The European Commission has approved insolvency changes across Europe which includes US style Chapter 11 proceedings.
The proposals include a US style regime which offers struggling companies’ time, from three months up to 12, to put a restructuring plan in place before their creditors can take any action.
In addition the proposed changes suggest that bankrupts should not be discharged until a minimum of 3 years has passed, in the UK at the moment a bankrupt is usually discharged in 12 months.
R3, the insolvency trade body, have said that although in principle the proposals sound like they could work, they are not wholly happy as there is much scope for abuse of the system. R3 would like to see evidence of how the proposals benefit creditors.
We suspect that the devil will be in the detail – watch this space!
It is important for anybody facing financial difficulties, whether personally, directors of limited companies or partnerships, to seek advice from a licensed insolvency practitioner as soon as possible.
To take advantage of our free consultation, please telephone Stella Flemmings on 01377 257788, 01724 230060 or 01904 520116 and she will make you an appointment with one of our insolvency professionals at our Driffield, Scunthorpe or York offices.
Redman Nichols Butler has had a York office for nearly six years now and specialises in advising SME businesses in York and North Yorkshire. The Redman Nichols Butler York office address is Westminster Business Centre, Nether Poppleton, York, YO26 6RB.
Redman Nichols Butler has had a Driffield office for 16 years now and specialises in advising SME businesses in East Yorkshire. The Redman Nichols Butler Driffield office address is Maclaren House, Skerne Road, Driffield, East Yorkshire, YO25 6PN.
Redman Nichols Butler has had a Scunthorpe office for nearly 4 years now and specialises in advising SME businesses in Scunthorpe, Grimsby and all over North East Lincolnshire. The Redman Nichols Butler Scunthorpe office address is Suite 8b, Normanby Gateway, Lysaghts Way, Scunthorpe, DN15 9YG.