Creditors' decision procedures in administration—the position under the Insolvency (England and Wales) Rules 2016
Produced in partnership with South Square and BDO LLP
Creditors' decision procedures in administration—the position under the Insolvency (England and Wales) Rules 2016

The following Restructuring & Insolvency guidance note Produced in partnership with South Square and BDO LLP provides comprehensive and up to date legal information covering:

  • Creditors' decision procedures in administration—the position under the Insolvency (England and Wales) Rules 2016
  • Administration
  • Duty to seek a decision from creditors
  • Consideration of administrator’s proposals by creditors
  • Notice of decision procedure or of seeking deemed consent
  • Dispensing with the creditors’ decision
  • Venue for a physical meeting
  • Chairman of a meeting
  • Decision date
  • Voting entitlement
  • more

The Insolvency (England and Wales) Rules 2016, SI 2016/1024 (IR 2016) provide a revised scheme for decision-making in all insolvency procedures. The detailed provisions for decision-making are set out in Part 15 of the IR 2016, SI 2016/1024. For details of changes in this area, see Practice Notes: The Insolvency (England and Wales) Rules 2016—Part 3: Administration and The Insolvency (England and Wales) Rules 2016—Part 15 and 16: Creditors meetings and proxies [Archived].

Administration

The purpose of an administration is to rescue a company primarily, but not exclusively, as a going concern. The administrator is subject to a set of objectives which they are bound by statute to seek to achieve. Overall however, they must act expeditiously and efficiently in the interests of the creditors as a whole to achieve one or more of the objectives set out by statute, without undue expense or unnecessary application to court.

Duty to seek a decision from creditors

An administrator is under a duty to seek a decision from the company’s creditors if requested to do so by the creditors whose debts amount to at least 10% of the company’s total debts, or if ordered to do so by the court. If they fail to do so, they commit a criminal offence.

Consideration of administrator’s proposals by creditors

An administrator is

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