Moratorium

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The Corporate Insolvency and Governance Act 2020 (CIGA 2020) inserted a new Part A1 into the Insolvency Act 1986 (IA 1986) which provides for a new insolvency process whereby directors of insolvent companies, or companies that are likely to become unable to pay their debts (ie insolvent) can obtain a moratorium. This period lasts for an initial period of 20 business days, which can be extended. It is designed to allow viable businesses time to restructure or seek new investment free from creditor action. The moratorium is overseen by an insolvency practitioner acting as a ‘monitor’, although the directors will remain in charge of running the business on a day-to-day basis (known as a ‘debtor-in-possession’ process with the company being the ‘debtor’) subject to certain constraints. The intention is to provide a streamlined procedure that keeps administrative burdens to a minimum, makes the process as quick as possible and does not add disproportionate costs on to struggling businesses.

The moratorium is free-standing—it is not be a gateway or tied to a particular insolvency or restructuring process.

Who is eligible to apply?

The company needs to meet

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Latest Restructuring & Insolvency News

Restructuring & Insolvency weekly highlights—23 October 2025

This week's edition of Restructuring & Insolvency weekly highlights includes: analysis of the court’s decision confirming that liquidators cannot limit their liability in their engagement terms (Pagden v Fry), the court’s judgment on an application by trustees in bankruptcy seeking annulment of a bankruptcy order, as they could not recover the bankruptcy estate located in Austria because Austrian courts refused to recognise the bankruptcy order (Nilsson (as joint trustees in bankruptcy of Timothy Edward Jones) v Jones), plus a round-up of other news and cases for restructuring and insolvency professionals.

Insolvency Service announces seven-year director disqualifications for insolvency avoidance scheme enablers

The Insolvency Service has announced that the Secretary of State for Business and Trade has accepted seven-year disqualification undertakings from sisters Karen Mortimer and Joanna Seawright, effective from the 21 October 2025. The disqualifications relate to their role in enabling the Atherton corporate rescue scheme designed to subvert insolvency legislation. Mortimer and Seawright became directors of 138 companies with combined debts exceeding £67m and assets totalling over £42m without independently verifying financial positions or investigating asset disposals. The companies were presented as insolvent with no assets, but no assets were transferred to GPA KLM Ltd and Summers & May Ltd, the entities controlled by the sisters. The undertakings prohibit the sisters from any involvement in company promotion, formation or management without the court’s permission.

Insolvency Service reports director imprisonment for BBL misrepresentation

The Insolvency Service has reported that Craig Smith, director of C.A.S. Property Maintenance (Midlands) Limited, has bee sentenced to two years and one month in prison at Wolverhampton Crown Court for fraud by false representation. Smith fraudulently obtained a £50,000 Covid bounce back loan (BBL) in August 2020 by claiming his annual turnover was £200,000 when it was £33,578. The 42-year-old from Dudley had pleaded guilty to one count of fraud by false representation at Wolverhampton Crown Court on 14 August 2025. Smith resigned as director in July 2021 without filing accounts for the company, which was dissolved in 2022.

HMT confirms transfer of AML supervision from professional bodies to FCA

HM Treasury (HMT) has confirmed that anti‑money laundering (AML) and counter‑terrorism financing (CTF) supervisory responsibilities will be transferred. Instead of a framework where 22 professional body supervisors cover these duties, supervision will be consolidated under the Financial Conduct Authority (FCA). The FCA will serve as the Single Professional Services Supervisor (SPSS). The FCA will take over oversight of approximately 60,000 regulated firms – including legal, accountancy, and trust and company service providers – which is a significant increase from its present responsibility for 17,000 entities. To enable this change, new primary legislation must be introduced to grant the FCA the required powers, with timelines dependent on parliamentary scheduling. The FCA plans to work closely with stakeholders in developing a detailed delivery plan, and a public consultation is expected to launch in November 2025.

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