One minute with Alison Curry, Head of Regulatory Standards & Support at the Insolvency Practitioners Association

Alison read law at the LSE and then studied as a solicitor, prior to entering the insolvency profession in 1996. A Licensed Insolvency Practitioner from a small practice background, specialising in bankruptcy investigations, bespoke IVA and CVA drafting and SME restructuring. Formerly a partner in Pitman Cohen LLP prior to joining the Insolvency Practitioners Association (IPA) Secretariat, initially as a consultant in 2010. Alison has since assisted the IPA with a number of projects, including serving as secretary to the JIC sub-group responsible for the revision of Statements of Insolvency Practice (SIPs) 7 & 9 and the creation of SIP 1; a pilot project to measure empirical IP performance data; the establishment of the IPA’s CPI+ course; and most notably, the publication of the IPA’s Insolvency Practitioners’ Handbook.Alison has been the Head of Regulatory Standards and Support at the IPA since 2012 and assists in the delivery of regulatory assistance to IPA members and its growing program of conferences, courses and events. Alison is a regular speaker on various aspects of insolvency regulation and has a keen interest in economics, politics and current affairs.

What is the current status of the new SIP 16?

The new SIP has been through a lengthy process of refinement and is now in its final approval stages with the Recognised Professional Bodies (RPBs). The Joint Insolvency Committee is looking at an issue date of 01 June 2015, with an effective date of 01 July 2015, to give the Pre-Pack Pool Steering Group time to complete their work in setting up the new pre-pack pool.

What changes will the new SIP 16 make to pre-pack sales in administration?

The most significant change is in respect of the increased emphasis placed on the marketing of the business and the adoption of Teresa Graham’s six “Marketing Essentials”. Other significant changes include requiring the Insolvency Practitioner to make a prospective connected party purchaser aware of their ability to approach the pre-pack pool and the potential for enhanced stakeholder confidence from the connected party approaching the pre-pack pool and preparing a viability statement for the purchasing entity. There is also a stipulation that any valuations obtained should be carried out by appropriate independent valuers and/or advisors, carrying adequate professional indemnity insurance.
Throughout the SIP, there is generally a shift towards a “comply or explain” methodology.

How will the pre-pack pool work?

The intention is that in cases involving connected parties, the prospective purchaser will be encouraged to approach the pool for an independent opinion on whether the transaction is appropriate and in creditors’ best interests. The pool member’s view will not be binding on the administrator, but will form part of the SIP16 disclosure. The opinions will be in the form of one of two standards outcomes, either a ‘no reason not to proceed’ letter or in the alternative a letter indicating that the pool member has not seen sufficient evidence to make that statement.

Which provisions are likely to concern IPs most?

The intention of the SIP is to tackle creditor distrust of pre-packs with increased transparency.

However, consistently, IPs have expressed some concerns about the difficulties that may be encountered in marketing a business whilst avoiding the damage that might flow from publicity of an impending insolvency. The new SIP significantly reinforces the emphasis placed on appropriate marketing and there will be an onus on practitioners to justify departures from the marketing essentials. We would anticipate the need for more transparent marketing to be the most challenging area for practitioners.

What practical guidance will be available?

The SIP itself is a standalone document for IPs to follow when considering a pre-packaged sale. Additional guidance for potential users of the pre-pack pool is being prepared in the form of a Q&A explaining that process for them in greater detail. We intend to include both documents within the latest edition of our handbook.

When/where is the new IPA handbook available? What does it cover?

Our handbook is scheduled for publication in July and will include the Code of Ethics for Insolvency Practitioners, the latest Statements of Insolvency Practice (including SIP16), Insolvency Guidance Papers, our Technical Helpsheets and other non-statutory regulation and guidance, such as our PII and Client Money Regulations.

The Insolvency Practitioners’ Handbook is a “one-stop-shop” for IPs and their professional advisers and will be available via the Lexis on-line bookstore and as an ebook.

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