Insolvency EC regulations or Insolvency Act 1986 & Rules ?

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Dear Insolvency Service,

The insolvency Service has refused to give a straight answer to the following question.

UK Insolvency/ Bankruptcy EC Regulation Article 3 - Article 3(1) (2) (3) (4) Main, Secondary, Territorial Proceedings

Please clarify which part of the EC regulations above applies to the main, secondary and territorial proceedings insolvency forms used within the UK.

UK insolvency forms and orders are only stating Article 3 but not which part of Article 3 applies (1) (2) (3) or (4).

Insolvency EC regulations or Insolvency Act 1986 & Rules ?

Please can you confirm if Insolvency proceeding are beging carried out under EC regulations and not Insolvency Act 1986 and Insolvency Rules.

And if TWO bankruptcy filings are being carried out simultaneously that the debtor is not being made aware of?

Please define the definition of main proceedings and how this applies to the people living in the UK, and also the same process for secondary, and territorial proceedings.

Yours faithfully,

J. Ross

FOI, Insolvency Service

Dear Mr J Ross   

 

RE: FREEDOM OF INFORMATION ACT 2000 - REQUEST FOR INFORMATION Our Ref:
2665

 

I write in reply to your e-mail received 23/06/17 reproduced below

 

Our reference for the request is 2665.

 

Your request is being processed and you may expect a reply within 20
working days, which will be 21/07/17.  In some circumstances we may not be
able to achieve this timescale, but if this is likely to be the case you
will be informed at the earliest opportunity and given a revised
timescale.

 

Yours sincerely

 

Mrs Webb

 

Dear Insolvency Service,

 

The insolvency Service has refused to give a straight answer to the
following question.

 

UK Insolvency/ Bankruptcy EC Regulation Article 3 - Article 3(1) (2) (3)
(4) Main, Secondary, Territorial Proceedings

 

Please clarify which part of the EC regulations above applies to the main,
secondary and territorial proceedings insolvency forms used within the UK.

 

UK insolvency forms and orders are only stating Article 3 but not which
part of Article 3 applies (1) (2) (3) or (4).

 

Insolvency EC regulations or Insolvency Act 1986 & Rules ?

 

Please can you confirm  if Insolvency proceeding are beging carried out
under EC regulations and not Insolvency Act 1986 and Insolvency Rules.

 

And if TWO bankruptcy filings are being carried out simultaneously that
the debtor is not being made aware of?

 

Please define the definition of main proceedings and how this applies to
the people living in the UK, and also the same process for secondary, and
territorial proceedings. 

 

Yours faithfully,

 

J. Ross

 

 

 

Emma Webb | Data Protection and Freedom of Information Officer | The
Insolvency Service – Delivering economic confidence

EXTERNAL RELATIONS, 4th Floor, 4 Abbey Orchard Street, London, SW1P 2HT
| DX 120875 Victoria 18 | [1][email address] | T. +44
(0) 20 7637 6404            M. +44 (0) 7733 003109 |
[2]www.gov.uk/insolvency-service

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Policy.Unit, Insolvency Service

Dear Sir or Madam

 

Thank you for your recent query regarding UK insolvency law and the EC
Regulation.

 

Without knowing the basis of your questions and the context in which you
asked them, it has been somewhat difficult to address each point you raise
but I have set out below some information which I hope you will find
helpful. If you need advice on a specific issue affecting you, I would
strongly recommend you seek independent legal advice as the Insolvency
Service cannot provide this.

 

The EU Insolvency Regulation provides a framework for jurisdiction,
cooperation, recognition and enforcement in cross-border insolvency
proceedings within the EU. It is worth noting that the current Regulation
has only just come into force (on 26th June 2017) and supersedes what was
commonly known as the ‘EC Regulation’, although there are many
similarities between the two instruments.

 

In the UK, national law (including the Insolvency Act 1986 and Insolvency
(England and Wales) Rules 2016) provides the majority of the legal
framework for the conduct of insolvency proceedings, but this is subject
to the provisions of the EU Insolvency Regulation which provides specific
rules relating to jurisdiction, cooperation, recognition and enforcement
in cross-border EU proceedings. The EU Insolvency Regulation does not
apply if there is no cross-border EU element to a case.

 

National law provides the procedural mechanism for establishing whether or
not the EU Insolvency Regulation applies to a particular case by requiring
an examination as to the jurisdiction of the debtor concerned. For
example, the Insolvency (E&W) Rules 2016 prescribes the information the
court must record when making a bankruptcy order against a person. This
includes a determination as to whether the bankruptcy proceedings will be
main, secondary, territorial or non-EU proceedings. These descriptions
are, in effect, another way of stating under which ground of Article 3
applies.

 

Where UK insolvency proceedings are EU proceedings, they will take the
form of main proceedings where the debtor’s centre of main interests is
located. The EU Insolvency Regulations states, ‘the centre of main
interests shall be the place where the debtor conducts the administration
of its interests on a regular basis and which is ascertainable by third
parties.’ Determining a debtor’s centre of main interests is therefore a
fact-based test which considers debtors’ individual circumstances.

 

If a debtor’s centre of main interests is located in another EU member
state, but the debtor has an establishment in the UK (‘establishment’ is
defined in Article 2(10) as, ‘any place of operations where a debtor
carries out or has carried out in the 3-month period prior to the request
to open main insolvency proceedings a non-transitory economic activity
with human means and assets’), then UK proceedings may only take the form
of territorial proceedings (if main proceedings have not been opened) or
secondary proceedings (if they have). In such cases, only the debtor’s
assets located in the UK would be subject to the UK proceedings.

 

It is therefore possible for a debtor to be subject to insolvency
proceedings in several member states at the same time. National law sets
out the conditions for the opening of insolvency proceedings, including
requirements relating to what notice should be given to the debtor, both
pre-insolvency and once the insolvency proceedings have commenced.

 

One final point I would like to draw your attention to is the removal of
statutory forms previously contained in the Insolvency Rules 1986. The
Insolvency (E&W) Rules 2016 do not provide for statutory forms. Instead,
they contain prescribed content which users must provide in documents.

 

I hope this reply is helpful to you.

 

 

Regards

 

 

M Charles

Policy Unit

The Insolvency Service

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recipient then you have received this e-mail in error and any use,
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Dear Policy.Unit,

Thank you for attempting to explain an extremely difficult subject and for noting that the prescribed insolvency forms have only recently been abolished and therefor must be used up until that point.

Please be so kind as to answer in good faith, whether or not national law applies or EC formerly EU private international law when there is no cross-border Insolvency proceedings with the EU within a case.

In other words if a debtor lives in England or Wales, as clearly it is impossible to reside in both, and who is not domiciled nor resides and carries out no business in a EU member state. Please clarify if any court order should be marked up non-EU proceedings where the above is the case and there is no cross-border element.

Or are you saying that England and Wales as a joint collective, is one EU member state.

Please also provide a definition in layman terms of ' the centre of main interests shall be the place where the debtor conducts the administration of its interests on a regular basis and which is ascertainable by third parties' are you referring to a business.

Please also provide the definition of 'establishment' are you also referring to a business.

Yours sincerely,

J. Ross

J. Ross left an annotation ()

Insolvency Service

Quote: 'The EU Regulation does not apply if there in no cross-border EU element to a case.'

Policy.Unit, Insolvency Service

Dear Sir or Madam

 

Thank you for your further query relating to cross-border insolvency. I
have attempted to address below the questions you asked in your email.

 

Where there is no cross-border EU element to insolvency proceedings in
England and Wales, the provisions of the EU Insolvency Regulation
(2015/848) do not apply. In the scenario you outline, where the court
makes a bankruptcy order against an individual, the bankruptcy order must
contain, 'the order that the court is satisfied that the EU Regulation
does not apply in relation to the proceedings' (R.10.31 Insolvency
(England and Wales) Rules 2016).

 

With regards to your comments about England and/or Wales, I think there
may be some confusion. My references to England AND Wales reflect the fact
that the law of England and Wales is the same (i.e. the same law applies
in both parts of the UK). Different law applies in Scotland and Northern
Ireland.

 

I am not able to provide a definition of 'centre of main interests' other
than the wording contained in Article 3 of the EU Insolvency Regulation.
Providing an interpretation could lead to confusion as any interpretation
may be misunderstood or may not correspond with that of the courts, whose
role it is to interpret legislation. You are free to seek legal advice if
you want an interpretation of the term. The same applies in respect of
'establishment'.

 

The explanation of 'centre of main interests' contained in Article 3
extends to debtors who are both individuals (including an individual
running a non-incorporated business) and corporate entities (for example,
companies). The definition of 'establishment' also applies to debtors who
are both individuals and corporate entities.

 

In case it is of use to you, I have provided a link to the text of the EU
Insolvency Regulation:
[1]http://eur-lex.europa.eu/legal-content/E...

 

I hope this reply is helpful to you.

 

regards

Policy Unit

 

 

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