It is likely that changes to the employer debt regulations (the so-called "section 75 debt" regime) will come into force on 6 April. These will prevent a debt from arising on certain internal group restructurings where there is no weakening of the employer covenant. However, the regulations are highly prescriptive and are, therefore, less attractive as a means of dealing with section 75 debts when compared to apportionment or withdrawal arrangements.
The SFO has announced that managing director and shareholder of Alta Gas Plc, Peter Brian Bradley, has been ordered to pay £1 million compensation to victims following confiscation proceedings on 26 January 2010. In 2001, Alta Gas Plc went into administrative receivership which resulted in the receivers of the company discovering a sophisticated system of false accounts that enhanced the profitability of the company.
In September 2009 we reported on the first instance decision in Butters and ors v BBC Worldwide Ltd and ors, accessible here in which the Court held that contractual provisions in a joint venture agreement taken together with termination provisions in a licence of IP rights were void since the effect of those provisions on insolvency was to deprive creditors' access to assets and therefore contrary
The High Court has ruled in the case of Goldacre (Offices) Limited v Nortel Networks UK Limited (in administration) [2009] that rent for premises that continue to be used for the beneficial outcome of an administration must be paid as an expense of the administration. This decision confirms that the court has no discretion in these circumstances and that it does not matter if only part of the premises are being used. This contrasts with the position where a landlord wishes to take action against a tenant in administration such as bringing forfeiture or injunction proceedings.
On 1 May 2009, the administrators of Lehman Brothers International (Europe) ("LBIE") applied to the English High Court for directions on certain issues relating to "Client Money" (as defined in the UK Financial Services Authority's Client Assets Rules, the "CASS Rules") held by LBIE. LBIE was regulated by the FSA and was required to comply with the CASS Rules.
In August we reported that the Court of Appeal had expressed doubts as to whether the EAT in Oakland v Wellswood was right to suggest that pre-pack administrations could be insolvencies "begun with a view to liquidation" (so that TUPE does not apply to transfer employees).
In August we reported that the Court of Appeal had expressed doubts as to whether the EAT in Oakland v Wellswood was right to suggest that pre-pack administrations could be insolvencies "begun with a view to liquidation" (so that TUPE does not apply to transfer employees).
On 17 September the DWP published a consultation paper (attaching draft regulations) in which it proposes that certain corporate restructurings will not trigger an employer debt under section 75 of the Pensions Act 1995. Following on from amendments introduced by regulations in 2008, the draft regulations also make some technical amendments to the employer debt regime, which are intended to ease its operation in practice.
Section 75: a reminder
Background
Article 4.1 of Council Regulation (EU) No 1346/2000 of 29 May 2000 on Insolvency Proceedings (the "Regulation") states: "Save as otherwise provided in this Regulation, the law applicable to insolvency proceedings and their effects shall be that of the Member State within the territory of which such proceedings are opened..."
Article 4.2 of the Regulation sets out a non-exhaustive list of the matters which the law of the state of the opening of insolvency proceedings is to determine, including:
Background
Article 4.1 of Council Regulation (EU) No 1346/2000 of 29 May 2000 on Insolvency Proceedings (the "Regulation") states: "Save as otherwise provided in this Regulation, the law applicable to insolvency proceedings and their effects shall be that of the Member State within the territory of which such proceedings are opened..."
Article 4.2 of the Regulation sets out a non-exhaustive list of the matters which the law of the state of the opening of insolvency proceedings is to determine, including: