Factors the court will take into account when deciding whether to lift or impose a liquidation stay
Produced in partnership with Kate Rogers of Radcliffe Chambers
Factors the court will take into account when deciding whether to lift or impose a liquidation stay

The following Restructuring & Insolvency guidance note Produced in partnership with Kate Rogers of Radcliffe Chambers provides comprehensive and up to date legal information covering:

  • Factors the court will take into account when deciding whether to lift or impose a liquidation stay
  • Brexit impact—cross-border insolvency (Insolvency (Amendment) (EU Exit) Regulations 2019, SI 2019/146)
  • What is a liquidation stay and what is its effect?
  • When the liquidation stay applies and its effect
  • Factors the court will apply when either lifting the liquidation stay or imposing it
  • How to make an application to lift the liquidation stay

Brexit impact—cross-border insolvency (Insolvency (Amendment) (EU Exit) Regulations 2019, SI 2019/146)

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 to EU law. References to exit day in many Brexit SIs are to be read as reference to IP completion day (Implementation Period completion day, defined in clause 39 as 31 December 2020 at 11.00 pm) (unless that provision is expressly disapplied by the SI in question). For further details, see News Analysis: Brexit—impact of the Withdrawal Agreement and European Union (Withdrawal Agreement) Act 2020 for R&I lawyers and Brexit Bulletin—key updates, research tips and resources.

For cross-border insolvency, the Insolvency (Amendment) (EU Exit) Regulations 2019, SI 2019/146 have an impact. For further details, see Practice Note: Brexit—impact on Recast Regulation on Insolvency.

What is a liquidation stay and what is its effect?

A liquidation stay (when in force) has similar effects to a moratorium/interim moratorium in an administration under paragraphs 43 and 44 of Schedule B1 to the Insolvency Act 1986 (IA 1986). For further reading in respect of the moratorium in an administration, see Practice Note: The moratorium in administration.

A liquidation stay means that no action or proceedings can