CIGA 2020 definition

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Ordinary resolutions—checklist

Ordinary resolutions—checklist This checklist presents three key tables: • Resolutions specified as ordinary resolutions under CA 2006 • Resolutions which are commonly passed as ordinary resolutions, and • Ordinary resolutions which must be filed with Companies House Ordinary resolutions The Companies Act 2006 (CA 2006) specifies certain matters that must be effected by ordinary resolution (ie simple majority) passed by the members of a company, eg the removal of a director. CA 2006 also specifies certain matters which must be effected by special resolution of the company or where the relevant threshold for effecting a matter is 75%. Where CA 2006 states that something must be done by passing a resolution but does not specify what type of resolution, an ordinary resolution will be adequate (unless the articles of association specify any higher majority or unanimity). Note that: • anything done by ordinary resolution may also be done by special resolution, and • in addition to complying with the requirements of CA 2006 and the company's articles of association (which...

Differences between restructuring plans, schemes of arrangement, and CVAs

Differences between restructuring plans, schemes of arrangement, and CVAs Part 26A restructuring plans The Corporate Insolvency and Governance Act 2020 (CIGA 2020) introduced a new restructuring tool, namely a Part 26A restructuring plan. Consultation responses and discussions with stakeholders persuaded the government of the benefits of modelling the restructuring plan procedure on that of schemes of arrangements. As well as familiarity, this had the advantage of providing a long-established and tested body of jurisprudence that courts are able to draw upon when dealing with certain aspects of restructuring plans and considering matters such as class formation (ie relevant scheme case law is applicable to certain provisions of the new restructuring plan procedure, see: Schemes of arrangement—overview). CIGA 2020 introduced a restructuring procedure that allows a company to bind all creditors or members, including junior (or senior) classes of creditors even if they vote against the plan, through the use of a cross-class cram down (CCCD) provision if certain conditions are satisfied (see Practice Note: Cross-Class Cram Down under a Part...

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Crystallisation of floating charges

Crystallisation of floating charges The key feature of a floating charge is that, until it crystallises, the chargor is entitled to deal with the charged assets in the normal course of business without any further consent from the chargee. By contrast, a fixed charge requires the chargee to exercise a significant degree of control over the charged asset. This Practice Note examines: • the effect of crystallisation of a floating charge • types of event that trigger or may trigger crystallisation, including automatic crystallisation, and • partial crystallisation For further detail on the nature of fixed and floating charges, see Practice Note: Fixed and floating charges. For information on the advantages and disadvantages of floating charges, see Practice Note: Floating charges—advantages and disadvantages. For information on how to take a floating charge, see Practice Note: Floating charges. See also Security—frequently asked questions. The effect of crystallisation Impact of crystallisation on priority Upon crystallisation of a floating charge, the floating charge attaches to all existing assets that are within...

Harmonising insolvencies and restructurings: impact on England

Harmonising insolvencies and restructurings: impact on England Why harmonisation is needed The divergence between various countries’ insolvency laws has an impact on: • the recovery rates of creditors in different jurisdictions • investment decisions, and • the restructuring of groups of companies A more coherent approach should not only improve returns to creditors and the flow of cross-border investment, but also have a positive impact on entrepreneurship, employment and innovation. The World Bank has in the past produced substantial reports to show improved insolvency laws promote greater investment in that country (see Practice Note: Table of advantages and disadvantages of restructuring in various jurisdictions worldwide and News Analysis: Coronavirus (COVID-19)—A nucleus for significant reform), and discrepancies between national frameworks lead to increased costs and uncertainties in assessing the risks of investing in another country (as noted by the European Systemic Risk Board (ESRB); see: LNB News 12/05/2025 17). The Regulation (EU) 2015/848 (OJ L141 5.6.2015 p 19), Recast Regulation on Insolvency [EU Recast Regulation on Insolvency]...

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Proposal for voluntary arrangement made by administrator of the company

Proposal for voluntary arrangement made by administrator of the company IN THE MATTER OF [company name] (in administration) PURSUANT TO SECTION 1 OF THE INSOLVENCY ACT 1986 AND THE INSOLVENCY (ENGLAND AND WALES) RULES 2016 Summary Following heavy trading losses and the appointment by the High Court on [date] of [name] and [name] both of [name of firm], Chartered Accountants of [address] as joint administrators, [name] Ltd (the Company) needs to implement the refinancing proposals set out in the statement of proposals below failing which the administrators must report the position to the Court and a winding up order may be made. The Proposals include: 1 [A placing to raise £[number] (before expenses)]. 2 [A strengthened management team]. 3 [The closure and sale of the Company’s factory at [address]]. Creditors and shareholders are strongly urged to vote in favour of the proposals in the course of the qualifying decision making procedure which [nominees] of [address] are required as nominees to commence pursuant to the Insolvency (England and...

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What is the effect of section 14 of the Corporate Insolvency and Governance Act 2020 for contracts for the supply of goods and/or services?

Commercial Analysis: James Petts, barrister at The 36 Group, discusses the effects of section 14 of the Corporate Insolvency and Governance Act 2020 (CIGA 2020) for the supply of goods and services. The analysis touches upon the differing protection available to customers and suppliers, and provides practical guidance for contracting parties in the process of negotiating and drafting new agreements.