Q&As

What happens if the requisite threshold of creditors request a physical meeting during the COVID-19 crisis?

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Produced in partnership with Helen Kavanagh
Published on LexisPSL on 27/03/2020

The following Restructuring & Insolvency Q&A produced in partnership with Helen Kavanagh provides comprehensive and up to date legal information covering:

  • What happens if the requisite threshold of creditors request a physical meeting during the COVID-19 crisis?
  • The rules on creditors’ meetings
  • Coronavirus (Covid-19) and social distancing
  • Virtual meetings

What happens if the requisite threshold of creditors request a physical meeting during the COVID-19 crisis?

This advice is current as at 26 March 2020 but may be updated as more guidance becomes available.

The rules on creditors’ meetings

The Insolvency (England and Wales) Rules 2016 (IR 2016), SI 2016/1024 provide a revised scheme for decision making in insolvency proceedings from 6 April 2017.

Previously, decisions were to be made at meetings. The IR 2016, SI 2016/1024 seek to limit the number of physical meetings held and now make clear that where a decision is to be made by either a qualifying decision procedure, a creditors’ decision procedure or a deemed consent procedure, the rules set out in IR 2016, SI 2016/1024, Pt 15 apply.

Physical meetings have not been abolished entirely; however, they now only occur on written request by the relevant proportion of creditors or contributories (see IR 2016, SI 2016/1024, r 15.6). The relevant proportion is set out in sections 246ZE and 379ZA of the Insolvency Act 1986.

The ‘minimum number’ of creditors or contributories is any of the following—(a) 10% in value of the creditors or contributories; (b) 10% in number of the creditors or contributories; (c) 10 creditors or contributories.

For further infomration, see Practice Note: The deemed consent procedure, decision-making procedure, and meetings—the position under the Insolvency (England and Wales) Rules 2016.

Coronavirus (Covid-19) and social

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