Restructuring and insolvency—Isle of Man—Q&A guide

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

  • Restructuring and insolvency—Isle of Man—Q&A guide
  • 1. What main legislation is applicable to insolvencies and reorganisations?
  • 2. What entities are excluded from customary insolvency or reorganisation proceedings and what legislation applies to them? What assets are excluded or exempt from claims of creditors?
  • 3. What procedures are followed in the insolvency of a government-owned enterprise? What remedies do creditors of insolvent public enterprises have?
  • 4. Has your country enacted legislation to deal with the financial difficulties of institutions that are considered ‘too big to fail’?
  • 5. What courts are involved? What are the rights of appeal from court orders? Does an appellant have an automatic right of appeal or must it obtain permission? Is there a requirement to post security to proceed with an appeal?
  • 6. What are the requirements for a debtor commencing a voluntary liquidation case and what are the effects?
  • 7. What are the requirements for a debtor commencing a voluntary reorganisation and what are the effects?
  • 8. How are creditors classified for purposes of a reorganisation plan and how is the plan approved? Can a reorganisation plan release non-debtor parties from liability and, if so, in what circumstances?
  • 9. What are the requirements for creditors placing a debtor into involuntary liquidation and what are the effects? Once the proceeding is opened, are there material differences to proceedings opened voluntarily?
  • More...

Restructuring and insolvency—Isle of Man—Q&A guide

This Practice Note contains a jurisdiction-specific Q&A guide to restructuring and insolvency in Isle of Man published as part of the Lexology Getting the Deal Through series by Law Business Research (published: June 2021).

Authors: DQ Advocates Ltd—Andrew Harding; Tara Cubbon

1. What main legislation is applicable to insolvencies and reorganisations?

The legislation applicable to insolvencies and reorganisations is set out in the Companies Act 1931 (the '31 Act), The Companies (Winding Up) Rules 1934 (the Rules) and the Companies Act 2006 (the 2006 Act).

Companies in the Isle of Man can either be incorporated under the '31 Act ('31 companies) or the 2006 Act (2006 companies) and each of the two types of company have different characteristics and statutory powers as governed by and set out in the respective Companies Act.

The '31 Act sets out the statutory insolvency regime for the Isle of Man in conjunction with the Rules.

The '31 Act insolvency regime (ie, sections 155 to 272 (inclusive) and 277 to 280 (inclusive)) is applied to companies incorporated under the 2006 Act by section 182 of the 2006 Act.

One of the circumstances in which a company may be wound up by court as set out in section 162(5) of the '31 Act is if the company is unable to pay its debts.

Section 163(1) sets out the definition of inability to pay

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