In our last article on this subject we indicated that we would be seeking to clarify a couple of further issues with the Insolvency Service. We are pleased to say that we have received a response and that further legislative changes are planned which will deal with the issues raised. The Insolvency Service indicate that they intend to implement the following changes as part of the further modernisation planned for 6 April 2010. However, at present these are only proposed changes and so are subject to Parliamentary scrutiny and approval.
1. We raised the issue that the approach taken to advertising general meetings of creditors in bankruptcies differs from that in liquidations and pointed out that in bankruptcies the rule changes introduced gives two levels of discretion; a discretion to give notice of the meeting by advertising as well as written notice and a requirement to gazette if you decide to exercise that discretion; and then, if you gazette, a further discretion to “advertise in such other manner as the convenor thinks fit.” The Insolvency Service indicate that the introduction of mandatory gazetting requirements was reflected generally in the April 2009 Rule changes, but that it has not yet been introduced in rule 6.81(4) for bankruptcies, and that as a result the gazetting requirements in liquidations now differ from those in bankruptcy. They indicate that they intend to introduce a similar mandatory provision into rule 6.81(4) to bring bankruptcy into line with the general policy for insolvency advertising.
2. We also pointed out that our interpretation of the insolvency legislation meant that a consequence of the April 2009 rule changes was to require the gazetting of annual meetings in CVLs for all cases commenced on or after 6 April 2009. The Insolvency Service confirmed that our interpretation was correct, but indicated that they intend to remove the requirement for annual meetings in CVLs. It will be interesting to see if the removal of the requirement to hold annual meetings has retrospective effect, i.e. it will apply to all cases, or if it will only apply to cases commenced on or after 6 April 2010, the planned date of the legislative change. If it is the latter, then this will mean that there will be 12 months of cases where it is necessary to gazette annual meeting, i.e. those commenced between 6 April 2009 and 5 April 2010, and we hope that the regulators will take a pragmatic approach to the enforcement of the legislative requirement in respect of such cases.
