The following Restructuring & Insolvency guidance note provides comprehensive and up to date legal information covering:
Administration is a procedure designed to give an entity breathing space, with a view to either a rescue or a restructure or to allow for a better outcome for all creditors than a liquidation. The statutory objectives of an administration (in order of priority) are:
a rescue of the company as a going concern
a better outcome for creditors as a whole than would be likely if the company were wound up
a realisation of the company’s assets to make a distribution to one or more secured or preferential creditors
In practice, rescuing the company as a going concern is unlikely to be achievable and instead the administrator will seek the rescue of the business (rather than the corporate entity) in pursuance of the second statutory objective (achieving a better outcome for creditors as a whole).
An administrator can be appointed over a company, a partnership or a limited liability partnership. For the purposes of this introductory guide we are discussing company administrations only. For further information on partnerships, see Practice Notes: Administration of a Limited Liability Partnership and Insolvency of general partnerships—administration.
As of exit day (31 January 2020) the UK is no longer an EU Member State. However, in accordance with the Withdrawal Agreement, the UK has entered an implementation period, during which it continues to be subject
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