Small Business, Enterprise and Employment Act 2015—impact on insolvency

Small Business, Enterprise and Employment Act 2015—impact on insolvency

The Small Business, Enterprise and Employment Act 2015 (SBEEA 2015) has introduced a number of changes to the law relating to companies and insolvency.

What is the significance of SBEEA 2015 for insolvency professionals?

SBEEA 2015 received Royal Assent on 26 March 2015 and introduced a series of amendments and legislative clarifications intended to ensure that the UK continues to be recognised globally as a trusted and fair place to do business and to open up new opportunities for small businesses to innovate and compete. This has brought in a number of changes to companies and insolvency to ensure a strong regulatory regime for those that administer insolvencies.

Insolvency professionals should be aware of these changes as they have an impact on many aspects of insolvency practice and procedures, and the directors disqualification regime. Most of the changes brought about under SBEEA 2015 will be introduced by separate statutory instrument, but some are effective from 26 May 2015 (see Commencement below).

Directors disqualification (SBEEA 2015, ss 104–111 and Sch 7)

The main changes to the Company Directors Disqualification Act 1996 brought about by SBEEA 2015 are:

  • to require insolvency practitioners (IPs) to report to the Secretary of State (SoS) on the conduct of every director of a company that becomes insolvent
  • to require the report to describe any conduct which may assist the SoS in deciding whether it is in the public interest to apply for the making of a disqualification order
  • to require courts to consider a wider range of matters than previously, including the director’s track record, and the nature of those who have suffered due to the misconduct, when deciding whether or not to disqualify
  • to enable disqualification proceedings to be taken in the UK where there has been misconduct, or directors have been convicted, in overseas companies
  • to enable proceedings to be taken against a person who has caused a

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About the author:

Stephen qualified as a solicitor in 2005 and joined the Restructuring and Insolvency team at Lexis®PSL in September 2014 from Shoosmiths LLP, where he was a senior associate in the restructuring and insolvency team.

Primarily focused on contentious and advisory corporate and personal insolvency work, Stephen’s experience includes acting for office-holders on a wide range of issues, including appointments, investigations and the recovery and realisation of assets (including antecedent transaction claims), and for creditors in respect of the impact on them of the insolvency of debtors and counterparties.