How can an administrator apply to extend the period of automatic termination of administration?
How can an administrator apply to extend the period of automatic termination of administration?

The following Restructuring & Insolvency guidance note provides comprehensive and up to date legal information covering:

  • How can an administrator apply to extend the period of automatic termination of administration?
  • Brexit impact
  • How and when can an administrator apply to extend their term?
  • Procedure for extending an administrator’s term by court order
  • How to extend an administrator’s term by creditors’ consent
  • When will the court grant an extension?

The Enterprise Act 2002 enabled administrators to be appointed using an out-of-court procedure for the first time. While this allowed for more freedom within the administration process, parliament recognised that it would not be wise to allow administrations to continue indefinitely with no recourse to the court. As a result, under the Insolvency Act 1986 (IA 1986), the period of an administration, or 'administration term' or 'administrator's term of office', will, unless extended, automatically come to an end after 12 months. See Administration—overview.

Brexit impact

This Practice Note is impacted by the decision of the UK on 23 June 2016 to leave the European Union. For further details of the impact on the Recast Regulation on Insolvency, see Practice Note: Brexit—impact on Recast Regulation on Insolvency. In particular, for the impact on administrations, see Practice Note: Brexit—impact on administration.

The issue of Brexit was raised in the context of administration extensions in the case of Re Nortel Networks UK Limited. The administrators of Nortel Networks UK Limited had applied to court for a further extension of the administration to 13 January 2019. Snowden J noted the uncertainty over Brexit and whether, and if so how, the Recast Regulation on Insolvency, Regulation (EU) 848/2015 (Recast Regulation) or EC Regulation on Insolvency, Regulation (EC) 1346/2000 would apply after the UK leaves the EU.