Creditors’ consideration of CVA proposals—the position under the Insolvency (England and Wales) Rules 2016
Produced in partnership with William Willson of South Square Chambers
Creditors’ consideration of CVA proposals—the position under the Insolvency (England and Wales) Rules 2016

The following Restructuring & Insolvency practice note produced in partnership with William Willson of South Square Chambers provides comprehensive and up to date legal information covering:

  • Creditors’ consideration of CVA proposals—the position under the Insolvency (England and Wales) Rules 2016
  • General
  • Voting rights
  • Contingent creditors
  • Secured creditors
  • Majorities
  • Appeal

General

The Insolvency (England and Wales) Rules 2016 (IR 2016), SI 2016/1024, provide a scheme for decision-making in all insolvency procedures. The detailed provisions for decision-making are set out in IR 2016, SI 2016/1024, Pt 15. For information on decision-making generally, see Practice Note: Voting and creditors' decision procedures—the position under the Insolvency (England and Wales) Rules 2016.

The rules addressing creditors’ decision-making in relation to CVAs are found in IR 2016, SI 2016/1024, Pts 2 and 15. The Corporate Insolvency and Governance Act 2020 (CIGA 2020), in force from 26 June 2020, abolishes the moratorium procedure for small companies under IA 1986, Sch A1 to make way for the new standalone moratorium procedure. For further details, see Practice Notes: Corporate Insolvency and Governance Act 2020—impact on CVAs and Corporate Insolvency and Governance Act 2020—moratorium.

The starting point is that nominee must invite the creditors to consider the proposal by way of a decision procedure. The nominee must deliver to each creditor a notice in respect of the decision procedure which complies with IR 2016, SI 2016/1024, r 15.8 so far as relevant. The notice must be accompanied by a copy of the proposal, a copy of the statement of affairs or, if the nominee thinks fit, a summary including a list of creditors with the amounts of their debts, and the nominee’s comments on the proposal

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