Insolvency technical update – June 2023
By Steven Wood, Practice Support Specialist (Insolvency)
5 July 2023
We share our latest insolvency technical update – your round-up of recent developments in insolvency.
Financial Conduct Authority (FCA) ban on debt packager referral fees
The FCA has announced a ban on debt packager firms from being paid to refer customers on to other firms.
Following previous warnings to the sector, the FCA has concluded that debt packagers have a conflict of interest between giving advice in the customer’s best interest and making a recommendation that makes them more money. The FCA has determined that the conflict of interest, while it could be managed, is so strong that the debt packager business model leads these firms to not comply with FCA rules.
Find out more in our article on the announcement.
The Bankruptcy and Diligence (Scotland) Bill (‘the Bill’) – call for views
A reminder that the Bill has been referred to the Economy and Fair Work Committee, which has published a call for views in relation to the proposed changes. The call for views closes on 21 July 2023.
We have published an article looking at the Bill in more detail and our response to the call for views will be submitted and published shortly.
A call for views in relation to the Bill’s financial memorandum has also now been launched. The call for views closes on 15 August 2023.
Consultation on statement of insolvency practice (SIP) 3.3 – trust deeds
A final reminder that a working group of the Joint Insolvency Committee (JIC) has been reviewing SIP 3.3 – trust deeds and is inviting comments on the revised SIP by 10 July 2023.
The Moveable Transactions (Scotland) Act 2023
The Moveable Transactions (Scotland) Bill was passed by the Scottish parliament on 4 May 2023 and received Royal Assent on 13 June 2023, becoming the Moveable Transactions (Scotland) Act 2023.
The Act will modernise the law of Scotland in relation to moveable transactions. We previously published an article looking at the changes in more detail.
Dear IP
Dear IP 159 has been issued by the Insolvency Service. The issue provides details of changes to the conduct report questions in the director conduct reporting service (DCRS).
It also contains an update on an article in Dear IP 138 to provide greater clarity to IPs on RPS’s determination of employee status when assessing claims made by company directors.
Insolvency Service bulletin - improvements to RP14a reminders
The Insolvency Service has issued a bulletin setting out changes to the way the Redundancy Payments Service sends updates in cases where it has received an RP1 claim form, but no associated RP14a.
Associated guidance has been updated to reflect the introduction of the targeted weekly update email mentioned within the bulletin.
Debt respite scheme (breathing space) guidance
The Insolvency Service has updated its guidance for money advisors based on the recent court judgement in the case Kaye v Lees [2023] EWHC 152 (KB).
HMRC trust registration service manual
Following our intervention, HMRC’s trust registration service manual now clarifies that trusts used for individual voluntary arrangements (IVAs) and protected trust deeds (PTDs) are excluded from the trust registration service (TRS) as trusts which are incidental to the transactions of paying and transferring assets to creditors.
The Money Laundering and Terrorist Financing (High-Risk Countries) (Amendment) Regulations 2023
The above regulations came into force on 27 June 2023.
The regulations amend the list of high-risk third countries specified in schedule 3ZA of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017.
Specifically, Cambodia and Morocco are removed from schedule 3ZA to reflect changes in the Financial Action Task Force’s lists, and the significant progress made by these countries in addressing AML/CTF deficiencies.
United Kingdom Financial Intelligence Unit (UKFIU) guidance
The UKFIU has published its latest SARs reporter booklet of 2023 aimed at sharing information on the suspicious activity reports (SARs) regime.
Insolvency Service Forward Thinking conference call for papers
The Insolvency Service has issued a call for papers in relation to its policy and technical conference to be held on 10 November 2023.
Legal update
Münchener Hypothekenbank eG for an administration order in terms of schedule B1 to the Insolvency Act 1986 in respect of Seventeen Yellow Crowns Sàrl: An opinion of the Court of Session in relation to its decision to refuse a petition for an administration order in relation to a company incorporated under the laws of Luxembourg.
Register for the ICAS Insolvency and Restructuring Conference 2023
