The Payment and Electronic Money Institution Insolvency (England and Wales) Rules 2021

Electronic delivery by administrator

258

• (1) Where the administrator gives, sends or delivers a notice or other document to any person by electronic means, the notice or document must contain or be accompanied by a statement—

• (a) that the recipient may request a hard copy of the notice or document, and

• (b) specifying a telephone number, e-mail address and postal address which may be used to make that request.

• (2) Where a hard copy of the notice or other document is requested, it must be sent free of charge within five business days of receipt of the request by the administrator.

Use of websites by administrator

259

• (1) This rule applies for the purposes of section 246B.

• (2) Where the administrator is required to give, deliver or send a notice or other document to any person (other than in a case where personal service is required), the administrator may satisfy that requirement by sending that person a notice which contains—

• (a) a statement that the notice or other document is available for viewing and downloading on a website,

• (b) the address of that website together with any password necessary to view and download the notice or other document from that site, and

• (c) a statement that the person to whom the notice is given, delivered or sent may request a hard copy of the notice or other document and specifying a telephone number, e-mail address and postal address which may be used to make that request.

• (3) Where a notice to which this rule applies is sent, the notice or other document to which it relates must—

• (a) be available on the website for a period of not less than two months after the end of the special administration or (if later) the release of the last person to hold office as administrator in the special administration, and

• (b) be in a format that enables it to be downloaded from the website within a reasonable time of a request being made for it to be downloaded.

• (4) Where a hard copy of the document is requested it must be sent free of charge within five business days of the receipt of the request by the administrator.

• (5) Where a document is given, delivered or sent to a person by means of a website in accordance with this rule, it is deemed to have been delivered—

• (a) when the document was first made available on the website, or

• (b) if later, when the notice under paragraph (2) was delivered to that person.

General use of websites to deliver notices and other documents

260

• (1) The administrator may deliver a notice to each person to whom a notice or other document will be required to be given, delivered or sent in the special administration which contains—

• (a) a statement that—

• (i) future notices or other documents in the special administration other than those mentioned in paragraph (2) will be made available for viewing and downloading on a website without notice to the recipient, and

• (ii) the administrator will not be obliged to deliver, give or send any such notices or other documents to the recipient of the notice unless it is requested by that person,

• (b) a statement that the recipient of the notice may at any time request a hard copy of any or all of the following—

• (i) all notices and other documents currently available for viewing on the website,

• (ii) all future documents which may be made available there,

• (c) a telephone number, email address and postal address which may be used to make a request for a hard copy of a notice or other document, and

• (d) the address of the website, any password required to view and download a relevant document from that site.

• (2) A statement under paragraph (1)(a) does not apply to the following notices or other documents—

• (a) a notice or other document for which personal delivery is required,

• (b) a notice under rule 116 of intention to declare a dividend, and

• (c) a notice or other document which is not delivered, given or sent generally.

• (3) A notice or other document is delivered, given or sent generally if it is delivered, given or sent to some or all of the following classes of persons—

• (a) members;

• (b) contributories;

• (c) creditors;

• (d) customers;

• (e) any class of members, contributories, customers or creditors.

• (4) An administrator who has delivered a notice under paragraph (1) is under no obligation—

• (a) to notify a person to whom the notice has been delivered when a notice or other document to which the notice applies has been made available on the website, or

• (b) to deliver a hard copy of such a notice or other document unless a request is received under paragraph (1)(b).

• (5) An administrator who receives a request under paragraph (1)(b)—

• (a) in respect of a notice or other document which is already available on the website must deliver a hard copy of the notice or other document to the recipient free of charge within five business days of receipt of the request, and

• (b) in respect of all future notices or other documents must deliver each such notice or other document in accordance with the requirements for delivery of such a notice or other document in the Regulations and these Rules.

• (6) A document to which a statement under paragraph (1)(a) applies must—

• (a) remain available on the website for a period of not less than two months after the end of the special administration or (if later) the release of the last person to hold office as administrator in the special administration, and

• (b) must be in a format that enables it to be downloaded within a reasonable time of a request being made for it to be downloaded.

• (7) A notice or other document which is delivered to a person by means of a website in accordance with this rule, is deemed to have been delivered—

• (a) when that notice or other document was first made available on the website, or

• (b) if later, when the notice under paragraph (1) was delivered to that person.

• (8) Paragraph (7) does not apply in respect of a person who has made a request under paragraph (1)(b)(ii) for hard copies of all future documents.

Electronic delivery of special administration documents to court

261

• (1) A notice or other document may not be delivered to a court by electronic means unless expressly permitted by the CPR, a practice direction, or these Rules.

• (2) A document delivered to the court by electronic means is to be treated as delivered to the court at the time it is recorded by the court as having been received or otherwise as the CPR, a practice direction or these Rules provide.

Notice etc to joint administrators

262

Where there are joint office-holders in a special administration, delivery of a document to one of them is to be treated as delivery to all of them.

Execution overtaken by judgment debtor’s insolvency

263

• (1) This rule applies where execution has been taken out against property of a judgment debtor, and notice is given to the enforcement officer or other officer charged with the execution that the judgment debtor has entered special administration.

• (2) Subject to rule 264, the notice must be delivered to the office of the enforcement officer or of the officer charged with the execution—

• (a) by hand, or

• (b) by any other means of delivery which enables proof of receipt of the document at the relevant address.

Notice to enforcement officers

264

• (1) This rule applies in relation to any provision of the Regulations or these Rules which makes provision for the giving of notice to an enforcement officer.

• (2) Any notice under paragraph (1) may be given by electronic means to any person who has been authorised to receive such notice on behalf of a specified enforcement officer or on behalf of enforcement officers generally.

Electronic submission of information

265

• (1) A requirement under these Rules for prescribed information to be sent by any person to the Secretary of State, the Chief Land Registrar or the administrator shall be treated as having been satisfied where—

• (a) the information is submitted electronically with the agreement of the person to whom the information is sent,

• (b) the form in which the electronic submission is made satisfies the requirements of the person to whom the information is sent,

• (c) all the prescribed information is provided in the electronic submission, and

• (d) the person to whom the information is sent can provide in legible form the information so submitted.

• (2) Where prescribed information is permitted to be sent electronically under paragraph (1), any requirement that the information be accompanied by a signature is taken to be satisfied—

• (a) if the identity of the person who is supplying the information and whose signature is required is confirmed in a manner specified by the recipient, or

• (b) where no such manner has been specified by the recipient, if the communication contains or is accompanied by a statement of the identity of the person who is providing the information, and the recipient has no reason to doubt the truth of that statement.

• (3) Where prescribed information has been supplied to a person, whether or not it has been supplied electronically in accordance with paragraph (2), and a copy of that information is required to be supplied to another person falling within paragraph (1), the requirements contained in paragraph (2) apply in respect of the supply of the copy to that other person, as they apply in respect of the original.

Contents of notices to be gazetted

266

• (1) Subject to rule 268, where under the Regulations or these Rules a notice is gazetted, in addition to any content specifically required by the Regulations or any other provision of these Rules, the content of such a notice must be as set out in paragraph (2) and rule 267.

• (2) All gazetted notices must specify insofar as it is applicable in relation to the particular notice—

• (a) a statement that the proceedings are being held in the court and the court reference number,

• (b) the name, business address and date of appointment of the administrator,

• (c) either an e-mail address, or a telephone number, through which the administrator may be contacted,

• (d) the name of any person other than the administrator (if any) who may be contacted regarding the proceedings, and

• (e) the IP number of the administrator.

Gazette notices relating to an institution that is a company

267

In addition to the information required by rule 266 a notice relating to an institution that is a company must specify—

• (a) the registered name of the institution,

• (b) its registered number,

• (c) its registered office,

• (d) any principal trading address if this is different from its registered office,

• (e) any name under which it was registered in the twelve months prior to the date on which the institution entered special administration, and

• (f) any name or style (other than its registered name) under which—

• (i) the institution carried on business,

• (ii) the institution received relevant funds from a customer, or

• (iii) any debt owed to a creditor was incurred.

Omission of unobtainable information

268

Information required under rule 266 or 267 to be included in a notice to be gazetted may be omitted if it is not reasonably practicable to obtain it.

The Gazette — general

269

• (1) A copy of the Gazette containing any notice required by the Regulations or these Rules to be gazetted is evidence of any facts stated in the notice.

• (2) In the case of an order of the court notice of which is required by the Regulations or these Rules to be gazetted, a copy of the Gazette containing the notice may in any proceedings be produced as conclusive evidence that the order was made on the date specified in the notice.

• (3) Where—

• (a) an order of the court which is gazetted has been varied, or

• (b) any matter has been erroneously or inaccurately gazetted,

the person whose responsibility it was to procure the requisite entry in the Gazette must as soon as is reasonably practicable cause the variation of the order to be gazetted or a further entry to be made in the Gazette for the purpose of correcting the error or inaccuracy.

Content of notices advertised other than in the Gazette

270

• (1) Subject to rule 272, where under the Regulations or these Rules a notice may be advertised otherwise than in the Gazette, in addition to any content specifically required by the Regulations or any other provision of these Rules, the content of such a notice must be as set out in paragraph and rule 271.

• (2) All notices published must specify insofar as it is applicable in relation to the particular notice—

• (a) the name and business address of the administrator acting in the special administration to which the notice relates, and

• (b) either an e-mail address, or a telephone number, through which the administrator may be contacted.

Non-Gazette notice relating to an institution that is a company

271

In addition to the information required by rule 270, a notice relating to an institution that is a company must state—

• (a) the registered name of the institution,

• (b) its registered number,

• (c) any name under which it was registered in the twelve months prior to the date on which the institution entered special administration, and

• (d) any name or style (other than its registered name) under which—

• (i) the institution carried on business,

• (ii) the institution received relevant funds from a customer, or

• (iii) any debt owed to a creditor was incurred.

Non-Gazette notices — other provisions

272

• (1) The information required to be contained in a notice to which rules 270 and 271 apply must be included in the advertisement of that notice in a manner that is reasonably likely to ensure, in relation to the form of the advertising used, that a person reading, hearing or seeing the advertisement will be able to read, hear or see that information.

• (2) Information required under rule 270 or 271 to be included in a notice may be omitted if it is not reasonably practicable to obtain it.

CHAPTER 4 — Notifications to the registrar of companies

Application of Chapter 4

273

This Chapter applies where a return, notice, document or other information is to be sent or delivered to the registrar of companies under the Regulations or these Rules. For the purposes of this Chapter, “notification” means any return, notice, document or other information which is to be sent or delivered to the registrar of companies,

Information to be contained in all notifications to the registrar of companies

274

• (1) A notification to be sent to the registrar of companies under the Regulations or these Rules must specify—

• (a) the registered name of the institution;

• (b) its registered number;

• (c) the nature of the notification;

• (d) the regulation or the rule under which the notification is made;

• (e) the date of the notification;

• (f) the name and postal address of the person sending or delivering the notification;

• (g) the capacity in which that person is acting in respect of the institution.

• (2) The notification must be authenticated by the person sending or delivering the notification.

Notification relating to the administrator

275

In addition to the information required by rule 274, a notification relating to the office of the administrator must also specify—

• (a) the name and business address of the administrator,

• (b) the date of the event notified,

• (c) where the notification relates to an appointment, the person, body or court making the appointment, and

• (d) where the notification relates to the termination of an appointment, the reason for that termination (for example, resignation).

Notifications relating to documents

276

In addition to the information required by rule 274, a notification relating to a document other than a court order must also specify—

• (a) the nature of the document, and

• (b) either—

• (i) the date of the document, or

• (ii) where the document relates to a period of time, the period of time to which the document relates.

Notifications relating to court orders

277

In addition to the information required by rule 274, a notification relating to a court order must also specify—

• (a) the nature of the court order, and

• (b) the date of the order.

Notifications relating to other events

278

In addition to the information required by rule 274, a notification relating to any other event (for example the coming into force of a moratorium) must specify—

• (a) the nature of the event including the regulation or rule under which it took place, and

• (b) the date the event occurred.

Notifications of more than one nature

279

A notification which includes two or more of the types of notification set out in rules 274 to 278 must satisfy the requirements applying in respect of each of those notifications.

Notifications made to other persons at the same time

280

• (1) Where under the Regulations or these Rules a notification is to be sent to another person at the same time that it is to be sent to the registrar of companies, that requirement may be satisfied by sending to that other person a copy of the notification sent to the registrar of companies.

• (2) Paragraph (1) does not apply—

• (a) where additional information is prescribed for the notification to the other person, or

• (b) where the notification to the registrar of companies is incomplete.

CHAPTER 5 — Further provisions concerning documents

Confidentiality of documents — grounds for refusing inspection

281

• (1) The administrator may refuse inspection of a document which forms part of the records of the special administration by a person who would otherwise be entitled to inspect it where the administrator considers that the document—

• (a) should be treated as confidential, or

• (b) is of such a nature that its disclosure would be prejudicial to the conduct of the special administration or might reasonably be expected to lead to violence against any person.

• (2) The persons to whom the administrator may refuse inspection under this rule include members of the creditors’ committee.

• (3) Where under this rule the administrator determines to refuse inspection of a document, the person wishing to inspect it may apply to the court for that determination to be overruled and the court may either overrule it altogether or sustain it subject to such conditions (if any) as it thinks just.

Right to copy documents

282

Where the Regulations or these Rules confer a right for any person to inspect documents, the right includes that of obtaining copies of those documents, on payment—

• (a) in the case of documents on the court’s file of proceedings, of the fee chargeable under any order made under section 92 of the Courts Act 2003²⁸, and

• (b) in any other case, of the appropriate fee.

Charges for copy documents

283

Except where prohibited by these Rules, the administrator is entitled to require the payment of the appropriate fee for the supply of documents requested by a creditor, customer, member, contributory or member of the creditors’ committee.

Right to have list of creditors

284

• (1) A creditor has the right to require the administrator to provide a list of the creditors and the amounts of their respective debts unless paragraph (5) applies.

• (2) The administrator on being required to furnish the list under paragraph (1)—

• (a) must send it to the person requiring the list to be furnished as soon as is reasonably practicable, and

• (b) may charge the appropriate fee for doing so.

• (3) Where any of the creditors of the institution are either—

• (a) employees or former employees of the institution, or

• (b) consumers claiming amounts paid in advance for the supply of goods or services,

the list furnished under paragraph (2) shall state the number of employees or former employees of the institution and the total of the debts owed to them, and the number of consumers claiming amounts paid in advance for the supply of goods or services and the total of the debts owed to them, but shall not include the names and addresses of such creditors.

• (4) The name and address of any creditor may be omitted from the list furnished under paragraph (2) where the administrator is of the view that its disclosure would be prejudicial to the conduct of the proceedings or might reasonably be expected to lead to violence against any person provided that—

• (a) the amount of the debt in question is shown in the list, and

• (b) a statement is included in the list that the name and address of the creditor has been omitted in respect of that debt.

• (5) Paragraph (1) does not apply where a statement of affairs has been delivered to the registrar of companies.

CHAPTER 6 — Time limits and security

Time limits

285

• (1) The provisions of CPR rule 2.8²⁹ apply, as regards computation of time, to anything required or authorised to be done by these Rules.

• (2) The provisions of CPR rule 3.1(2)(a) apply so as to enable the court to extend or shorten the time for compliance with anything required or authorised to be done by these Rules.

Administrator’s security

286

• (1) Wherever under these Rules any person has to appoint or certify the appointment of an administrator, that person must, before making or certifying the appointment, be satisfied that the person appointed or to be appointed has security for the proper performance of that office.

• (2) It is the duty of the creditors’ committee to review from time to time the adequacy of the administrator’s security.

• (3) The cost of the administrator’s security must be paid as an expense of the proceedings.

CHAPTER 7 — Transfer of proceedings

Proceedings commenced in the wrong court

287

Where a special administration is commenced in a court other than the High Court, that court may order the transfer of the proceedings to the High Court.

Proceedings other than special administration commenced

288

• (1) The FCA may apply to the court to order that the proceedings be converted to a special administration where—

• (a) a winding up order or an administration order has been made in respect of an institution, or

• (b) a resolution has been made for the winding up of or for the appointment of an administrator of an institution.

• (2) In making an order under paragraph (1) the court may give such directions as it sees fit, including directions as to the former officer-holder’s remuneration and expenses.

• (3) An application under paragraph (1) may be made without notice.

• (4) Without prejudice to the generality of the court’s power in paragraph (2), where the person appointed as office-holder under the original proceedings (“P”) is not the same person as the administrator in the special administration, the court may direct that—

• (a) P be sent a copy of the order under paragraph (1) by the administrator,

• (b) P hand over—

• (i) the records of the original proceedings, including correspondence, proofs and other related papers appertaining to those proceedings while they were within P’s responsibility,

• (ii) the institution’s books, papers and other records, and

• (iii) all the assets of the institution and the relevant funds held by the institution in P’s possession.

• (5) In this rule –

• (a) “office-holder” means provisional liquidator, liquidator or administrator as the case may be, and

• (b) “original proceedings” means the proceedings following the making of the winding up order, the administration order or the resolution referred to in paragraph (1).

PART 13 — General interpretation and application

Introduction

289

Any definition given in this Part applies except and in so far as the context otherwise requires.

“The court” and “the registrar”

290

• (1) Anything to be done under or by virtue of the Regulations or these Rules by, to or before the court may be done by, to or before a judge or the registrar.

• (2) The registrar may authorise any act of a formal or administrative character which is not by statute the registrar’s responsibility to be carried out by the chief clerk or any other officer of the court acting on the registrar’s behalf, in accordance with directions given by the Lord Chancellor.

Remote attendance at meetings and venue

291

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

• (2) Reference to a “venue”—

• (a) in relation to any proceeding or attendance before the court is to the time, date and place or platform for the proceeding or attendance,

• (b) in relation to an examination under rule 235 is to the time, date and place for the examination, and

• (c) in relation to a meeting—

• (i) is to the time, date and place for the meeting, or

• (ii) in the case of a meeting to be conducted and held in accordance with rule 80(2) or section 246A(3) of the IA 1986, is to the time and date for the meeting and the arrangements the administrator proposes to enable persons to exercise their rights to speak and vote at the meeting.

Insolvent estate

292

References to “the insolvent estate” are to the institution’s assets.

The appropriate fee

293

”The appropriate fee” means 15 pence per A4 or A5 page, and 30 pence per A3 page.

“Debt” and “liability”

294

• (1) Subject to paragraph (2), “debt” means any of the following—

• (a) any debt or liability to which the institution is subject on the date on which the institution entered special administration,

• (b) any debt or liability to which the institution may become subject after that date by reason of any obligation incurred before that date, and

• (c) any interest provable as mentioned in rule 135.

• (2) In paragraph (1)(a), the reference to debt or liability includes a shortfall claim even if the shortfall claim is incurred after the date on which the institution entered special administration.

• (3) For the purposes of any provision of the Regulations or these Rules, any liability in tort is a debt provable in the special administration, if either—

• (a) the cause of action has accrued at the date on which the institution went into special administration, or

• (b) all the elements necessary to establish the cause of action exist at that date except for actionable damage.

• (4) For the purposes of references in any provision of the Regulations or these Rules to a debt or liability, it is immaterial whether the debt or liability is present or future, whether it is certain or contingent, or whether its amount is fixed or liquidated, or is capable of being ascertained by fixed rules or as a matter of opinion, and references in any such provision to owing a debt are to be read accordingly.

• (5) In any provision of the Regulations or these Rules, except in so far as the context otherwise requires, “liability” means (subject to paragraph (3)) a liability to pay money or money’s worth, including any liability under an enactment, any liability for breach of trust, any liability in contract, tort or bailment, and any liability arising out of an obligation to make restitution.

Application of the IA 1986 and the Company Directors Disqualification Act

295

For the purposes of these Rules, any reference in IA 1986 or the Company Directors Disqualification Act 1986³⁰ to “leave” of the court is to be construed as meaning “permission” of the court.

SCHEDULE — Punishment of offences

Rule creating offence	General nature of offence	Mode of prosecution	Punishment	Daily default fine (where applicable)
Rule 88	Administrator failing to send a progress report	Summary	Level 3 on the standard scale	One-tenth of level 3 on the standard scale
Rule 181	Failure to comply with administrator’s duties on vacating office	Summary	Level 3 on the standard scale	One-tenth of level 3 on the standard scale
Rule 247	False representation of status for purpose of inspecting documents	1. On indictment	2 years imprisonment or a fine, or both
		2. Summary	6 months imprisonment, or a fine, or both

Signed

Signed by authority of the Lord Chancellor

Wolfson of Tredegar — Parliamentary Under Secretary of State — Ministry of Justice — 2021-10-19

We concur

Rebecca Harris — Alan Mak — Two of the Lords Commissioners of Her Majesty’s Treasury — 2021-10-21

I concur

Sir Julian Flaux — The Chancellor of the High Court — 2021-10-15

Explanatory note

(This note is not part of the Rules)

EXPLANATORY NOTE

These Rules set out the procedure for the payment institution special administration process or electronic money institution special administration process (as the case may be) under the Payment and Electronic Money Institution Insolvency Regulations 2021 (“the Regulations”).

The main features of the special administration process in each case are that:

• (a) an administrator is appointed, and the institution enters special administration, by court order;

• (b) special administration objectives and procedures apply;

• (c) specific provision is made about how those procedures apply to small institutions;

• (d) the administrator is to pursue the special administration objectives in accordance with the statement of proposals; and

in other respects the procedure is the same as for administration under Schedule B1 to the Insolvency Act 1986, subject to modifications and the inclusion of certain liquidation provisions of that Act. Part 2 of the Rules sets out the procedure for applying for a special administration order.

Part 3 of the Rules sets out the process of the special administration.

Part 4 of the Rules provides for the expenses of the special administration.

Part 5 of the Rules sets out the rules concerning relevant funds claims.

Part 6 of the Rules provides for the pursuit of Objective 1.

Part 7 of the Rules provides for distributions to creditors.

Part 8 of the Rules sets out rules concerning the administrator.

Part 9 of the Rules provides for the end of the special administration.

Part 10 of the Rules sets out court procedure and practice.

Part 11 of the Rules provides for the application of section 216 of the Insolvency Act 1986(prohibited names).

Part 12 of the Rules contains provisions of general effect.

Part 13 of the Rules provides for general interpretation and application.

The Rules apply to institutions incorporated as companies as well as to institutions that are:

• (a) limited liability partnerships by virtue of paragraph 5 of Schedule 1 of the Regulations which applies the Rules with such modifications as the context requires for giving effect to the Regulations; or

• (b) partnerships by virtue of paragraph 9 of Schedule 2 to the Regulations which applies Article 18 of and Schedule 10 to the Insolvent Partnerships Order 1994 (S.I. 1994/2421).

A de minimis impact assessment of the effect these Rules will have on business and the voluntary sector is available from HM Treasury, 1 Horseguards Road, London SW1A 2HQ or on www.gov.uk and is published alongside these Rules on www.legislation.gov.uk.

Footnotes

Editorial notes