Corporate Insolvency and Governance Bill (HC Bill 128)

(b) a majority of the pre-moratorium creditors who are
unconnected unsecured creditors vote against the
proposed end date.

(3) For the purposes of paragraph (2)—

(a) 5a creditor is unconnected unless the convener or chair
decides that the creditor is connected, and

(b) the total value of the unconnected creditors is the total
value of those unconnected creditors whose claims have
been admitted for voting.”

29 10Rule 4.073 has effect as if—

(a) after paragraph (3) there were inserted—

“(3A) Votes are calculated according to the amount of each pre-
moratorium creditor’s claim at the date of the meeting.”;

(b) for paragraph (4) there were substituted—

“(4) 15A debt of an unliquidated or unascertained amount is to be
valued at £1 for the purposes of voting unless the convener or
the chairman decides to put a higher value on it.”;

(c) for paragraph (5) there were substituted—

“(5) If a debt is partly or wholly secured the value of the debt for
20voting purposes is its full value without deduction of the
value of the security.”;

(d) for paragraph (6) there were substituted—

“(6) A pre-moratorium creditor under a hire-purchase agreement
is entitled to vote in respect of the amount of the debt due and
25payable by the company at the date of the meeting.

(6A) In calculating the amount of any debt for the purpose of
paragraph (6), no account is to be taken of any amount
attributable to the exercise of any right under the relevant
agreement so far as the right has become exercisable solely by
30virtue of a moratorium for the company coming into force.”

30 Rule 4.077 has effect as if—

(a) in paragraph (1) for “liquidation” there were substituted
“moratorium”;

(b) paragraph (4) were omitted.

35Content of application to the High Court for extension of moratorium

31 (1) An application by the directors of a company for the extension of a
moratorium under Article 13CD of the Insolvency (Northern Ireland) Order
1989 must state—

(a) that it is made under that Article,

(b) 40the length of the extension sought,

(c) identification details for the company to which the application
relates, and

(d) the company’s address for service.

(2) The application must be authenticated by or on behalf of the directors (see
45paragraph 49).

Timing of statements accompanying application to High Court for extension of moratorium

32 A statement under Article 13CD(2) must be made within the period of 3 days
ending with the day on which the application under that Article is made.

Notices about change in end of moratorium

33 (1) 5A notice under Article 13CH(1) of the Insolvency (Northern Ireland) Order
1989 must be given within the period of 5 days beginning with the day on
which the duty to give the notice arises.

(2) The notice must state—

(a) the name of the company to which it relates, and

(b) 10the provision by virtue of which the moratorium was extended or
came to an end.

34 (1) A notice under Article 13CH(2) or (3) of the Insolvency (Northern Ireland)
Order 1989 must be given within the period of 5 days beginning with the day
on which the duty to give the notice arises.

(2) 15The notice must state—

(a) the provision under which it is given,

(b) the nature of the notice,

(c) the date of the notice,

(d) that it is given by the monitor acting in that capacity,

(e) 20the name and contact details of the monitor, and

(f) the identification details for the company to which it relates.

(3) A notice under Article 13CH(2) or (3) of the Insolvency (Northern Ireland)
Order 1989 that is given to the registrar must be authenticated by or on
behalf of the monitor (see paragraph 49).

35 25Where a moratorium comes to an end under Article 13CG of the Insolvency
(Northern Ireland) Order 1989 because the company has entered into a
relevant insolvency procedure within the meaning of that Article, the
notices under Article 13CH(1) and (2) must state—

(a) the date on which the company entered into the relevant insolvency
30procedure, and

(b) the name and contact details of the supervisor of the voluntary
arrangement, the administrator or the liquidator.

36 (1) A notice under Article 13CH(4) of the Insolvency (Northern Ireland) Order
1989 must be given within the period of 3 business days beginning with the
35day on which the notice under Article 13ED(1) of that Order is filed with the
High Court.

(2) The notice under Article 13CH(4) of that Order must be accompanied by the
notice that the monitor has filed with the High Court under Article 13ED(1)
of that Order.

40Notification by directors of insolvency proceedings etc

37 (1) A notice under Article 13DF(1) of the Insolvency (Northern Ireland) Order
1989 must be given before the period of 3 days ending with the day on which
the step mentioned there is taken.

(2) A notice under Article 13DF(2) of the Insolvency (Northern Ireland) Order
1989 must be given within the period of 3 days beginning with the day on
which the duty to give the notice arises.

Notice of termination of moratorium

38 (1) 5A notice under Article 13ED(1) of the Insolvency (Northern Ireland) Order
1989 must be filed with the High Court as soon as practicable after the duty
in that paragraph arises.

(2) The notice must state—

(a) the provision under which it is given,

(b) 10the nature of the notice,

(c) the date of the notice,

(d) the name and contact details of the monitor,

(e) the identification details for the company to which it relates,

(f) the grounds on which the moratorium is being terminated,

(g) 15the monitor’s reasons for concluding that those grounds are made
out, and

(h) the date on which the monitor concluded that those grounds were
made out.

(3) The notice must be authenticated by or on behalf of the monitor (see
20paragraph 49).

Termination of moratorium under Article 13ED(1)(d) of the Insolvency (Northern Ireland)
Order 1989

39 For the purposes of deciding whether to bring a moratorium to an end under
Article 13ED(1)(d) of the Insolvency (Northern Ireland) Order 1989 the
25monitor must disregard—

(a) any debts that the monitor has reasonable grounds for thinking are
likely to be paid within 5 days of the decision, and

(b) any debts in respect of which the creditor has agreed to defer
payment until a time that is later than the decision.

30Replacement of monitor or additional monitor: statement and consent to act

40 (1) A statement under Article 13EE(4) of the Insolvency (Northern Ireland)
Order 1989 must be headed “Proposed monitor’s statement and consent to
act” and must contain the following—

(a) a certificate that the proposed monitor is qualified to act as an
35insolvency practitioner in relation to the company,

(b) the proposed monitor’s IP number,

(c) the name of the relevant recognised professional body which is the
source of the proposed monitor’s authorisation to act in relation to
the company, and

(d) 40a statement that the proposed monitor consents to act as monitor in
relation to the company.

(2) The statement must be made within the period of 5 days ending with the day
on which it is filed with the High Court.

(3) In this paragraph “IP number” means the identifying number or reference
issued to the insolvency practitioner by a professional body recognised
under Article 350 of the Insolvency (Northern Ireland) Order 1989.

Replacement of monitor or additional monitor: notification

41 (1) 5A notice under Article 13EE(8) of the Insolvency (Northern Ireland) Order
1989 must state—

(a) the provision under which it is given,

(b) the nature of the notice,

(c) the date of the notice,

(d) 10the identification details for the company to which it relates,

(e) that it is given by the monitor acting in that capacity, and

(f) the name and contact details of the monitor.

(2) The notice must be authenticated by the monitor (see paragraph 49).

Challenge to monitor’s remuneration

42 (1) 15An administrator or liquidator of a company may apply to the High Court
on the ground that remuneration charged by the monitor in relation to a
prior moratorium for the company under Part 1A of the Insolvency
(Northern Ireland) Order 1989 was excessive.

(2) An application under this paragraph may not be made after the end of the
20period of 2 years beginning with the day after the moratorium ends.

(3) On an application under this paragraph the Court may—

(a) dismiss the application,

(b) order the monitor to repay some or all of the remuneration, or

(c) make such other order as it thinks fit.

(4) 25The costs of an application under this paragraph are, unless the Court orders
otherwise, to be paid as an expense of the administration or liquidation.

Challenge to directors’ actions: meeting

43 Where the High Court makes an order by virtue of Article 13FB(4)(c) of the
Insolvency (Northern Ireland) Order 1989 requiring the summoning of a
30meeting of a company’s creditors, the following provisions of the Insolvency
Rules apply for the purposes of that meeting to the extent set out in the
Court’s order and subject to any modifications set out in the Court’s order—

(a) Rules 4.061 to 4.077 (meetings);

(b) Part 8 (proxies);

(c) 35Rule 12.05 (quorum).

Priority of moratorium debts etc in subsequent winding up

44 (1) Where Article 148A of the Insolvency (Northern Ireland) Order 1989 applies,
the moratorium debts and pre-moratorium debts mentioned in paragraph
(2)(b) of that Article are payable in the following order of priority—

(a) 40amounts payable in respect of goods or services supplied during the
moratorium under a contract where, but for Article 197B(3) or (4) of
that Order, the supplier would not have had to make that supply;

(b) wages or salary arising under a contract of employment;

(c) other debts or other liabilities apart from the monitor’s remuneration
or expenses;

(d) the monitor’s remuneration or expenses.

(2) 5In this paragraph “wages or salary” has the same meaning as in Article 13D
of the Insolvency (Northern Ireland) Order 1989.

Priority of moratorium debts etc in subsequent administration

45 (1) Where paragraph 65A(1) of Schedule B1 to the Insolvency (Northern
Ireland) Order 1989 applies, the moratorium debts and pre-moratorium
10debts mentioned in paragraph 65A(2) of that Schedule are payable in the
following order of priority—

(a) amounts payable in respect of goods or services supplied during the
moratorium under a contract where, but for Article 197B(3) or (4) of
that Order, the supplier would not have had to make that supply;

(b) 15wages or salary arising under a contract of employment;

(c) other debts or other liabilities apart from the monitor’s remuneration
or expenses;

(d) the monitor’s remuneration or expenses.

(2) In this paragraph “wages or salary” has the same meaning as in Article 13D
20of the Insolvency (Northern Ireland) Order 1989.

Prescribed format of documents

46 (1) Rule 12.04 of the Insolvency Rules applies to applications and statements
referred to in Part 1A of the Insolvency (Northern Ireland) Order 1989 as it
applies to notices under that Order.

(2) 25The requirement in Rule 12.04 that a notice, application or statement
required or authorised by or under the Order or the Insolvency Rules must
be in writing is satisfied if the notice, application or statement is in electronic
form.

(3) But sub-paragraph (2) does not apply in relation to the filing of a notice,
30application or statement with the High Court.

(4) A document in electronic form must be capable of being—

(a) read by the recipient in electronic form, and

(b) reproduced by the recipient in hard-copy form.

47 (1) This paragraph applies where a provision of this Part of this Schedule sets
35out requirements as to the contents of a document.

(2) Any title required by the provision must appear at the beginning of the
document.

(3) Any other contents required by the provision (or provisions where more
than one applies to a particular document) must be provided in the order
40listed in the provision (or provisions) or in another order which the maker
of the document considers would be convenient for the intended recipient.

48 Where a provision of this Part of this Schedule sets out the required contents
of a document, the document may depart from the required contents if—

(a) the circumstances require such a departure (including where the
requirement is not applicable in the particular case), or

(b) the departure (whether or not intentional) is immaterial.

Authentication of applications, notices and statements

49 (1) 5This paragraph sets out how an application, notice or statement is to be
authenticated for the purposes of this Part of this Schedule.

(2) An application, notice or statement in electronic form is authenticated—

(a) if the identity of the sender is confirmed in a manner specified by the
recipient, or

(b) 10where the recipient has not so specified, if the communication
contains or is accompanied by a statement of the identity of the
sender and the recipient has no reason to doubt the truth of that
statement.

(3) An application, notice or statement in hard-copy form is authenticated if it
15is signed.

(4) If an application, notice or statement is authenticated by the signature of an
individual on behalf of—

(a) a body of persons, the document must also state the position of that
individual in relation to the body;

(b) 20a body corporate of which the individual is the sole member, the
document must also state that fact.

Modifications to the Insolvency Rules

50 (1) For the purposes of proceedings under Part 1A of the Insolvency (Northern
Ireland) Order 1989 and for proceedings under this Part of this Schedule the
25Insolvency Rules have effect with—

(a) the modifications set out in sub-paragraphs (3) to (13), and

(b) any other necessary modifications.

(2) Sub-paragraph (1)(b) is subject to—

(a) paragraphs 23 to 30 and 46 of this Schedule;

(b) 30any modifications set out in an order under paragraph 43 of this
Schedule.

(3) Rule 0.2 has effect as if, in the definition of “insolvency proceedings”, after
“the Order” there were inserted “, Part 3 of Schedule 8 to the Corporate
Insolvency and Governance Act 2020”.

(4) 35Rule 7.01 has effect as if for “Parts II to VII of the Order” there were
substituted “Part 1A of the Order or Part 3 of Schedule 8 to the Corporate
Insolvency and Governance Act 2020”.

(5) Rule 7.07(1)(a) has effect as if after “the Order” there were inserted “or Part
3 of Schedule 8 to the Corporate Insolvency and Governance Act 2020”.

(6) 40Rule 7.08 has effect in relation to a regulated company (within the meaning
of Article 13H of the Insolvency (Northern Ireland) Order 1989) as if it also
required the application to be served on the appropriate regulator (within
the meaning of that Article).

(7) Rule 7.12(1)(b) has effect as if after sub-paragraph (v) there were inserted—

“(vi) a monitor in relation to a moratorium.”

(8) Rule 7.13B has effect as if—

(a) the references to an office-holder included a monitor in relation to a
5moratorium, and

(b) after paragraph (2)(d) there were inserted “, or

“(e) monitor in relation to a moratorium.”

(9) Rule 7.13C has effect as if after each of paragraph (2)(f) and (3)(f) there were
inserted “; and

“(g) 10Article 13EE (replacement of monitor or appointment of
additional monitor).”

(10) Rule 7.36(2) has effect as if it required the applicant to serve a sealed copy of
the application on the monitor and the company to which the moratorium
relates.

(11) 15Omit Rules 7.07A and 7.08A.

(12) Rule 7.27 has effect as if paragraph (2)(a) included a reference to proceedings
under Part 1A of the Insolvency (Northern Ireland) Order 1989 or this Part
of this Schedule.

(13) After Rule 12.23 insert—

• 20“Court orders

• 12.24. Notwithstanding any requirement in these Rules as to the
  contents of a court order the court may make such other order or in
  such form as the court thinks fit.”

Identification details for a company

51 (1) 25Where a provision of this Part of this Schedule requires a document to
contain identification details for a company that is registered under the
Companies Act 2006 in Northern Ireland, the following information must be
given—

(a) the company’s registered name;

(b) 30its registered number;

(2) Where a provision of this Part of this Schedule requires a document to
contain identification details for a company that has registered particulars
under section 1046(1) of the Companies Act 2006 (registered overseas
companies), the following information must be given—

(a) 35the name registered by the company under section 1047 of that Act,

(b) the number under which it is registered, and

(c) the country or territory in which it is incorporated.

(3)
Where a provision of this Part of this Schedule requires a document to
contain identification details for an unregistered company that does not
40come within sub-paragraph (2) the following information must be given—

(a) the company’s name, and

(b) the postal address of any principal place of business.

Contact details of a monitor or other office-holder

52 Where a provision of this Part of this Schedule requires a document to
contain contact details of a monitor or other office-holder, the following
information must be given—

(a) 5a postal address for the monitor or office-holder, and

(b) either an email address, or a telephone number, through which the
monitor may be contacted.

“The Insolvency Rules”

53 In this Part of this Schedule “the Insolvency Rules” means the Insolvency
10Rules (Northern Ireland) 1991 (S.R. (N.I.) 1991/364).

Interpretation: general

54 Expressions used in this Part of this Schedule are to be construed as if this
Part of this Schedule were contained in Part 1A of the Insolvency (Northern
Ireland) Order 1989.

Section 7

SCHEDULE 9 Arrangements and reconstructions for companies in financial difficulty

Part 1 Main provisions

1 20In the Companies Act 2006, after Part 26 insert—

““Part 26A Arrangements and reconstructions: companies in financial
difficulty

Application of this Part

901A 25Application of this Part

(1) The provisions of this Part apply where conditions A and B are met
in relation to a company.

(2) Condition A is that the company has encountered, or is likely to
encounter, financial difficulties that are affecting, or will or may
30affect, its ability to carry on business as a going concern.

(3) Condition B is that—

(a) a compromise or arrangement is proposed between the
company and—

(i) its creditors, or any class of them, or

(ii) 35its members, or any class of them, and

(b) the purpose of the compromise or arrangement is to
eliminate, reduce or prevent, or mitigate the effect of, any of
the financial difficulties mentioned in subsection (2).

(4) In this Part—

• 5“arrangement” includes a reorganisation of the company’s
  share capital by the consolidation of shares of different
  classes or by the division of shares into shares of different
  classes, or by both of those methods;

• “company”—

  (a)

  10in section 901J (powers of court to facilitate
  reconstruction or amalgamation) means a company
  within the meaning of this Act, and

  (b)

  elsewhere in this Part means any company liable to be
  wound up under the Insolvency Act 1986 or the
  15Insolvency (Northern Ireland) Order 1989 (S.I. 1989/
  2405 (N.I. 19)).

(5) The provisions of this Part have effect subject to Part 27 (mergers and
divisions of public companies) where that Part applies (see sections
902 and 903).

901B 20Power to exclude companies providing financial services, etc

(1) The Secretary of State may by regulations provide that this Part does
not apply—

(a) where the company in respect of which a compromise or
arrangement is proposed is an authorised person, or an
25authorised person of a specified description;

(b) where—

(i) a compromise or arrangement is proposed between a
company, or a company of a specified description,
and any creditors of the company, and

(ii) 30those creditors consist of or include creditors of a
specified description.

(2) In this section—

• “authorised person” has the same meaning as in the Financial
  Services and Markets Act 2000 (see section 31 of that Act);

• 35“specified” means specified in the regulations.

(3) Regulations under this section are subject to affirmative resolution
procedure.

Meeting of creditors or members

901C Court order for holding of meeting

(1) 40The court may, on an application under this subsection, order a
meeting of the creditors or class of creditors, or of the members of the
company or class of members (as the case may be), to be summoned
in such manner as the court directs.

(2) An application under subsection (1) may be made by—

(a) 45the company,

(b) any creditor or member of the company,

(c) if the company is being wound up, the liquidator, or

(d) if the company is in administration, the administrator.

(3) Every creditor or member of the company whose rights are affected
by the compromise or arrangement must be permitted to participate
5in a meeting ordered to be summoned under subsection (1).

(4) But subsection (3) does not apply in relation to a class of creditors or
members of the company if, on an application under this subsection,
the court is satisfied that none of the members of that class has a
genuine economic interest in the company.

(5) 10An application under subsection (4) is to be made by the person who
made the application under subsection (1) in respect of the
compromise or arrangement.

(6) Section 323 (representation of corporations at meetings) applies to a
meeting of creditors under this section as to a meeting of the
15company (references to a member of the company being read as
references to a creditor).

(7) This section is subject to sections 901H and 901I (special cases).

901D Statement to be circulated or made available

(1) Where a meeting is summoned under section 901C—

(a) 20every notice summoning the meeting that is sent to a creditor
or member must be accompanied by a statement complying
with this section, and

(b) every notice summoning the meeting that is given by
advertisement must either—

(i) 25include such a statement, or

(ii) state where and how creditors or members entitled to
attend the meeting may obtain copies of such a
statement.

(2) The statement must—

(a) 30explain the effect of the compromise or arrangement, and

(b) in particular, state—

(i) any material interests of the directors of the company
(whether as directors or as members or as creditors of
the company or otherwise), and

(ii) 35the effect on those interests of the compromise or
arrangement, in so far as it is different from the effect
on the like interests of other persons.

(3) Where the compromise or arrangement affects the rights of
debenture holders of the company, the statement must give the like
40explanation as respects the trustees of any deed for securing the issue
of the debentures as it is required to give as respects the company’s
directors.

(4) Where a notice given by advertisement states that copies of an
explanatory statement can be obtained by creditors or members
45entitled to attend the meeting, every such creditor or member is
entitled, on making application in the manner indicated by the