Insolvency Reform - Enterprise Act mini-series - second instalment

The corporate insolvency provisions of the Enterprise Act 2002 come into force today. They rewrite the rule book on exiting from administrations.

• The Insolvency Act 1986 is virtually silent on exit routes, even though administration has always been seen as a transitional regime, given the inability of administrators to make distributions to creditors.
• The Enterprise Act prescribes no less than 9 exit routes, but still leaves many unanswered questions.
• It introduces the concept of a new streamlined creditors' voluntary liquidation process but does not make it clear when the administrator should use this process, rather than the new powers given to him to make distributions to unsecured creditors.

To help you understand the different aspects of the reforms and how they will affect you in practice we will be issuing a mini-series of articles throughout September and October.

To access our previous article and this week's article - Exiting administration and the role of liquidation after the Enterprise Act, please click here.