Insolvency Rules Review 2026 consultation launched

The UK government has opened a consultation on the Insolvency Rules, seeking views on whether the current framework remains clear, proportionate and fit for modern practice. The consultation raises important questions about procedure, creditor engagement, remuneration, digital processes and the scope of future reform.

The consultation forms part of the UK government’s second post-implementation review of the Insolvency (England and Wales) Rules 2016 (the England and Wales Rules) and the first post-implementation review of the Insolvency (Scotland) (Company Voluntary Arrangements and Administration) Rules 2018. 

Its scope is evolutionary rather than revolutionary: it looks at how the Rules operate in practice, where they may create unnecessary cost or uncertainty, and whether they remain suitable for modern insolvency work. The consultation doesn’t reopen the wider policy framework of the Insolvency Act 1986.

Why the Scottish scope is limited

The Scottish element of the review focuses on the Insolvency (Scotland) (Company Voluntary Arrangements and Administration) Rules 2018. Those Rules cover CVAs and administrations in Scotland, which fall within reserved policy areas for the UK government.

The consultation says that, where the findings are relevant to areas that are devolved or shared with Scotland, they should be shared with Scottish lawmakers. This will be important if the review identifies process issues that affect both UK and Scottish frameworks, or if changes to reserved rules have knock-on effects for Scottish insolvency processes. It also notes that recent changes to the England and Wales Rules will need to be taken into account in any future Scottish legislative amendments.

It’s important that insolvency processes remain closely aligned across the UK where possible. Scotland has its own legal system and court structure, so the rules cannot and should not be identical in every area. However, unnecessary differences between jurisdictions can add cost, uncertainty and complexity for firms, creditors and others working across the UK. 

Any future changes should keep processes closely aligned where this helps improve efficiency, makes things clearer for creditors and supports consistent outcomes.

Why the consultation matters

The consultation doesn’t reopen the policy structure of the Insolvency Act 1986 or make immediate procedural changes. It asks whether the Rules still deliver their intended outcomes proportionately. 
Some issues may need primary legislation, but other practical improvements could be made through secondary legislation, forms, guidance or process changes if the evidence supports reform.

Reducing administrative burden

The consultation asks whether office-holders are still required to carry out steps that no longer provide enough value. It highlights a number of specific areas where the government is looking for views.

Uncontested court applications

The consultation questions whether all court applications still need judicial involvement. Court oversight remains essential where rights are disputed, directions are needed or significant issues arise. Routine and uncontested applications can add delay, cost and uncertainty.

It therefore looks at whether there are other ways to handle mainly procedural applications. The aim would be to keep the right safeguards in place, while reducing unnecessary cost and delay.

Gazette notices and publication requirements

Gazette advertising remains under review. Publication has a long-established role, but it also creates a direct cost to the estate. In some cases, multiple Gazette notices can materially reduce creditor returns.

The consultation asks whether all current notice requirements still provide useful transparency, or whether some are unlikely to be used by creditors, employees or other stakeholders.

Improving creditor communication

Providing more information doesn’t always lead to stronger creditor engagement, as recognised in the consultation.

Creditors often receive lengthy documents, formal notices and statutory wording that may be legally accurate but difficult to navigate. Office-holders must comply with detailed requirements even where response rates are low.

Possible reforms include clearer communications, greater use of websites, self-service access to case information and more targeted disclosures.

Better use of guidance

The consultation asks whether some routine information currently sent by office-holders to creditors could be shared in a different way. It recognises that creditors can receive a lot of information, and not all of it needs a response. Some of it’s simply there to explain the process. Different creditors may also need different levels of detail, depending on their role and interest in the case.
The suggestion is that rather than office-holders being required to provide the information, it could instead be made available centrally, via GOV.UK, with links to additional information where appropriate.

Electronic communication and deemed consent

Uncertainty in the current deemed consent framework, including whether electronic communication’s been customarily used is highlighted in the consultation.

Options include simplifying deemed consent where an electronic address has been provided or is publicly available, and moving some explanatory wording from notices into government guidance.

Creditor committees

Whether the rules on creditor committees remain proportionate is one of the issues being considered in the consultation. Committees can play an important role in suitable cases, but they are rarely formed in many smaller insolvencies.
The right to form a committee should remain. The issue is whether office-holders should keep issuing invitations where there’s little prospect of a committee being established.

Balancing transparency with data protection

Insolvency processes require information sharing, but personal data can be misused. Fraud, phishing and identity-related scams increase the risk.

Office-holders may not know whether an individual creditor is vulnerable. They may also face tension between statutory disclosure obligations and data minimisation expectations.

The consultation asks how creditor addresses, creditor lists and online case portals should be handled, and how much personal data should be included in reports or decision notices.

Remuneration, fee estimates and creditor non-engagement

Remuneration is likely to be one of the consultation’s most important areas. The Rules must support creditor oversight while recognising low creditor engagement.

Fee estimates

Fee estimates are intended to give creditors clearer information before approving remuneration. Preparing detailed estimates can also add cost before the final shape of a case is known.

A key question is whether creditors use fee estimates in practice, how often they raise queries, and whether the current level of detail is still proportionate.

CVLs and the problem of no creditor vote

The consultation addresses what happens in creditors’ voluntary liquidations when creditors don’t vote on remuneration. Office-holders may be unable to draw fees or may need court approval at further expense.

Options include retaining the current approach, reintroducing scale fees, introducing a statutory fee mechanism or considering broader legislative reform.

Modernising court and filing processes

Some rules still assume paper-based processes, even though courts and practitioners increasingly work through digital systems.

The appointment of administrators is a key example, particularly where notices are filed outside normal court hours or the time of appointment depends on electronic filing systems.

The review also considers whether requirements to print, retain or lodge physical documents remain necessary where documents have already been filed or delivered electronically.

Small debts and employee claims

The consultation asks whether the current small debt threshold is still set at the right level. Increasing it could reduce the amount of work needed for low-value claims, but any change would need to balance efficiency with accuracy and fairness.

There may also be an opportunity to avoid duplication where employee claim information has already been checked through the Redundancy Payments Service. One option could be to use the small claims process for employee-related claims, but with much higher limits.

Future-proofing insolvency practice

Whether the Rules are still fit for a practice environment shaped by digital communication, data analysis, asset tracing and automation is a key question in the consultation.

Artificial intelligence

How artificial intelligence is being used in insolvency work and whether the Rules create barriers to responsible adoption is a key question raised in the consultation.

Key issues include transparency, professional judgement, data protection, audit trails and quality control. AI may improve efficiency, but office-holders remain responsible for decisions, compliance and professional standards.

Digital assets and cryptocurrency

Digital assets and cryptocurrency raise issues around identification, control, valuation, recovery, custody and realisation.

The government’s starting point appears to be that the existing framework can accommodate digital assets in many cases. The consultation asks whether clearer guidance or procedural support would improve outcomes.

Evidence themes under review

Across the consultation, the government is seeking evidence on where the Rules create cost, delay or uncertainty, and whether those requirements continue to deliver proportionate protection.

• Rules that may create avoidable duplication or cost.
• Current processes that may affect creditor returns or case progression.
• Areas where creditor engagement may be low despite significant administrative effort.
• Areas where digital practice may have moved beyond the assumptions in the Rules.
• Points where clearer guidance may support more consistent decision-making.
• Whether potential reforms would work across different case types and firm sizes.

A chance to inform the review

The consultation’s central question is whether the Rules still support effective insolvency practice in a modern environment.

Evidence from practice will help show where the system works, where it may slow cases down and where creditors may benefit from more targeted information.

We’ll review the consultation and engage with members as the response develops. The focus will be on areas where the Rules could be clearer, more efficient or better aligned with current practice.

The consultation is open until 6 October 2026.