AiB seeking views on further insolvency rules changes

Rule changes affecting both corporate and personal insolvencies in Scotland are in preparation at the Accountant in Bankruptcy (AiB), which is now undertaking an informal consultation process in the changes proposed.

In corporate insolvency, its work, with the Scottish and UK Governments and the Insolvency Service (IS) south of the border, follows modernised Insolvency Rules for England & Wales, which were laid in the UK Parliament on 25 October 2016 and come into force in April 2017.

In Scotland, AiB and IS are keen to ensure that stakeholders have sufficient time to familiarise themselves with the structure and content of the new rules before they come into force. Consequently, it is anticipated that the rules will not commence before October 2017.

Further legislative amendments in England & Wales led to the Scottish ministers making the Public Services Reform (Insolvency) (Scotland) Order 2016, to bring the position for devolved areas of corporate insolvency in Scotland in to line with these changes in England and Wales,

This work led to AiB identifying the need and opportunity to make further changes to the Insolvency Act 1986 that will assist in the process of rules modernisation. A further Public Services Reform Order has been identified as the most appropriate legislative vehicle for these changes.

For personal insolvency, this new order offers the opportunity to make changes to personal insolvency legislation in Scotland in relation to essential supplies, in line with those already introduced in England & Wales through the Insolvency (Protection of Essential Supplies) Order 2015, bringing the rules into line with modern day developments in commercial practice and introducing certain restrictions on essential suppliers exercising insolvency related clauses in their contracts, subject to safeguards for those suppliers.

AiB is now inviting feedback from stakeholders on the further PSRO. Click here for further information. Responses are requested by 28 November 2016.