The following Restructuring & Insolvency guidance note provides comprehensive and up to date legal information covering:
A company voluntary arrangement (CVA) is an arrangement between a company and its creditors, supervised by an IP (who is known as the supervisor once the arrangement become effective), sanctioned by the court and in compromise for the company's debts. For further reading on CVAs, the steps to implement them and their effect, see: Company Voluntary Arrangements—overview and the Practice Notes: In what circumstances can a CVA be proposed and by whom? and The process and effect of approval of a company voluntary arrangement (CVA): the position under the Insolvency (England and Wales) Rules 2016.
A CVA is normally proposed by the company's directors (but can be proposed by its administrator or liquidator) and its aim is to make a compromise in satisfaction of its debts, or have a scheme of arrangement of its affairs.
The use of CVAs for companies with large property portfolios has increased in recent times as a CVA offers a mechanism that allows the tenant company (with creditor consent) to restructure its rent obligations on a mass scale, without the need to negotiate with each individual landlord. Such a CVA can significantly reduce the rent overheads of a company in a very time and cost-effective manner. Recent CVAs which have been aimed at reducing
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