Q&As

What if repayment terms under a company voluntary arrangement or individual voluntary arrangement are breached as a result of the coronavirus (COVID-19) crisis?

read titleRead full title
Produced in partnership with Alison Curry of Insolvency Support Services
Published on LexisPSL on 06/04/2020

The following Restructuring & Insolvency Q&A produced in partnership with Alison Curry of Insolvency Support Services provides comprehensive and up to date legal information covering:

  • What if repayment terms under a company voluntary arrangement or individual voluntary arrangement are breached as a result of the coronavirus (COVID-19) crisis?
  • Straightforward consumer IVA protocol
  • R3 standard conditions
  • Variation
  • Regulatory expectations
  • HMRC’s approach

What if repayment terms under a company voluntary arrangement or individual voluntary arrangement are breached as a result of the coronavirus (COVID-19) crisis?

The obligations of a supervisor in connection with a breach of the terms of a voluntary arrangement will be set out within the proposal document and any standards conditions of application to it. A supervisor has only such the discretion as to what action to take in event of breach as is afforded by the terms to the voluntary arrangement they are supervising.

In connection with an individual voluntary arrangements (IVAs), there are two-widely used sets of standard conditions, those published by R3 and those that relate to IVAs conducted under the straightforward consumer IVA protocol. For company voluntary arrangements (CVAs) there are no standards conditions officially published, by commonly, practitioners will use a variant of the R3 conditions, appropriately amended to cater for a corporate matter.

These standard conditions confer slightly differing obligations and discretions on the supervisor (considered below), but in both cases, they state that the terms of the proposal itself take priority, so reference must always be made to the proposal document itself for any case-specific terms.

Straightforward consumer IVA protocol

The straightforward consumer IVA protocol is utilised in the majority of IVA cases (understood to be around 80%). In cases using these terms (to the extent that they have not been

Popular documents