercise of any jurisdiction in relation to insolvency law, is issued in any part of the United Kingdom for the arrest of a person as it applies to a warrant issued in that part of the United Kingdom for the arrest of a person charged with an offence.

(8) Without prejudice to any power to make rules of court, any power to make provision by subordinate legislation for the purpose of giving effect in relation to companies or individuals to the insolvency law of any part of the United Kingdom includes power to make provision for the purpose of giving effect in that part to any provision made by or under the preceding provisions of this section.

(9) An order under subsection (3) shall be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.

(10) In this section “insolvency law” means—

(a) in relation to England and Wales, provision extending to England and Wales and made by or under this Act or sections 1A 6 to 10, 12 to 15, 19(c) and 20 (with Schedule 1) of the Company Directors Disqualification Act 1986 and sections 1 to 17 of that Act as they apply for the purposes of those provisions of that Act;

(b) in relation to Scotland, provision extending to Scotland and made by or under this Act, sections 1A 6 to 10, 12 to 15, 19(c) and 20 (with Schedule 1) of the Company Directors Disqualification Act 1986 and sections 1 to 17 of that Act as they apply for the purposes of those provisions of that Act, Part XVIII of the Companies Act or the Bankruptcy (Scotland) Act 2016;

(c) in relation to Northern Ireland, provision made by or under the Insolvency (Northern Ireland) Order 1989or the Company Directors Disqualification (Northern Ireland) Order 2002;

(d) in relation to any relevant country or territory, so much of the law of that country or territory as corresponds to provisions falling within any of the foregoing paragraphs;

and references in this subsection to any enactment include, in relation to any time before the coming into force of that enactment the corresponding enactment in force at that time.

(11) In this section “relevant country or territory” means—

(a) any of the Channel Islands or the Isle of Man, or

(b) any country or territory designated for the purposes of this section by the Secretary of State by order made by statutory instrument.

(12) In the application of this section to Northern Ireland—

(a) for any reference to the Secretary of State there is substituted a reference to the Department of Economic Development in Northern Ireland;

(b) in subsection (3) for the words “another part of the United Kingdom” and the words “that other part” there is substituted the words “Northern Ireland”;

(9) An order made under subsection (3) by the Department of Economic Development in Northern Ireland shall be a statutory rule for the purposes of the Statutory Rules (Northern Ireland) Order 1979 and shall be subject to negative resolution within the meaning of section 41(6) of the Interpretation Act (Northern Ireland) 1954.

(13) Section 129 of the Banking Act 2009 provides for provisions of that Act about bank insolvency to be “insolvency law” for the purposes of this section.

(14) Section 165 of the Banking Act 2009 provides for provisions of that Act about bank administration to be “insolvency law” for the purposes of this section.

Disqualification from Parliament (England and Wales and Northern Ireland)

426A

(1) A person in respect of whom a bankruptcy restrictions order or a debt relief restrictions order has effect shall be disqualified—

(a) from membership of the House of Commons,

(b) from sitting or voting in the House of Lords, and

(2) If a member of the House of Commons becomes disqualified under this section, his seat shall be vacated.

(3) If a person who is disqualified under this section is returned as a member of the House of Commons, his return shall be void.

(4) No writ of summons shall be issued to a member of the House of Lords who is disqualified under this section.

(5) If a court makes a bankruptcy restrictions order or interim order , or a debt relief restrictions order or an interim debt relief restrictions order, in respect of a member of the House of Commons or the House of Lords the court shall notify the Speaker of that House.

(6) If the Secretary of State accepts a bankruptcy restrictions undertaking or a debt relief restrictions undertaking made by a member of the House of Commons or the House of Lords, the Secretary of State shall notify the Speaker of that House.

(7) If the Department of Enterprise, Trade and Investment for Northern Ireland accepts a bankruptcy restrictions undertaking made by a member of the House of Commons or the House of Lords under Schedule 2A to the Insolvency (Northern Ireland) Order 1989, the Department shall notify the Speaker of that House.

(8) In this section a reference to a bankruptcy restrictions order or an interim order includes a reference to a bankruptcy restrictions order or an interim order made under Schedule 2A to the Insolvency (Northern Ireland) Order 1989.

Devolution

426B

(1) If a court in England and Wales makes a bankruptcy restrictions order or interim order in respect of a member of the Scottish Parliament, the Northern Ireland Assembly or the National Assembly for Wales, or makes a debt relief restrictions order or interim debt relief restrictions order in respect of such a member, the court shall notify the presiding officer of that body.

(1A) If the High Court in Northern Ireland makes a bankruptcy restrictions order or interim order under Schedule 2A to the Insolvency (Northern Ireland) Order 1989 in respect of a member of the Scottish Parliament or the National Assembly for Wales, the Court shall notify the presiding officer of that body.

(2) If the Secretary of State accepts a bankruptcy restrictions undertaking or a debt relief restrictions undertaking made by a member of the Scottish Parliament, the Northern Ireland Assembly or the National Assembly for Wales, the Secretary of State shall notify the presiding officer of that body.

(3) If the Department of Enterprise, Trade and Investment for Northern Ireland accepts a bankruptcy restrictions undertaking made by a member of the Scottish Parliament or the National Assembly for Wales under Schedule 2A to the Insolvency (Northern Ireland) Order 1989, the Department shall notify the presiding officer of that body.

Irrelevance of privilege

426C

(1) An enactment about insolvency applies in relation to a member of the House of Commons or the House of Lords irrespective of any Parliamentary privilege.

(2) In this section “enactment” includes a provision made by or under—

(a) an Act of the Scottish Parliament, or

(b) Northern Ireland legislation.

Disqualification from Parliament (Scotland ...)

427

(1) Where ... a court in Scotland awards sequestration of an individual’s estate, the individual is disqualified—

(a) for sitting or voting in the House of Lords,

(b) for being elected to, or sitting or voting in, the House of Commons, and

(2) Where an individual is disqualified under this section, the disqualification ceases—

(a) except where the award is recalled or reduced without the individual having been first discharged, on the discharge of the individual, and

(b) in the excepted case, on the ... recall or reduction, as the case may be.

(3) No writ of summons shall be issued to any lord of Parliament who is for the time being disqualified under this section for sitting and voting in the House of Lords.

(4) Where a member of the House of Commons who is disqualified under this section continues to be so disqualified until the end of the period of 6 months beginning with the day of the ... award, his seat shall be vacated at the end of that period.

(5) A court which makes an ... award such as is mentioned is subsection (1) in relation to any lord of Parliament or member of the House of Commons shall forthwith certify the ... award to the Speaker of the House of Lords or, as the case may be, to the Speaker of the House of Commons.

(6) Where a court has certified an ... award to the Speaker of the House of Commons under subsection (5), then immediately after it becomes apparent which of the following certificates is applicable, the court shall certify to the Speaker of the House of Commons—

(a) that the period of 6 months beginning with the day of the ... award has expired without the ... award having been ..., recalled or reduced, or

(b) that the ... award has been ..., recalled or reduced before the end of that period.

(6A) Subsections (4) to (6) have effect in relation to a member of the Scottish Parliament but as if—

(a) references to the House of Commons were to the Parliament and references to the Speaker were to the Presiding Officer, and

(b) in subsection (4), for “under this section” there were substituted “under section 15(1)(b) of the Scotland Act 1998 by virtue of this section”.

(6B) Subsections (4) to (6) have effect in relation to a member of the National Assembly for Wales but as if—

(a) references to the House of Commons were to the Assembly and references to the Speaker were to the presiding officer, and

(b) in subsection (4), for “under this section” there were substituted “under section 16(A1)(a) of the Government of Wales Act 2006 and paragraph 4 of Schedule 1A to that Act”.

(6C) Subsections (4) to (6) have effect in relation to a member of the Northern Ireland Assembly but as if—

(a) references to the House of Commons were to the Assembly and references to the Speaker were to the Presiding Officer; and

(b) in subsection (4), for “under this section” there were substituted “ under section 36(4) of the Northern Ireland Act 1998 by virtue of this section ”.

(7) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Exemptions from Restrictive Trade Practices Act.

428

(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) In this section “insolvency services” means the services of persons acting as insolvency practitioners or carrying out under the law of Northern Ireland functions corresponding to those mentioned in section 388(1) or (2) in Part XIII, in their capacity as such . . ..

Disabilities on revocation of administration order against an individual.

429

(1) The following applies where a person fails to make any payment which he is required to make by virtue of an administration order under Part VI of the County Courts Act 1984.

(2) The court which is administering that person’s estate under the order may, if it thinks fit—

(a) revoke the administration order, and

(b) make an order directing that this section and section 12 of the Company Directors Disqualification Act 1986 shall apply to the person for such period, not exceeding one year, as may be specified in the order.

(3) A person to whom this section so applies shall not—

(a) either alone or jointly with another person, obtain credit to the extent of the amount prescribed for the purposes of section 360(1)(a) or more, or

(b) enter into any transaction in the course of or for the purposes of any business in which he is directly or indirectly engaged,

without disclosing to the person from whom he obtains the credit, or (as the case may be) with whom the transaction is entered into, the fact that this section applies to him.

(4) The reference in subsection (3) to a person obtaining credit includes—

(a) a case where goods are bailed or hired to him under a hire-purchase agreement or agreed to be sold to him under a conditional sale agreement, and

(b) a case where he is paid in advance (whether in money or otherwise) for the supply of goods or services.

(5) A person who contravenes this section is guilty of an offence and liable to imprisonment or a fine, or both.

Provision introducing Schedule of punishments.

430

(1) Schedule 10 to this Act has effect with respect to the way in which offences under this Act are punishable on conviction.

(2) In relation to an offence under a provision of this Act specified in the first column of the Schedule (the general nature of the offence being described in the second column), the third column shows whether the offence is punishable on conviction on indictment, or on summary conviction, or either in the one way or the other.

(3) The fourth column of the Schedule shows, in relation to an offence, the maximum punishment by way of fine or imprisonment under this Act which may be imposed on a person convicted of the offence in the way specified in relation to it in the third column (that is to say, on indictment or summarily) a reference to a period of years or months being to a term of imprisonment of that duration.

(4) The fifth column shows (in relation to an offence for which there is an entry in that column) that a person convicted of the offence after continued contravention is liable to a daily default fine; that is to say, he is liable on a second or subsquent conviction of the offence to the fine specified in that column for each day on which the contravention is continued (instead of the penalty specified for the offence in the fourth column of the Scheudule).

(4A) In relation to an offence committed before 2 May 2022, a reference in Schedule 10 to 12 months on summary conviction in England and Wales is to be read as a reference to 6 months.

(5) For the purpose of any enactment in this Act whereby an officer of a company who is in default is liable to a fine or penalty, the expression “officer who is in default” means any officer of the company who knowingly and wilfully authorises or permits the default, refusal or contravention mentioned in the enactment.

Summary proceedings.

431

(1) Summary proceedings for any offence under any of Parts A1 to VII of this Act may (without prejudice to any jurisdiction exercisable apart from this subsection) be taken against a body corporate at any place at which the body has a place of business, and against any other person at any place at which he is for the time being.

(2) Notwithstanding anything in section 127(1) of the Magistrates’ Courts Act 1980, an information relating to such an offence which is triable by a magistrates’ court in England and Wales may be so tried if it is laid at any time within 3 years after the commission of the offence and within 12 months after the date on which evidence sufficient in the opinion of the Director of Public Prosecutions or the Secretary of State (as the case may be) to justify the proceedings comes to his knowledge.

(3) Summary proceedings in Scotland for such an offence shall not be commenced after the expiration of 3 years from the commission of the offence.

Subject to this (and notwithstanding anything in section 136 of the Criminal Procdure (Scotland) Act 1995), such proceedings may (in Scotland) be commenced at any time within 12 months after the date on which evidence sufficient in the Lord Advocate’s opinion to justify the proceedings came to his knowledge or, where such evidence was reported to him by the Secretary of State, within 12 months after the date on which it came to the knowledge of the latter; and subsection (3) of that section applies for the purpose of this subsection as it applies for the purpose of that section.

(4) For purposes of this section, a certificate of the Director of Public Prosecutions, the Lord Advocate or the Secretary of State (as the case may be) as to the date on which such evidence as is referred to above came to his knowledge is conclusive evidence.

Offences by bodies corporate.

432

(1) This section applies to offences under this Act other than those excepted by subsection (4).

(2) Where a body corporate is guilty of an offence to which this section applies and the offence is proved to have been committed with the consent or connivance of, or to be attributable to any neglect on the part of, any director, manager, secretary or other similar officer of the body corporate or any person who was purporting to act in any such capacity he, as well as the body corporate, is guilty of the offence and liable to be proceeded against and punished accordingly.

(3) Where the affairs of a body corporate are managed by its members, subsection (2) applies in relation to the acts and defaults of a member in connection with his functions of management as if he were a director of the body corporate.

(4) The offences excepted from this section are those under sections A19(5), A25(3), A26(4), A27(1), A28(5), A29(6), A30(2), A31(10), A32(4), 30, 39, 51, 53, 54, 62, 64, 66, 85, 89, 164, 188, 201, 206, 207, 208, 209, 210 and 211 ....

Admissibility in evidence of statements of affairs, etc.

433

(1) In any proceedings (whether or not under this Act)—

(a) a statement of affairs prepared for the purposes of any provision of this Act which is derived from the Insolvency Act 1985,

(aa) a statement made in pursuance of a requirement imposed by or under Part 2 of the Banking Act 2009 (bank insolvency),

(ab) a statement made in pursuance of a requirement imposed by or under Part 3 of that Act (bank administration), and

(b) any other statement made in pursuance of a requirement imposed by or under any such provision or by or under rules made under this Act,

may be used in evidence against any person making or concurring in making the statement.

(2) However, in criminal proceedings in which any such person is charged with an offence to which this subsection applies—

(a) no evidence relating to the statement may be adduced, and

(b) no question relating to it may be asked,

by or on behalf of the prosecution, unless evidence relating to it is adduced, or a question relating to it is asked, in the proceedings by or on behalf of that person.

(3) Subsection (2) applies to any offence other than—

(a) an offence under section 22(6), 47(6), 48(8), 66(6), 67(8), 95(8), ... 99(3), 131(7), 192(2), 208(1)(a) or (d) or (2), 210, 235(5), 353(1), 354(1)(b) or (3) or 356(1) or (2)(a) or (b) or paragraph 4(3)(a) of Schedule 7;

(b) an offence which is—

(i) created by rules made under this Act, and

(ii) designated for the purposes of this subsection by such rules or by regulations made by the Secretary of State;

(i) created by regulations made under any such rules, and

(ii) designated for the purposes of this subsection by such regulations;

(d) an offence under section 1, 2 or 5 of the Perjury Act 1911 (false statements made on oath or made otherwise than on oath); or

(e) an offence under section 44(1) or (2) of the Criminal Law (Consolidation) (Scotland) Act 1995 (false statements made on oath or otherwise than on oath).

(4) Regulations under subsection (3)(b)(ii) shall be made by statutory instrument and, after being made, shall be laid before each House of Parliament.

Crown application.

434

For the avoidance of doubt it is hereby declared that provisions of this Act which derive from the Insolvency Act 1985 and Part A1 and sections 233A and 233B and Schedule 4ZZA bind the Crown so far as affecting or relating to the following matters, namely—

(a) remedies against, or against the property of, companies or individuals;

(b) priorities of debts;

(d) voluntary arrangements approved under Part I or Part VIII, and

(e) discharge from bankruptcy.

PART 17A — SUPPLEMENTARY PROVISIONS

Introductory

434A

The provisions of this Part have effect for the purposes of—

(a) the First Group of Parts, and

(b) sections 411, 413, 414, 416 and 417 in Part 15.

Representation of corporations in decision procedures and at meetings

434B

(1) If a corporation is a creditor or debenture-holder, it may by resolution of its directors or other governing body authorise a person or persons to act as its representative or representatives—

(a) in a qualifying decision procedure, held in pursuance of this Act or of rules made under it, by which a decision is sought from the creditors of a company, or

(b) at any meeting of a company held in pursuance of the provisions contained in a debenture or trust deed.

(2) Where the corporation authorises only one person, that person is entitled to exercise the same powers on behalf of the corporation as the corporation could exercise if it were an individual creditor or debenture-holder.

(3) Where the corporation authorises more than one person, any one of them is entitled to exercise the same powers on behalf of the corporation as the corporation could exercise if it were an individual creditor or debenture-holder.

(4) Where the corporation authorises more than one person and more than one of them purport to exercise a power under subsection (3)—

(a) if they purport to exercise the power in the same way, the power is treated as exercised in that way;

(b) if they do not purport to exercise the power in the same way, the power is treated as not exercised.

Legal professional privilege

434C

In proceedings against a person for an offence under this Act nothing in this Act is to be taken to require any person to disclose any information that he is entitled to refuse to disclose on grounds of legal professional privilege (in Scotland, confidentiality of communications).

Enforcement of company's filing obligations

434D

(1) This section applies where a company has made default in complying with any obligation under this Act—

(a) to deliver a document to the registrar, or

(b) to give notice to the registrar of any matter.

(2) The registrar, or any member or creditor of the company, may give notice to the company requiring it to comply with the obligation.

(3) If the company fails to make good the default within 14 days after service of the notice, the registrar, or any member or creditor of the company, may apply to the court for an order directing the company, and any specified officer of it, to make good the default within a specified time.

(4) The court's order may provide that all costs (in Scotland, expenses) of or incidental to the application are to be borne by the company or by any officers of it responsible for the default.

(5) This section does not affect the operation of any enactment imposing penalties on a company or its officers in respect of any such default.

Application of filing obligations to overseas companies

434E

The provisions of this Act requiring documents to be forwarded or delivered to, or filed with, the registrar of companies apply in relation to an overseas company that is required to register particulars under section 1046 of the Companies Act 2006 as they apply in relation to a company registered under that Act in England and Wales or Scotland.

Part XVIII — Interpretation

Meaning of “associate”.

435

(1) For the purposes of this Act any question whether a person is an associate of another person is to be determined in accordance with the following provisions of this section (any provision that a person is an associate of another person being taken to mean that they are associates of each other).

(2) A person is an associate of an individual if that person is—

(a) the individual’s husband or wife or civil partner,

(b) a relative of—

(i) the individual, or

(ii) the individual’s husband or wife or civil partner, or

(i) the individual, or

(ii) the individual’s husband or wife or civil partner.

(3) A person is an associate of any person with whom he is in partnership, and of the husband or wife or civil partner or a relative of any individual with whom he is in partnership; and a Scottish firm is an associate of any person who is a member of the firm.

(4) A person is an associate of any person whom he employs or by whom he is employed.

(5) A person in his capacity as trustee of a trust other than—

(a) a trust arising under any of the second Group of Parts or the Bankruptcy (Scotland) Act 2016, or

(b) a pension scheme or an employees’ share scheme . . . ,

is an associate of another person if the beneficiaries of the trust include, or the terms of the trust confer a power that may be exercised for the benefit of, that other person or an associate of that other person.

(6) A company is an associate of another company—

(a) if the same person has control of both, or a person has control of one and persons who are his associates, or he and persons who are his associates, have control of the other, or

(b) if a group of two or more persons has control of each company, and the groups either consist of the same persons or could be regarded as consisting of the same persons by treating (in one or more cases) a member of either group as replaced by a person of whom he is an associate.

(7) A company is an associate of another person if that person has control of it or if that person and persons who are his associates together have control of it.

(8) For the purposes of this section a person is a relative of an individual if he is that individual’s brother, sister, uncle, aunt, nephew, niece, lineal ancestor or lineal descendant, treating—

(a) any relationship of the half blood as a relationship of the whole blood and the stepchild or adopted child of any person as his child, and

(b) an illegitimate child as the legitimate child of his mother and reputed father;

and references in this section to a husband or wife include a former husband or wife and a reputed husband or wife and references to a civil partner include a former civil partnerand a reputed civil partner.

(9) For the purposes of this section any director or other officer of a company is to be treated as employed by that company.

(10) For the purposes of this section a person is to be taken as having control of a company if—

(a) the directors of the company or of another company which has control of it (or any of them) are accustomed to act in accordance with his directions or instructions, or

(b) he is entitled to exercise, or control the exercise of, one third or more of the voting power at any general meeting of the company of or another company which has control of it;

and where two or more persons together satisfy either of the above conditions, they are to be taken as having control of the company.

(11) In this section “company” includes any body corporate (whether incorporated in Great Britain or elsewhere); and references to directors and other officers of a company and to voting power at any general meeting of a company have effect with any necessary modifications.

Expressions used generally.

436

(1) In this Act, except in so far as the context otherwise requires (and subject to Parts VII and XI)—

“agricultural charge” has the same meaning as in the Agricultural Credits Act 1928;

“agricultural receiver” means a receiver appointed under an agricultural charge;

“the appointed day” means the day of which this Act comes into force under section 443;

“associate” has the meaning given by section 435;

“body corporate” includes a body incorporated outside Great Britain, but does not include—a corporation sole, ora partnership that, whether or not a legal person, is not regarded as a body corporate under the law by which it is governed;

“business” includes a trade or profession;

“the Companies Act” means the Companies Act 1985;

“the Companies Acts” means the Companies Acts (as defined in section 2 of the Companies Act 2006) as they have effect in Great Britain;

“conditional sale agreement” and “hire-purchase agreement” have the same meanings as in the Consumer Credit Act 1974;

“corporate member” means an insolvent member which is a company;

“the court”, in relation to an insolvent partnership, means the court which has jurisdiction to wind up the partnership;

“distress” includes use of the procedure in Schedule 12 to the Tribunals, Courts and Enforcement Act 2007, and references to levying distress, seizing goods and related expressions shall be construed accordingly;

“the EU Regulation” means Regulation (EU) 2015/848 of the European Parliament and of the Council of 20 May 2015 on insolvency proceedings as it forms part of domestic law on and after exit day;

“EEA State” means a state that is a Contracting Party to the Agreement on the European Economic Area signed at Oporto on 2nd May 1992 as adjusted by the Protocol signed at Brussels on 17th March 1993;

“employees' share scheme” means a scheme for encouraging or facilitating the holding of shares in or debentures of a company by or for the benefit of—the bona fide employees or former employees of—the company,any subsidiary of the company, orthe company's holding company or any subsidiary of the company's holding company, orthe spouses, civil partners, surviving spouses, surviving civil partners, or minor children or step-children of such employees or former employees.

“individual member” means an insolvent member who is an individual;

“insolvency order” means—in the case of an insolvent partnership or a corporate member, a winding-up order; andin the case of an individual member, a bankruptcy order;

“insolvency petition” means, in the case of a petition presented to the court—against a corporate member, a petition for its winding up by the court;against an individual member, a petition for a bankruptcy order to be made against that individual,where the petition is presented in conjunction with a petition for the winding up of the partnership by the court as an unregistered company under the Act;

“insolvency proceedings” means any proceedings under the Act, this Order or the Insolvency Rules 1986

“insolvent member” means a member of an insolvent partnership, against whom an insolvency petition is being or has been presented;

“joint bankruptcy petition” means a petition by virtue of article 11 of this Order;

“joint debt” means a debt of an insolvent partnership in respect of which an order is made by virtue of Part IV or V of this Order;

“joint estate” means the partnership property of an insolvent partnership in respect of which an order is made by virtue of Part IV or V of this Order;

“joint expenses” means expenses incurred in the winding up of an insolvent partnership or in the winding up of the business of an insolvent partnership and the administration of its property;

“limited partner” has the same meaning as in the Limited Partnerships Act 1907;

“member” means a member of a partnership and any person who is liable as a partner within the meaning of section 14 of the Partnership Act 1890;

“modifications” includes additions, alterations and omissions and cognate expressions shall be construed accordingly;

“officer”, in relation to an insolvent partnership, means—a member; ora person who has management or control of the partnership business;

“partnership property” has the same meaning as in the Partnership Act 1890;

“postponed debt” means a debt the payment of which is postponed by or under any provision of the Act or of any other enactment;

“property” includes money, goods, things in action, land and every description of property wherever situated and also obligations and every description of interest, whether present or future or vested or contingent, arising out of, or incidental to, property;

“records” includes computer records and other non-documentary records;

“responsible insolvency practitioner” means—in winding up, the liquidator of an insolvent partnership or corporate member; andin bankruptcy, the trustee of the estate of an individual member,and in either case includes the official receiver when so acting;

“separate debt” means a debt for which a member of a partnership is liable, other than a joint debt;

“separate estate” means the property of an insolvent member against whom an insolvency order has been made;

“separate expenses” means expenses incurred in the winding up of a corporate member, or in the bankruptcy of an individual member; and

“subordinate legislation” has the same meaning as in the Interpretation Act 1978; and

“transaction” includes a gift, agreement or arrangement, and references to entering into a transaction shall be construed accordingly.

“trustee of the partnership” means a person authorised by order made by virtue of article 11 of this Order to wind up the business of an insolvent partnership and to administer its property.

(2) The following expressions have the same meaning in this Act as in the Companies Acts—

“articles”, in relation to a company (see section 18 of the Companies Act 2006);

“debenture” (see section 738 of that Act);

“holding company” (see sections 1159 and 1160 of, and Schedule 6 to, that Act);

“the Joint Stock Companies Acts” (see section 1171 of that Act);

“overseas company” (see section 1044 of that Act);

“paid up” (see section 583 of that Act);

“private company” and “public company” (see section 4 of that Act);

“registrar of companies” (see section 1060 of that Act);

“share” (see section 540 of that Act);

“subsidiary” (see sections 1159 and 1160 of, and Schedule 6 to, that Act).

Proceedings under EU Regulations: modified definition of property

436A

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

References to things in writing

436B

(1) A reference in this Act to a thing in writing includes that thing in electronic form.

(2) Subsection (1) does not apply to the following provisions—

(a) section 53 (mode of appointment by holder of charge),

(b) section 67(2) (report by receiver),

(d) section 111(2) (dissent from arrangement under s. 110),

(e) in the case of a winding up of a company registered in Scotland, section 111(4),

(f) section 123(1) (definition of inability to pay debts),

(g) section 198(3) (duties of sheriff principal as regards examination),

(h) section 222(1) (inability to pay debts: unpaid creditor for £750 or more), and

(i) section 223 (inability to pay debts: debt remaining unsatisfied after action brought).

Part XIX — Final Provisions

Transitional provisions, and savings.

437

The transitional provisions and savings set out in Schedule 11 to this Act shall have effect, the Schedule comprising the following Parts—

Part I: company insolvency and winding up (matters arising before appointed day, and continuance of proceedings in certain cases as before that day);

Part II: individual insolvency (matters so arising, and continuance of bankruptcy proceedings in certain cases as before that day);

Part III: transactions entered into before the appointed day and capable of being affected by orders of the court under Part XVI of this Act;

Part IV: insolvency practitioners acting as such before the appointed day; and

Part V: general transitional provisions and savings required consequentially on, and in connection with, the repeal and replacement by this Act and the Company Directors Disqualification Act 1986 of provisions of the Companies Act 1985, the greater part of the Insolvency Act 1985 and other enactments.

Repeals.

438

The enactments specified in the second column of Schedule 12 to this Act are repealed to the extent specified in the third column of that Schedule.

Amendment of enactments.

439

(1) The Companies Act is amended as shown in Parts I and II of Schedule 13 to this Act, being amendments consequential on this Act and the Company Directors Disqualification Act 1986.

(2) The enactments specified in the first column of Schedule 14 to this Act (being enactments which refer, or otherwise relate, to those which are repealed and replaced by this Act or the Company Directors Diqualification Act 1986) are amended as shown in the second column of that Schedule.

(3) The Lord Chancellor may by order make such consequential modifications of any provision contained in any subordinate legislation made before the appointed day and such transitional provisions in connection with those modifications as appear to him necessary or expedient in respect of—

(a) any reference in that subordinate legislation to the Bankruptcy Act 1914;

(b) any reference in that subordinate legislation to any enactment repealed by Part III or IV or Schedule 10 to the Insolvency Act 1985; or

(c) any reference in that subordinate legislation to any matter provided for under the Act of 1914 or under any enactment so repealed.

(4) An order under this section shall be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.

Extent (Scotland).

440

(1) Subject to the next subsection, provisions of this Act contained in the first Group of Parts extend to Scotland except where otherwise stated.

(2) The following provisions of this Act do not extend to Scotland—

(a) in the first Group of Parts—

section 43;

sections 238 to 241; and

section 246;

(b) the second Group of Parts;

sections 399 to 402,

sections 412, 413, 415, 415A(3), 418, 420 and 421,

sections 423 to 425, and

section 429(1) and (2); and

(d) in the Schedules—

Parts II and III of Schedule 11; and

Schedules 12 and 14 so far as they repeal or amend enactments which extend to England and Wales only.

Extent (Northern Ireland).

441

(1) The following provisions of this Act extend to Northern Ireland—

(a) sections 197, 426, 426A, 426B, 427 and 428; and

(b) so much of section 439 and Schedule 14 as relates to enactments which extend to Northern Ireland.

(2) Subject as above, and to any provision expressly relating to companies incorporated elsewhere than in Great Britain, nothing in this Act extends to Northern Ireland or applies to or in relation to companies registered or incorporated in Northern Ireland.

Extent (other territories).

442

Her Majesty may, by Order in Council, direct that such of the provisions of this Act as are specified in the Order, being provisions formerly contained in the Insolvency Act 1985, shall extend to any of the Channel Islands or any colony with such modifications as may be so specified.

Commencement.

443

This Act comes into force on the day appointed under section 236(2) of the Insolvency Act 1985 for the coming into force of Part III of that Act (individual insolvency and bankruptcy), immediately after that Part of that Act comes into force for England and Wales.

Citation.

444

This Act may be cited as the Insolvency Act 1986.

SCHEDULE ZA1

Eligible companies

1

A company is “eligible” for the purposes of this Part unless it is excluded from being eligible by any of the following—

paragraph 2 (current or recent insolvency procedure);

paragraph 2A (private registered providers of social housing);

paragraph 2B (a registered social landlord under Part 2 of the Housing (Scotland) Act 2010);

paragraph 3 (insurance companies);

paragraph 4 (banks);

paragraph 5 (electronic money institutions);

paragraph 6 (investment banks and investment firms);

paragraph 7 (market contracts, market charges, etc);

paragraph 8 (participants in designated systems);

paragraph 9 (payment institutions);

paragraph 10 (operators of payment systems, infrastructure providers etc);

paragraph 11 (recognised investment exchanges, clearing houses and CSDs);

paragraph 12 (securitisation companies);

paragraph 13 (parties to capital market arrangements);

paragraph 15 (public-private partnership project companies);

paragraph 18 (certain overseas companies).

Companies subject to, or recently subject to, moratorium or an insolvency procedure

2

(1) A company is excluded from being eligible if—

(a) on the filing date, a moratorium for the company is in force, or

(b) at any time during the period of 12 months ending with the filing date, a moratorium for the company was in force (but see section A42(6) for power of the court to modify the effect of this paragraph).

(2) A company is excluded from being eligible if—

(a) on the filing date, the company is subject to an insolvency procedure, or

(b) at any time during the period of 12 months ending with the filing date, the company was subject to an insolvency procedure within sub-paragraph (3)(a) or (b).

(3) For the purposes of sub-paragraph (2), a company is subject to an insolvency procedure at any time if at that time—

(a) a voluntary arrangement has effect in relation to the company,

(b) the company is in administration,

(d) there is an administrative receiver of the company,

(e) there is a provisional liquidator of the company,

(f) the company is being wound up, or

(g) a relevant petition for the winding up of the company has been presented and has not been withdrawn or determined.

(4) In sub-paragraph (3)(g) “relevant petition” means a petition under—

(a) section 124A (winding up on grounds of public interest),

(b) section 124B (winding up of SE), or

2A

A company is excluded from being eligible if it is a private registered provider of social housing.

2B

A company is excluded from being eligible if it is a registered social landlord under Part 2 of the Housing (Scotland) Act 2010.

Insurance companies

3

(1) A company is excluded from being eligible if—

(a) it carries on the regulated activity of effecting or carrying out contracts of insurance, and

(b) it is not an exempt person in relation to that activity.

(2) In this paragraph—

“exempt person”, in relation to a regulated activity, has the meaning given by section 417 of the Financial Services and Markets Act 2000;

“regulated activity” has the meaning given by section 22 of that Act, taken with Schedule 2 to that Act and any order under that section.

Banks

4

(1) A company is excluded from being eligible if—

(a) it has permission under Part 4A of the Financial Services and Markets Act 2000 to carry on the regulated activity of accepting deposits,

(b) it is a banking group company within the meaning of Part 1 of the Banking Act 2009 (see section 81D of that Act), or

(c) it has a liability in respect of a deposit which it accepted in accordance with the Banking Act 1979 or the Banking Act 1987.

(2) In sub-paragraph (1)(a) “regulated activity” has the meaning given by section 22 of the Financial Services and Markets Act 2000, taken with Schedule 2 to that Act and any order under that section.

Electronic money institutions

5

A company is excluded from being eligible if it is an electronic money institution within the meaning of the Electronic Money Regulations 2011 (S.I. 2011/99) (see regulation 2 of those Regulations).

Investment banks and investment firms

6

(1) A company is excluded from being eligible if it is an investment bank or an investment firm.

(2) In this paragraph—

“investment bank” means a company that has permission under Part 4A of the Financial Services and Markets Act 2000 to carry on the regulated activity of—safeguarding and administering investments,managing an AIF or a UCITS,acting as trustee or depositary of an AIF or a UCITS,dealing in investments as principal, ordealing in investments as agent,but does not include a company that has permission to arrange for one or more others to carry on the activity mentioned in paragraph (a) if it does not otherwise have permission to carry on any of the activities mentioned in paragraphs (a) to (e);

“investment firm” has the same meaning as in the Banking Act 2009 (see section 258A of that Act), disregarding any order made under section 258A(2)(b) of that Act;

“regulated activity” has the meaning given by section 22 of the Financial Services and Markets Act 2000, taken with Schedule 2 to that Act and any order under that section.

Companies that are party to market contracts or subject to market charges, etc

7

(1) A company is excluded from being eligible if it is a party to a market contract for the purposes of Part 7 of the Companies Act 1989 (see section 155 of that Act).

(2) A company is excluded from being eligible if any of its property is subject to a market charge for the purposes of Part 7 of the Companies Act 1989 (see section 173 of that Act).

(3) A company is excluded from being eligible if any of its property is subject to a charge that is a system-charge, within the meaning of the Financial Markets and Insolvency Regulations 1996 (S.I. 1996/1469) (see regulation 2 of those Regulations).

Participants in designated systems

8

A company is excluded from being eligible if—

(a) it is a participant in a designated system, within the meaning of the Financial Markets and Insolvency (Settlement Finality) Regulations 1999 (S.I. 1999/2979) (see regulation 2 of those Regulations), or

(b) any of its property is subject to a collateral security charge within the meaning of those Regulations (see regulation 2 of those Regulations).

Payment institutions

9

A company is excluded from being eligible if it is an authorised payment institution, a small payment institution or a registered account information service provider within the meaning of the Payment Services Regulations 2017 (S.I. 2017/752) (see regulation 2 of those Regulations).

Operators of payment systems, infrastructure providers etc

10

A company is excluded from being eligible if—

(a) it is the operator of a payment system or an infrastructure provider within the meaning of Part 5 of the Financial Services (Banking Reform) Act 2013 (see section 42 of that Act), or

(b) it is an infrastructure company, within the meaning of Part 6 of that Act (see section 112 of that Act).

Recognised investment exchanges, clearing houses and CSDs

11

A company is excluded from being eligible if it is a recognised investment exchange, a recognised clearing house or a recognised CSD within the meaning of the Financial Services and Markets Act 2000 (see section 285 of that Act).

Securitisation companies

12

A company is excluded from being eligible if it is a securitisation company within the meaning of the Taxation of Securitisation Companies Regulations 2006 (S.I. 2006/3296) (see regulation 4 of those Regulations).

Parties to capital market arrangements

13

(1) A company is excluded from being eligible if, on the filing date—

(a) it is a party to an agreement which is or forms part of a capital market arrangement (see sub-paragraph (2)),

(b) a party has incurred, or when the agreement was entered into was expected to incur, a debt of at least £10 million under the arrangement (at any time during the life of the capital market arrangement), and

(2) For the purposes of this paragraph, an arrangement is a “capital market arrangement” if any of the following applies—

(a) it involves a grant of security to a person holding it as trustee for a person who holds a capital market investment issued by a party to the arrangement;

(b) at least one party guarantees the performance of obligations of another party;

(d) the arrangement involves an investment of a kind described in articles 83 to 85 of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (S.I. 2001/544) (options, futures and contracts for differences).

(3) For the purposes of sub-paragraph (2)—

(a) a reference to holding a security as trustee includes a reference to holding it as nominee or agent,

(b) a reference to holding for a person who holds a capital market investment includes a reference to holding for a number of persons at least one of whom holds a capital market investment, and

(4) For the purposes of sub-paragraph (1)(b), where a debt is denominated wholly or partly in a foreign currency, the sterling equivalent is to be calculated as at the time when the arrangement is entered into.

14

(1) For the purposes of paragraph 13 an investment is a “capital market investment” if condition A or B is met.

(2) Condition A is that the investment—

(a) is within article 77 or 77A of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (S.I. 2001/544) (debt instruments), and

(b) is rated, listed or traded or designed to be rated, listed or traded.

(3) In sub-paragraph (2)—

“listed” means admitted to the official list within the meaning given by section 103(1) of the Financial Services and Markets Act 2000 (interpretation);

“rated” means rated for the purposes of investment by an internationally recognised rating agency;

“traded” means admitted to trading on a market established under the rules of a recognised investment exchange or on a foreign market.

(4) In sub-paragraph (3)—

“foreign market” has the same meaning as “relevant market” in article 67(2) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (S.I. 2005/1529) (foreign markets);

“recognised investment exchange” has the meaning given by section 285 of the Financial Services and Markets Act 2000 (recognised investment exchange).

(5) Condition B is that the investment consists of a bond or commercial paper issued to one or more of the following—

(a) an investment professional within the meaning of article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (S.I. 2005/1529);

(b) a person who, when the agreement mentioned in paragraph 13(1) is entered into, is a ... high net worth individual in relation to a communication within the meaning of article 48(2) of that Order;

(d) a person who, when the agreement mentioned in paragraph 13(1) is entered into, is a certified sophisticated investor in relation to a communication within the meaning of article 50(1) of that Order;

(e) a person in a State other than the United Kingdom who under the law of that State is not prohibited from investing in bonds or commercial paper.

(6) For the purposes of sub-paragraph (5)—

(a) in applying article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005—

(i) in article 19(5)(b), ignore the words after “exempt person”,

(ii) in article 19(5)(c)(i), for the words from “the controlled activity” to the end substitute “a controlled activity”, and

(iii) in article 19(5)(e), ignore the words from “where the communication” to the end;

(b) in applying article 49(2) of that Order, ignore article 49(2)(e);

(i) a bond that is within article 77(1) of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001, or

(ii) an alternative finance investment bond within the meaning of article 77A of that Order;

(d) “commercial paper” has the meaning given by article 9(3) of that Order.

Public-private partnership project companies

15

(1) A company is excluded from being eligible if, on the filing date, it is a project company of a project which—

(a) is a public-private partnership project (see paragraph 16), and

(b) includes step-in rights (see paragraph 17).

(2) For the purposes of this paragraph a company is a “project company” of a project if any of the following applies—

(a) it holds property for the purpose of the project;

(b) it has sole or principal responsibility under an agreement for carrying out all or part of the project;

(d) it has the purpose of supplying finance to enable the project to be carried out;

(e) it is the holding company of a company within any of paragraphs (a) to (d).

(3) But a company is not a “project company” of a project if—

(a) it performs a function within sub-paragraph (2)(a) to (d) or is within sub-paragraph (2)(e), but

(b) it also performs a function which is not—

(i) within sub-paragraph (2)(a) to (d),

(ii) related to a function within sub-paragraph (2)(a) to (d), or

(iii) related to the project.

(4) For the purposes of this paragraph a company carries out all or part of a project whether or not it acts wholly or partly through agents.

16

(1) For the purposes of paragraph 15 “public-private partnership project” means a project—

(a) the resources for which are provided partly by one or more public bodies and partly by one or more private persons, or

(b) which is designed wholly or mainly for the purpose of assisting a public body to discharge a function.

(2) In sub-paragraph (1) “public body” means—

(a) a body which exercises public functions,

(b) a body specified for the purposes of this paragraph by the Secretary of State, or

(3) In sub-paragraph (1)(a) “resources” includes—

(a) funds (including payment for the provision of services or facilities);

(b) assets;

(d) the grant of a concession or franchise;

(e) any other commercial resource.

(4) A specification under sub-paragraph (2) may be—

(a) general, or

(b) for the purpose of the application of paragraph 15 to a specified case.

17

(1) For the purposes of paragraph 15 a project has “step-in rights” if a person who provides finance in connection with the project has a conditional entitlement under an agreement to—

(a) assume sole or principal responsibility under an agreement for carrying out all or part of the project, or

(b) make arrangements for carrying out all or part of the project.

(2) In sub-paragraph (1) a reference to the provision of finance includes a reference to the provision of an indemnity.

Overseas companies with corresponding functions

18

A company is excluded from being eligible if its registered office or head office is outside the United Kingdom and—

(a) its functions correspond to those of a company mentioned in any of the previous paragraphs of this Schedule apart from paragraphs 2 and 2A and, if it were a company registered under the Companies Act 2006 in England and Wales or Scotland, it would be excluded from being eligible by that paragraph, or

(b) it has entered into a transaction or done anything else that, if done in England and Wales or Scotland by a company registered under the Companies Act 2006 in England and Wales or Scotland, would result in the company being excluded by any of the previous paragraphs of this Schedule apart from paragraphs 2 and 2A.

Interpretation of Schedule

19

(1) This paragraph applies for the purposes of this Schedule.

(2) “Agreement” includes any agreement or undertaking effected by—

(a) contract,

(b) deed, or

(c) any other instrument intended to have effect in accordance with the law of England and Wales, Scotland or another jurisdiction.

(3) “The filing date” means the date on which documents are filed with the court under section A3, A4 or A5.

(4) “Party” to an arrangement includes a party to an agreement which—

(a) forms part of the arrangement,

(b) provides for the raising of finance as part of the arrangement, or

Powers to amend Schedule

20

(1) The Secretary of State may by regulations amend this Schedule, apart from paragraph 2, so as to alter the circumstances in which a company is “eligible” for the purposes of this Part.

(2) Regulations under this paragraph are subject to the affirmative resolution procedure.

21

(1) The Welsh Ministers may by regulations amend this Schedule—

(a) so as to provide that a social landlord registered under Part 1 of the Housing Act 1996 is excluded from being “eligible” for the purposes of this Part;

(b) so as to reverse the effect of any provision made under paragraph (a).

(2) Regulations under this paragraph extend to England and Wales only.

(3) A statutory instrument containing regulations under this paragraph may not be made unless a draft of the statutory instrument containing them has been laid before and approved by a resolution of Senedd Cymru.

22

(1) The Scottish Ministers may by regulations amend this Schedule—

(a) so as to provide that a social landlord registered under Part 2 of the Housing (Scotland) Act 2010 (asp 17) is excluded from being “eligible” for the purposes of this Part;

(b) so as to reverse the effect of any provision made under paragraph (a).

(2) Regulations under this paragraph extend to Scotland only.

(3) Regulations under this paragraph are subject to the affirmative procedure (see section 29 of the Interpretation and Legislative Reform (Scotland) Act 2010 (asp 10)).

SCHEDULE ZA2

Introductory

1

For the purposes of section A18 “contract or other instrument involving financial services” means a contract or other instrument to which any of the following paragraphs applies.

Financial contracts

2

(1) This paragraph applies to a financial contract.

(2) “Financial contract” means—

(a) a contract for the provision of financial services consisting of—

(i) lending (including the factoring and financing of commercial transactions),

(ii) financial leasing, or

(iii) providing guarantees or commitments;

(b) a securities contract, including—

(i) a contract for the purchase, sale or loan of a security, group or index of securities;

(ii) an option on a security or group or index of securities;

(iii) a repurchase or reverse repurchase transaction on any such security, group or index;

(i) a contract for the purchase, sale or loan of a commodity or group or index of commodities for future delivery;

(ii) an option on a commodity or group or index of commodities;

(iii) a repurchase or reverse repurchase transaction on any such commodity, group or index;

(d) a futures or forwards contract, including a contract (other than a commodities contract) for the purchase, sale or transfer of a commodity or property of any other description, service, right or interest for a specified price at a future date;

(e) a swap agreement, including—

(i) a swap or option relating to interest rates, spot or other foreign exchange agreements, currency, an equity index or equity, a debt index or debt, commodity indexes or commodities, weather, emissions or inflation;

(ii) a total return, credit spread or credit swap;

(iii) any agreement or transaction that is similar to an agreement that is referred to in sub-paragraph (i) or (ii) and is the subject of recurrent dealing in the swaps or derivatives markets;

(f) an inter-bank borrowing agreement where the term of the borrowing is three months or less;

(g) a master agreement for any of the contracts or agreements referred to in paragraphs (a) to (f).

(3) For the purposes of this paragraph “commodities” includes—

(a) units recognised for compliance with the requirements of EU Directive 2003/87/EC establishing a scheme for greenhouse gas emission allowance trading,

(b) allowances under paragraph 5 of Schedule 2 to the Climate Change Act 2008 relating to a trading scheme dealt with under Part 1 of that Schedule (schemes limiting activities relating to emissions of greenhouse gas), and

(i) by the Gas and Electricity Markets Authority under an order made under section 32B of the Electricity Act 1989, or

(ii) by the Northern Ireland Authority for Utility Regulation under the Energy (Northern Ireland) Order 2003 (S.I. 2003/419 (N.I. 6)) and pursuant to an order made under Articles 52 to 55F of that Order.

Securities financing transactions

3

(1) This paragraph applies to—

(a) a securities financing transaction, and

(b) a master agreement for securities financing transactions.

(2) “Securities financing transaction” has the meaning given by Article 3(11) of Regulation (EU) 2015/2365 on the transparency of securities financing transactions.

(3) But for the purposes of that Article as it applies for the purposes of this paragraph, references to “commodities” in that Regulation are to be taken as including the units, allowances and certificates referred to in paragraph 2(3)(a), (b) and (c).

Derivatives

4

(1) This paragraph applies to—

(a) a derivative, and

(b) a master agreement for derivatives.

(2) “Derivative” has the meaning given by Article 2(5) of Regulation (EU) No. 648/2012.

Spot contracts

5

(1) This paragraph applies to—

(a) a spot contract, and

(b) a master agreement for spot contracts.

(2) “Spot contract” has the meaning given by Article 7(2) or 10(2) of Commission Delegated Regulation of 25.4.2016 supplementing Directive 2014/65/EU of the European Parliament and of the Council as regards organisational requirements and operating conditions for investment firms and defined terms for the purposes of that Directive.

Capital market investments

6

(1) This paragraph applies to an agreement which is, or forms part of, an arrangement involving the issue of a capital market investment.

(2) “Capital market investment” has the meaning given by paragraph 14 of Schedule ZA1.

Contracts forming part of a public-private partnership

7

This paragraph applies to a contract forming part of a public-private partnership project within the meaning given by paragraph 16 of Schedule ZA1.

Market contracts

8

This paragraph applies to a market contract within the meaning of Part 7 of the Companies Act 1989 (see section 155 of that Act).

Qualifying collateral arrangements and qualifying property transfers

9

This paragraph applies to qualifying collateral arrangements and qualifying property transfers within the meaning of Part 7 of the Companies Act 1989 (see section 155A of that Act).

Contracts secured by certain charges or arrangements

10

This paragraph applies to a contract where any obligation under the contract is—

(a) secured by a market charge within the meaning of Part 7 of the Companies Act 1989 (see section 173 of that Act),

(b) secured by a system-charge within the meaning of the Financial Markets and Insolvency Regulations 1996 (S.I. 1996/1469) (see regulation 2 of those Regulations), or

(c) secured or otherwise covered by a financial collateral arrangement within the meaning of the Financial Collateral Arrangements (No. 2) Regulations 2003 (S.I. 2003/3226) (see regulation 3 of those Regulations).

Default arrangements and transfer orders

11

This paragraph applies to a contract which is included in default arrangements, or a transfer order, within the meaning of the Financial Markets and Insolvency (Settlement Finality) Regulations 1999 (S.I. 1999/2979) (see regulation 2 of those Regulations).

Card-based payment transactions

12

This paragraph applies to a contract to accept and process card-based payment transactions within the meaning given by Regulation (EU) 2015/751 of the European Parliament and of the Council of 29th April 2015 on interchange fees for card-based payment transactions.

Power to amend Schedule

13

(1) The Secretary of State may by regulations amend this Schedule so as to change the meaning of “contract or other instrument involving financial services” for the purposes of section A18.

(2) Regulations under this paragraph are subject to the affirmative resolution procedure.

SCHEDULE A1

...

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

SCHEDULE B1

ARRANGEMENT OF SCHEDULE

NATURE OF ADMINISTRATION

Administration

1

(1) For the purposes of this Act “administrator” of a company means a person appointed under this Schedule to manage the company’s affairs, business and property.

(2) For the purposes of this Act—

(a) a company is “in administration” while the appointment of an administrator of the company has effect,

(b) a company “enters administration” when the appointment of an administrator takes effect,

(c) a company ceases to be in administration when the appointment of an administrator of the company ceases to have effect in accordance with this Schedule, and

(d) a company does not cease to be in administration merely because an administrator vacates office (by reason of resignation, death or otherwise) or is removed from office.

2

A person may be appointed as administrator of a company—

(a) by administration order of the court under paragraph 10,

(b) by the holder of a floating charge under paragraph 14, or

Purpose of administration

3

(1) The administrator of a company must perform his functions with the objective of—

(a) rescuing the company as a going concern, or

(b) achieving a better result for the company’s creditors as a whole than would be likely if the company were wound up (without first being in administration), or

(2) Subject to sub-paragraph (4), the administrator of a company must perform his functions in the interests of the company’s creditors as a whole.

(3) The administrator must perform his functions with the objective specified in sub-paragraph (1)(a) unless he thinks either—

(a) that it is not reasonably practicable to achieve that objective, or

(b) that the objective specified in sub-paragraph (1)(b) would achieve a better result for the company’s creditors as a whole.

(4) The administrator may perform his functions with the objective specified in sub-paragraph (1)(c) only if—

(a) he thinks that it is not reasonably practicable to achieve either of the objectives specified in sub-paragraph (1)(a) and (b), and

(b) he does not unnecessarily harm the interests of the creditors of the company as a whole.

4

The administrator of a company must perform his functions as quickly and efficiently as is reasonably practicable.

Status of administrator

5

An administrator is an officer of the court (whether or not he is appointed by the court).

General restrictions

6

A person may be appointed as administrator of a company only if he is qualified to act as an insolvency practitioner in relation to the company.

7

A person may not be appointed as administrator of a company which is in administration (subject to the provisions of paragraphs 90 to 97 and 100 to 103 about replacement and additional administrators).

8

(1) A person may not be appointed as administrator of a company which is in liquidation by virtue of—

(a) a resolution for voluntary winding up, or

(b) a winding-up order.

(2) Sub-paragraph (1)(a) is subject to paragraph 38.

(3) Sub-paragraph (1)(b) is subject to paragraphs 37 and 38.

9

(1) A person may not be appointed as administrator of a company which—

(a) has a liability in respect of a deposit which it accepted in accordance with the Banking Act 1979 (c. 37) or 1987 (c. 22), but

(b) is not an authorised deposit taker.

(2) A person may not be appointed as administrator of a company which effects or carries out contracts of insurance.

(3) But sub-paragraph (2) does not apply to a company which—

(a) is exempt from the general prohibition in relation to effecting or carrying out contracts of insurance, or

(b) is an authorised deposit taker effecting or carrying out contracts of insurance in the course of a banking business.

(4) In this paragraph—

“authorised deposit taker” means a person with permission under Part IV of the Financial Services and Markets Act 2000 (c. 8) to accept deposits, and

“the general prohibition” has the meaning given by section 19 of that Act.

(5) This paragraph shall be construed in accordance with—

(a) section 22 of the Financial Services and Markets Act 2000 (classes of regulated activity and categories of investment),

(b) any relevant order under that section, and

APPOINTMENT OF ADMINISTRATOR BY COURT

Administration order

10

An administration order is an order appointing a person as the administrator of a company.

Conditions for making order

11

The court may make an administration order in relation to a company only if satisfied—

(a) that the company is or is likely to become unable to pay its debts, and

(b) that the administration order is reasonably likely to achieve the purpose of administration.

Administration application

12

(1) An application to the court for an administration order in respect of a company (an “administration application”) may be made only by—

(a) the company,

(b) the directors of the company,

Reading this document does not replace reading the official text published on legislation.gov.uk. Contains public sector information licensed under the Open Government Licence v3.0. We assume no responsibility for any inaccuracies arising from the conversion of the original CLML XML to this format.

This text is published under legislation.gov.uk's own terms of reuse, not a Legalize or public-domain licence. legislation.gov.uk
Open Government Licence v3.0 (attribution required)
© Crown and database right. Derived from content available under the Open Government Licence v3.0 from legislation.gov.uk.

Insolvency Act 1986

Meaning of “relevant offence”

422A

Part XVI — Provisions Against Debt Avoidance (England and Wales only)

Transactions defrauding creditors.

423

Those who may apply for an order under s. 423.

424

Provision which may be made by order under s. 423.

425

Part XVII — Miscellaneous and General

Co-operation between courts exercising jurisdiction in relation to insolvency.

426

Disqualification from Parliament (England and Wales and Northern Ireland)

426A

Devolution

426B

Irrelevance of privilege

426C

Disqualification from Parliament (Scotland ...)

427

Exemptions from Restrictive Trade Practices Act.

428

Disabilities on revocation of administration order against an individual.

429

Provision introducing Schedule of punishments.

430

Summary proceedings.

431

Offences by bodies corporate.

432

Admissibility in evidence of statements of affairs, etc.

433

Crown application.

434

PART 17A — SUPPLEMENTARY PROVISIONS

Introductory

434A

Representation of corporations in decision procedures and at meetings

434B

Legal professional privilege

434C

Enforcement of company's filing obligations

434D

Application of filing obligations to overseas companies

434E

Part XVIII — Interpretation

Meaning of “associate”.

435

Expressions used generally.

436

Proceedings under EU Regulations: modified definition of property

436A

References to things in writing

436B

Part XIX — Final Provisions

Transitional provisions, and savings.

437

Repeals.

438

Amendment of enactments.

439

Extent (Scotland).

440

Extent (Northern Ireland).

441

Extent (other territories).

442

Commencement.

443

Citation.

444

SCHEDULE ZA1

Eligible companies

1

Companies subject to, or recently subject to, moratorium or an insolvency procedure

2

Private registered providers of social housing

2A

Registered social landlord under Part 2 of the Housing (Scotland) Act 2010