Benefits of a scheme of arrangement compared to other processes
Produced in partnership with Riccardo Alonzi and Jonathan Akinluyi of Skadden Arps Slate Meagher & Flom (UK) LLP
Benefits of a scheme of arrangement compared to other processes

The following Restructuring & Insolvency practice note Produced in partnership with Riccardo Alonzi and Jonathan Akinluyi of Skadden Arps Slate Meagher & Flom (UK) LLP provides comprehensive and up to date legal information covering:

  • Benefits of a scheme of arrangement compared to other processes

IP COMPLETION DAY: 11pm (GMT) on 31 December 2020 marks the end of the Brexit transition/implementation period entered into following the UK’s withdrawal from the EU. At this point in time (referred to in UK law as ‘IP completion day’), key transitional arrangements come to an end and significant changes begin to take effect across the UK’s legal regime. This document contains guidance on subjects impacted by these changes. Before continuing your research, see Practice Note: What does IP completion day mean for R&I?

The table below compares the features and benefits of a scheme of arrangement (see: Schemes of arrangement—overview) with two alternate processes available in England and Wales, the company voluntary arrangement (CVA) (see: Company voluntary arrangements—overview) and administration (see: Administration—overview).

While CVAs and schemes are truly alternatives, in that they cannot be jointly pursued, administration is a distinct insolvency process that may be combined with either a scheme or CVA.

Scheme of arrangementCVAAdministration
Control of process
A scheme of arrangement is not a formal insolvency proceeding and the making of an application for the court in a scheme has no effect on the management of the company.A CVA is implemented under the supervision of the nominee/supervisor, who must be an insolvency practitioner; however, the directors remain in control of the company.An administration is a formal
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