On 30 October 2023, the UK government published an update on its legislative approach for regulating fiat-backed stablecoins, following on from its consultation on the UK regulatory approach to cryptoassets and stablecoins in January 2021, and the response to that consultation in April 2022. Alongside this, it published a response to its consultation on the approach to managing the failure of systemic digital settlement asset (DSA) (including stablecoin) firms.

This case relates to the principle that creditors with the benefit of a third-party debt order, are ostensibly in a better position than other unsecured creditors of an insolvent estate.

Darty Holdings SAS v Carton-Kelly(as additional liquidator of CGL Realisations Limited) [2023] EWCA Civ 1135

Overview

On 26 September 2023, our Insolvency and Asset Recovery team hosted a seminar explaining the emerging and developing types of disputes focussed on insolvent estate recoveries.

The Insolvency Service released the quarterly insolvency statistics for July - September 2023 on 31 October, painting a picture of growing corporate distress. This period saw a total of 6,208 company insolvencies, which together with Q2 2023 marks the highest number of quarterly insolvencies since the midst of the financial crisis in 2009.

Although a comparison with Q2 figures shows a slight reduction of 2% in overall insolvencies, the figures for Q3 showed a marked rise in both compulsory liquidations (14% up on Q2) and administrations (11% higher than Q2).

In a judgment that will be welcomed by insolvency professionals, the Supreme Court has today confirmed that administrators cannot be personally criminally liable for failing to notify the Secretary of State about plans for collective redundancies. This judgment follows an appeal by Robert Palmer against a finding that he was criminally liable for his failure to submit form HR1 in his capacity as the joint administrator of West Coast Capital (USC) Limited (USC).

What is the obligation?

The recent news on the BBC about the rise in insolvencies makes for tough reading. But those who are in business already know how difficult it is out there as they try to weather the trading conditions. Inflationary pressures are increasing the costs of providing goods and services to customers, eroding profitability.

Amendments to the director disqualification regime, enacted in 2015, enable the Insolvency Service (on the request of a creditor of an insolvent company) to seek a compensatory remedy against a disqualified director for the benefit of the creditor(s). This empowers a creditor to take action where an insolvency officer may be unable, or unwilling, to do so.

The Financial Conduct Authority (“the FCA”) issued a Final Notice against London Capital & Finance plc (“LCF”) for contravening regulatory requirements (pursuant to section 205 of the Financial Services and Markets Act 2000 (“the Act”)). The Final Notice contained a statement censuring LCF for failing to ensure that its financial promotions were fair, clear and not misleading.

With the passing of the Moveable Transactions (Scotland) Act (MTSA) (likely to pass into law in 2024) the way in which we take security over rights and assets in Scotland will be brought firmly into the 21st century, doing away with the need to rely on statutes from as long ago as 1862 and a smattering of case law which has fostered uncertainty in the market for almost as long.