The Pension Schemes Act 2021 (‘the Act’) has received Royal Assent, with the UK government indicating that key provisions will come into force by autumn 2021.
The Act includes a number of provisions that will significantly impact restructuring activity involving financially distressed groups with a UK defined-benefit (DB) pension scheme.
What will change under the Act?
Below are some of the most significant changes being introduced by the Act.
In the recent decision of Bresco Electrical Services Limited (in liquidation) v Michael J Lonsdale (Electrical) Limited, the Supreme Court has overturned the Court of Appeal in upholding the practicality of adjudication by insolvent companies.
In an important new English Court of Appeal judgment in LBI EHF v Raiffeisen Bank International AG [2018] EWCA Civ 719 (11 April 2018), Lord Justice Flaux approved and expanded the earlier High Court judgment of Mr Justice Knowles CBE in LBI EHF (in winding up) v Raiffeisen Zentralbank Osterreich [2017] EWHC 522 (Comm) (20 March 2017) on the correct meaning and treatment of t
On 6 June 2013, the Court of Appeal reversed the High Court’s decision in The Trustees of the Olympic Airlines SA Pension & Life Insurance Scheme v Olympic Airlines SA from May 2012.
A prominent aspect of the most recent wave of restructuring is the significant role often played by defined-benefited (DB) pension liabilities.
The Pensions Regulator (the Regulator) recently used its powers under the Pensions Act 1995 to appoint an independent trustee to the exclusion of all other trustees of the scheme. The employer was required to pay the fees and expenses relating to the appointment.
The Regulator decided to use its powers because:
On 25 January 2022, the Financial Conduct Authority (FCA) published draft guidance on how it will approach ‘compromises’ by regulated firms. The guidance is expressed to cover restructuring plans, schemes of arrangement and CVAs.
The financial loss and the uncertainty caused by the pandemic continues to affect business globally, and an increase in corporate insolvency is widely anticipated. Arbitration is an effective dispute resolution mechanism, but a counterparty entering insolvency proceedings can be disruptive. We recently wrote about insolvency being one of the key trends in international arbitration in 2021.
In any economic downturn, there is usually an increase in the number of demands made throughout supply chains and in particular by owners / employers on project securities (e.g. for performance issues, upon termination or following insolvency) and the recent global economic slowdown caused by the coronavirus pandemic is no different.
The new Corporate Insolvency and Governance Bill (the Bill) has been introduced into the UK Parliament and proposes significant changes to insolvency law, including: