(1) In this Part—
“partial authorisation” means authorisation to act as an insolvency practitioner—
only in relation to companies, or
only in relation to individuals;
“full authorisation” means authorisation to act as an insolvency practitioner in relation to companies, individuals and insolvent partnerships;
“partially authorised” and “fully authorised” are to be construed accordingly.
(2) A person is fully authorised under this section to act as an insolvency practitioner—
(a) by virtue of being a member of a professional body recognised under section 391(1) and being permitted to act as an insolvency practitioner for all purposes by or under the rules of that body, or
(b) by holding an authorisation granted by the Department of Enterprise, Trade and Investment in Northern Ireland under Article 352 of the Insolvency (Northern Ireland) Order 1989.
(3) A person is partially authorised under this section to act as an insolvency practitioner—
(a) by virtue of being a member of a professional body recognised under section 391(1) and being permitted to act as an insolvency practitioner in relation only to companies or only to individuals by or under the rules of that body, or
(b) by virtue of being a member of a professional body recognised under section 391(2) and being permitted to act as an insolvency practitioner by or under the rules of that body.
390B Partial authorisation: acting in relation to partnerships
(1) A person who is partially authorised to act as an insolvency practitioner in relation to companies may nonetheless not accept an appointment to act in relation to a company if at the time of the appointment the person is aware that the company—
(a) is or was a member of a partnership, and
(b) has outstanding liabilities in relation to the partnership.
(2) A person who is partially authorised to act as an insolvency practitioner in relation to individuals may nonetheless not accept an appointment to act in relation to an individual if at the time of the appointment the person is aware that the individual—
(a) is or was a member of a partnership other than a Scottish partnership, and
(b) has outstanding liabilities in relation to the partnership.
(3) Subject to subsection (9), a person who is partially authorised to act as an insolvency practitioner in relation to companies may nonetheless not continue to act in relation to a company if the person becomes aware that the company—
(a) is or was a member of a partnership, and
(b) has outstanding liabilities in relation to the partnership,
unless the person is granted permission to continue to act by the court.
(4) Subject to subsection (9), a person who is partially authorised to act as an insolvency practitioner in relation to individuals may nonetheless not continue to act in relation to an individual if the person becomes aware that the individual—
(a) is or was a member of a partnership other than a Scottish partnership, and
(b) has outstanding liabilities in relation to the partnership,
unless the person is granted permission to continue to act by the court.
(5) The court may grant a person permission to continue to act for the purposes of subsection (3) or (4) if it is satisfied that the person is competent to do so.
(6) A person who is partially authorised and becomes aware as mentioned in subsection (3) or (4) may alternatively apply to the court for an order (a “ replacement order ”) appointing in his or her place a person who is fully authorised to act as an insolvency practitioner in relation to the company or (as the case may be) the individual.
(7) A person may apply to the court for permission to continue to act or for a replacement order under—
(a) where acting in relation to a company, this section or, if it applies, section 168(5B) (member of insolvent partnership: England and Wales);
(b) where acting in relation to an individual, this section or, if it applies, section 303(2C) (member of insolvent partnership: England and Wales).
(8) A person who acts as an insolvency practitioner in contravention of any of subsections (1) to (4) is guilty of an offence under section 389 (acting without qualification).
(9) A person does not contravene subsection (3) or (4) by continuing to act as an insolvency practitioner during the permitted period if, within the period of 7 business days beginning with the day after the day on which the person becomes aware as mentioned in the subsection, the person—
(a) applies to the court for permission to continue to act, or
(b) applies to the court for a replacement order.
(10) For the purposes of subsection (9)—
“business day” means any day other than a Saturday, a Sunday, Christmas Day, Good Friday or a day which is a bank holiday in any part of Great Britain;
“permitted period” means the period beginning with the day on which the person became aware as mentioned in subsection (3) or (4) and ending on the earlier of—
the expiry of the period of 6 weeks beginning with the day on which the person applies to the court as mentioned in subsection (9)(a) or (b), and
the day on which the court disposes of the application (by granting or refusing it);
“replacement order” has the meaning given by subsection (6).
(1) The Secretary of State may by order, if satisfied that a body meets the requirements of subsection (4), declare the body to be a recognised professional body which is capable of providing its insolvency specialist members with full authorisation or partial authorisation.
(2) The Secretary of State may by order, if satisfied that a body meets the requirements of subsection (4), declare the body to be a recognised professional body which is capable of providing its insolvency specialist members with partial authorisation only of the kind specified in the order (as to which, see section 390A(1)).
(3) Section 391A makes provision about the making by a body of an application to the Secretary of State for an order under this section.
(4) The requirements are that—
(a) the body regulates (or is going to regulate) the practice of a profession,
(b) the body has rules which it is going to maintain and enforce for securing that its insolvency specialist members—
(i) are fit and proper persons to act as insolvency practitioners, and
(ii) meet acceptable requirements as to education and practical training and experience, and
(c) the body's rules and practices for or in connection with authorising persons to act as insolvency practitioners, and its rules and practices for or in connection with regulating persons acting as such, are designed to ensure that the regulatory objectives are met (as to which, see section 391C).
(5) An order of the Secretary of State under this section has effect from such date as is specified in the order.
(6) An order under this section may be revoked by an order under section 391L or 391N (and see section 415A(1)(b)).
(7) In this Part—
(a) references to members of a recognised professional body are to persons who, whether members of that body or not, are subject to its rules in the practice of the profession in question;
(b) references to insolvency specialist members of a professional body are to members who are permitted by or under the rules of the body to act as insolvency practitioners.
(8) A reference in this Part to a recognised professional body is to a body recognised under this section (and see sections 391L(6) and 391N(5)).
391A Application for recognition as recognised professional body
(1) An application for an order under section 391(1) or (2) must—
(a) be made to the Secretary of State in such form and manner as the Secretary of State may require,
(b) be accompanied by such information as the Secretary of State may require, and
(c) be supplemented by such additional information as the Secretary of State may require at any time between receiving the application and determining it.
(2) The requirements which may be imposed under subsection (1) may differ as between different applications.
(3) The Secretary of State may require information provided under this section to be in such form, and verified in such manner, as the Secretary of State may specify.
(4) An application for an order under section 391(1) or (2) must be accompanied by—
(a) a copy of the applicant's rules,
(b) a copy of the applicant's policies and practices, and
(c) a copy of any guidance issued by the applicant in writing.
(5) The reference in subsection (4)(c) to guidance issued by the applicant is a reference to guidance or recommendations which are—
(a) issued or made by it which will apply to its insolvency specialist members or to persons seeking to become such members,
(b) relevant for the purposes of this Part, and
(c) intended to have continuing effect,
including guidance or recommendations relating to the admission or expulsion of members.
(6) The Secretary of State may refuse an application for an order under section 391(1) or (2) if the Secretary of State considers that recognition of the body concerned is unnecessary having regard to the existence of one or more other bodies which have been or are likely to be recognised under section 391.
(7) Subsection (8) applies where the Secretary of State refuses an application for an order under section 391(1) or (2); and it applies regardless of whether the application is refused on the ground mentioned in subsection (6), because the Secretary of State is not satisfied as mentioned in section 391(1) or (2) or because a fee has not been paid (see section 415A(1)(b)).
(8) The Secretary of State must give the applicant a written notice of the Secretary of State's decision; and the notice must set out the reasons for refusing the application.
(1) In discharging regulatory functions, a recognised professional body must, so far as is reasonably practicable, act in a way—
(a) which is compatible with the regulatory objectives, and
(b) which the body considers most appropriate for the purpose of meeting those objectives.
(2) In discharging functions under this Part, the Secretary of State must have regard to the regulatory objectives.
391C Meaning of “regulatory functions” and “regulatory objectives”
(1) This section has effect for the purposes of this Part.
(2) “Regulatory functions”, in relation to a recognised professional body, means any functions the body has—
(a) under or in relation to its arrangements for or in connection with—
(i) authorising persons to act as insolvency practitioners, or
(ii) regulating persons acting as insolvency practitioners, or
(b) in connection with the making or alteration of those arrangements.
(3) “Regulatory objectives” means the objectives of—
(a) having a system of regulating persons acting as insolvency practitioners that—
(i) secures fair treatment for persons affected by their acts and omissions,
(ii) reflects the regulatory principles, and
(iii) ensures consistent outcomes,
(b) encouraging an independent and competitive insolvency-practitioner profession whose members—
(i) provide high quality services at a cost to the recipient which is fair and reasonable,
(ii) act transparently and with integrity, and
(iii) consider the interests of all creditors in any particular case,
(c) promoting the maximisation of the value of returns to creditors and promptness in making those returns, and
(d) protecting and promoting the public interest.
(4) In subsection (3)(a), “regulatory principles” means—
(a) the principles that regulatory activities should be transparent, accountable, proportionate, consistent and targeted only at cases in which action is needed, and
(b) any other principle appearing to the body concerned (in the case of the duty under section 391B(1)), or to the Secretary of State (in the case of the duty under section 391B(2)), to lead to best regulatory practice.
(1) This section applies if the Secretary of State is satisfied that an act or omission of a recognised professional body (or a series of such acts or omissions) in discharging one or more of its regulatory functions has had, or is likely to have, an adverse impact on the achievement of one or more of the regulatory objectives.
(2) The Secretary of State may, if in all the circumstances of the case satisfied that it is appropriate to do so, direct the body to take such steps as the Secretary of State considers will counter the adverse impact, mitigate its effect or prevent its occurrence or recurrence.
(3) A direction under this section may require a recognised professional body—
(a) to take only such steps as it has power to take under its regulatory arrangements;
(b) to take steps with a view to the modification of any part of its regulatory arrangements.
(4) A direction under this section may require a recognised professional body—
(a) to take steps with a view to the institution of, or otherwise in respect of, specific regulatory proceedings;
(b) to take steps in respect of all, or a specified class of, such proceedings.
(5) For the purposes of this section, a direction to take steps includes a direction which requires a recognised professional body to refrain from taking a particular course of action.
(6) In this section “regulatory arrangements”, in relation to a recognised professional body, means the arrangements that the body has for or in connection with—
(a) authorising persons to act as insolvency practitioners, or
(b) regulating persons acting as insolvency practitioners.
(1) Before giving a recognised professional body a direction under section 391D, the Secretary of State must give the body a notice accompanied by a draft of the proposed direction.
(2) The notice under subsection (1) must—
(a) state that the Secretary of State proposes to give the body a direction in the form of the accompanying draft,
(b) specify why the Secretary of State has reached the conclusions mentioned in section 391D(1) and (2), and
(c) specify a period within which the body may make written representations with respect to the proposal.
(3) The period specified under subsection (2)(c)—
(a) must begin with the date on which the notice is given to the body, and
(b) must not be less than 28 days.
(4) On the expiry of that period, the Secretary of State must decide whether to give the body the proposed direction.
(5) The Secretary of State must give notice of that decision to the body.
(6) Where the Secretary of State decides to give the proposed direction, the notice under subsection (5) must—
(a) contain the direction,
(b) state the time at which the direction is to take effect, and
(c) specify the Secretary of State's reasons for the decision to give the direction.
(7) Where the Secretary of State decides to give the proposed direction, the Secretary of State must publish the notice under subsection (5); but this subsection does not apply to a direction to take any step with a view to the institution of, or otherwise in respect of, regulatory proceedings against an individual.
(8) The Secretary of State may revoke a direction under section 391D; and, where doing so, the Secretary of State—
(a) must give the body to which the direction was given notice of the revocation, and
(b) must publish the notice and, if the notice under subsection (5) was published under subsection (7), must do so (if possible) in the same manner as that in which that notice was published.
(1) This section applies if the Secretary of State is satisfied—
(a) that a recognised professional body has failed to comply with a requirement to which this section applies, and
(b) that, in all the circumstances of the case, it is appropriate to impose a financial penalty on the body.
(2) This section applies to a requirement imposed on the recognised professional body—
(a) by a direction given under section 391D, or
(b) by a provision of this Act or of subordinate legislation under this Act.
(3) The Secretary of State may impose a financial penalty, in respect of the failure, of such amount as the Secretary of State considers appropriate.
(4) In deciding what amount is appropriate, the Secretary of State—
(a) must have regard to the nature of the requirement which has not been complied with, and
(b) must not take into account the Secretary of State's costs in discharging functions under this Part.
(5) A financial penalty under this section is payable to the Secretary of State; and sums received by the Secretary of State in respect of a financial penalty under this section (including by way of interest) are to be paid into the Consolidated Fund.
(6) In sections 391G to 391I, “penalty” means a financial penalty under this section.
(1) Before imposing a penalty on a recognised professional body, the Secretary of State must give notice to the body—
(a) stating that the Secretary of State proposes to impose a penalty and the amount of the proposed penalty,
(b) specifying the requirement in question,
(c) stating why the Secretary of State is satisfied as mentioned in section 391F(1), and
(d) specifying a period within which the body may make written representations with respect to the proposal.
(2) The period specified under subsection (1)(d)—
(a) must begin with the date on which the notice is given to the body, and
(b) must not be less than 28 days.
(3) On the expiry of that period, the Secretary of State must decide—
(a) whether to impose a penalty, and
(b) whether the penalty should be the amount stated in the notice or a reduced amount.
(4) The Secretary of State must give notice of the decision to the body.
(5) Where the Secretary of State decides to impose a penalty, the notice under subsection (4) must—
(a) state that the Secretary of State has imposed a penalty on the body and its amount,
(b) specify the requirement in question and state—
(i) why it appears to the Secretary of State that the requirement has not been complied with, or
(ii) where, by that time, the requirement has been complied with, why it appeared to the Secretary of State when giving the notice under subsection (1) that the requirement had not been complied with, and
(c) specify a time by which the penalty is required to be paid.
(6) The time specified under subsection (5)(c) must be at least three months after the date on which the notice under subsection (4) is given to the body.
(7) Where the Secretary of State decides to impose a penalty, the Secretary of State must publish the notice under subsection (4).
(8) The Secretary of State may rescind or reduce a penalty imposed on a recognised professional body; and, where doing so, the Secretary of State—
(a) must give the body notice that the penalty has been rescinded or reduced to the amount stated in the notice, and
(b) must publish the notice; and it must (if possible) be published in the same manner as that in which the notice under subsection (4) was published.
(1) A recognised professional body on which a penalty is imposed may appeal to the court on one or more of the appeal grounds.
(2) The appeal grounds are—
(a) that the imposition of the penalty was not within the Secretary of State's power under section 391F;
(b) that the requirement in respect of which the penalty was imposed had been complied with before the notice under section 391G(1) was given;
(c) that the requirements of section 391G have not been complied with in relation to the imposition of the penalty and the interests of the body have been substantially prejudiced as a result;
(d) that the amount of the penalty is unreasonable;
(e) that it was unreasonable of the Secretary of State to require the penalty imposed to be paid by the time specified in the notice under section 391G(5)(c).
(3) An appeal under this section must be made within the period of three months beginning with the day on which the notice under section 391G(4) in respect of the penalty is given to the body.
(4) On an appeal under this section the court may—
(a) quash the penalty,
(b) substitute a penalty of such lesser amount as the court considers appropriate, or
(c) in the case of the appeal ground in subsection (2)(e), substitute for the time imposed by the Secretary of State a different time.
(5) Where the court substitutes a penalty of a lesser amount, it may require the payment of interest on the substituted penalty from such time, and at such rate, as it considers just and equitable.
(6) Where the court substitutes a later time for the time specified in the notice under section 391G(5)(c), it may require the payment of interest on the penalty from the substituted time at such rate as it considers just and equitable.
(7) Where the court dismisses the appeal, it may require the payment of interest on the penalty from the time specified in the notice under section 391G(5)(c) at such rate as it considers just and equitable.
(8) In this section, “the court” means the High Court or, in Scotland, the Court of Session.
(1) If the whole or part of a penalty is not paid by the time by which it is required to be paid, the unpaid balance from time to time carries interest at the rate for the time being specified in section 17 of the Judgments Act 1838 (but this is subject to any requirement imposed by the court under section 391H(5), (6) or (7)).
(2) If an appeal is made under section 391H in relation to a penalty, the penalty is not required to be paid until the appeal has been determined or withdrawn.
(3) Subsection (4) applies where the whole or part of a penalty has not been paid by the time it is required to be paid and—
(a) no appeal relating to the penalty has been made under section 391H during the period within which an appeal may be made under that section, or
(b) an appeal has been made under that section and determined or withdrawn.
(4) The Secretary of State may recover from the recognised professional body in question, as a debt due to the Secretary of State, any of the penalty and any interest which has not been paid.
(1) This section applies if the Secretary of State is satisfied that an act or omission of a recognised professional body (or a series of such acts or omissions) in discharging one or more of its regulatory functions has had, or is likely to have, an adverse impact on the achievement of one or more of the regulatory objectives.
(2) The Secretary of State may, if in all the circumstances of the case satisfied that it is appropriate to do so, publish a statement reprimanding the body for the act or omission (or series of acts or omissions).
(1) If the Secretary of State proposes to publish a statement under section 391J in respect of a recognised professional body, it must give the body a notice—
(a) stating that the Secretary of State proposes to publish such a statement and setting out the terms of the proposed statement,
(b) specifying the acts or omissions to which the proposed statement relates, and
(c) specifying a period within which the body may make written representations with respect to the proposal.
(2) The period specified under subsection (1)(c)—
(a) must begin with the date on which the notice is given to the body, and
(b) must not be less than 28 days.
(3) On the expiry of that period, the Secretary of State must decide whether to publish the statement.
(4) The Secretary of State may vary the proposed statement; but before doing so, the Secretary of State must give the body notice—
(a) setting out the proposed variation and the reasons for it, and
(b) specifying a period within which the body may make written representations with respect to the proposed variation.
(5) The period specified under subsection (4)(b)—
(a) must begin with the date on which the notice is given to the body, and
(b) must not be less than 28 days.
(6) On the expiry of that period, the Secretary of State must decide whether to publish the statement as varied.
391L Revocation of recognition at instigation of Secretary of State
(1) An order under section 391(1) or (2) in relation to a recognised professional body may be revoked by the Secretary of State by order if the Secretary of State is satisfied that—
(a) an act or omission of the body (or a series of such acts or omissions) in discharging one or more of its regulatory functions has had, or is likely to have, an adverse impact on the achievement of one or more of the regulatory objectives, and
(b) it is appropriate in all the circumstances of the case to revoke the body's recognition under section 391.
(2) If the condition set out in subsection (3) is met, an order under section 391(1) in relation to a recognised professional body may be revoked by the Secretary of State by an order which also declares the body concerned to be a recognised professional body which is capable of providing its insolvency specialist members with partial authorisation only of the kind specified in the order (see section 390A(1)).
(3) The condition is that the Secretary of State is satisfied—
(a) as mentioned in subsection (1)(a), and
(b) that it is appropriate in all the circumstances of the case for the body to be declared to be a recognised professional body which is capable of providing its insolvency specialist members with partial authorisation only of the kind specified in the order.
(4) In this Part—
(a) an order under subsection (1) is referred to as a “revocation order”;
(b) an order under subsection (2) is referred to as a “partial revocation order”.
(5) A revocation order or partial revocation order—
(a) has effect from such date as is specified in the order, and
(b) may make provision for members of the body in question to continue to be treated as fully or partially authorised (as the case may be) to act as insolvency practitioners for a specified period after the order takes effect.
(6) A partial revocation order has effect as if it were an order made under section 391(2).
(1) Before making a revocation order or partial revocation order in relation to a recognised professional body, the Secretary of State must give notice to the body—
(a) stating that the Secretary of State proposes to make the order and the terms of the proposed order,
(b) specifying the Secretary of State's reasons for proposing to make the order, and
(c) specifying a period within which the body, members of the body or other persons likely to be affected by the proposal may make written representations with respect to it.
(2) Where the Secretary of State gives a notice under subsection (1), the Secretary of State must publish the notice on the same day.
(3) The period specified under subsection (1)(c)—
(a) must begin with the date on which the notice is given to the body, and
(b) must not be less than 28 days.
(4) On the expiry of that period, the Secretary of State must decide whether to make the revocation order or (as the case may be) partial revocation order in relation to the body.
(5) The Secretary of State must give notice of the decision to the body.
(6) Where the Secretary of State decides to make the order, the notice under subsection (5) must specify—
(a) when the order is to take effect, and
(b) the Secretary of State's reasons for making the order.
(7) A notice under subsection (5) must be published; and it must (if possible) be published in the same manner as that in which the notice under subsection (1) was published.
(1) An order under section 391(1) or (2) in relation to a recognised professional body may be revoked by the Secretary of State by order if—
(a) the body has requested that an order be made under this subsection, and
(b) the Secretary of State is satisfied that it is appropriate in all the circumstances of the case to revoke the body's recognition under section 391.
(2) An order under section 391(1) in relation to a recognised professional body may be revoked by the Secretary of State by an order which also declares the body concerned to be a recognised professional body which is capable of providing its insolvency specialist members with partial authorisation only of the kind specified in the order (see section 390A(1)) if—
(a) the body has requested that an order be made under this subsection, and
(b) the Secretary of State is satisfied that it is appropriate in all the circumstances of the case for the body to be declared to be a recognised professional body which is capable of providing its insolvency specialist members with partial authorisation only of the kind specified in the order.
(3) Where the Secretary of State decides to make an order under this section the Secretary of State must publish a notice specifying—
(a) when the order is to take effect, and
(b) the Secretary of State's reasons for making the order.
(4) An order under this section—
(a) has effect from such date as is specified in the order, and
(b) may make provision for members of the body in question to continue to be treated as fully or partially authorised (as the case may be) to act as insolvency practitioners for a specified period after the order takes effect.
(5) An order under subsection (2) has effect as if it were an order made under section 391(2).
(1) For the purposes of this Part a “direct sanctions order” is an order made by the court against a person who is acting as an insolvency practitioner which—
(a) declares that the person is no longer authorised (whether fully or partially) to act as an insolvency practitioner;
(b) declares that the person is no longer fully authorised to act as an insolvency practitioner but remains partially authorised to act as such either in relation to companies or individuals, as specified in the order;
(c) declares that the person's authorisation to act as an insolvency practitioner is suspended for the period specified in the order or until such time as the requirements so specified are complied with;
(d) requires the person to comply with such other requirements as may be specified in the order while acting as an insolvency practitioner;
(e) requires the person to make such contribution as may be specified in the order to one or more creditors of a company, individual or insolvent partnership in relation to which the person is acting or has acted as an insolvency practitioner.
(2) Where the court makes a direct sanctions order, the relevant recognised professional body must take all necessary steps to give effect to the order.
(3) A direct sanctions order must not be made against a person whose authorisation to act as an insolvency practitioner was granted by the Department of Enterprise, Trade and Investment in Northern Ireland (see section 390A(2)(b)).
(4) A direct sanctions order must not specify a contribution as mentioned in subsection (1)(e) which is more than the remuneration that the person has received or will receive in respect of acting as an insolvency practitioner in the case.
(5) In this section and section 391P—
“the court” means the High Court or, in Scotland, the Court of Session;
“relevant recognised professional body”, in relation to a person who is acting as an insolvency practitioner, means the recognised professional body by virtue of which the person is authorised so to act.
391P Application for, and power to make, direct sanctions order
(1) The Secretary of State may apply to the court for a direct sanctions order to be made against a person if it appears to the Secretary of State that it would be in the public interest for the order to be made.
(2) The Secretary of State must send a copy of the application to the relevant recognised professional body.
(3) The court may make a direct sanctions order against a person where, on an application under this section, the court is satisfied that condition 1 and at least one of conditions 2, 3, 4 and 5 are met in relation to the person.
(4) The conditions are set out in section 391Q.
(5) In deciding whether to make a direct sanctions order against a person the court must have regard to the extent to which—
(a) the relevant recognised professional body has taken action against the person in respect of the failure mentioned in condition 1, and
(b) that action is sufficient to address the failure.
(1) Condition 1 is that the person, in acting as an insolvency practitioner or in connection with any appointment as such, has failed to comply with—
(a) a requirement imposed by the rules of the relevant recognised professional body;
(b) any standards, or code of ethics, for the insolvency-practitioner profession adopted from time to time by the relevant recognised professional body.
(2) Condition 2 is that the person—
(a) is not a fit and proper person to act as an insolvency practitioner;
(b) is a fit and proper person to act as an insolvency practitioner only in relation to companies, but the person's authorisation is not so limited; or
(c) is a fit and proper person to act as an insolvency practitioner only in relation to individuals, but the person's authorisation is not so limited.
(3) Condition 3 is that it is appropriate for the person's authorisation to act as an insolvency practitioner to be suspended for a period or until one or more requirements are complied with.
(4) Condition 4 is that it is appropriate to impose other restrictions on the person acting as an insolvency practitioner.
(5) Condition 5 is that loss has been suffered as a result of the failure mentioned in condition 1 by one or more creditors of a company, individual or insolvent partnership in relation to which the person is acting or has acted as an insolvency practitioner.
(6) In this section “relevant recognised professional body” has the same meaning as in section 391O.
(1) The Secretary of State may give a direction (a “direct sanctions direction”) in relation to a person acting as an insolvency practitioner to the relevant recognised professional body (instead of applying, or continuing with an application, for a direct sanctions order against the person) if the Secretary of State is satisfied that—
(a) condition 1 and at least one of conditions 2, 3, 4 and 5 are met in relation to the person (see section 391Q), and
(b) it is in the public interest for the direction to be given.
(2) But the Secretary of State may not give a direct sanctions direction in relation to a person without that person's consent.
(3) A direct sanctions direction may require the relevant recognised professional body to take all necessary steps to secure that—
(a) the person is no longer authorised (whether fully or partially) to act as an insolvency practitioner;
(b) the person is no longer fully authorised to act as an insolvency practitioner but remains partially authorised to act as such either in relation to companies or individuals, as specified in the direction;
(c) the person's authorisation to act as an insolvency practitioner is suspended for the period specified in the direction or until such time as the requirements so specified are complied with;
(d) the person must comply with such other requirements as may be specified in the direction while acting as an insolvency practitioner;
(e) the person makes such contribution as may be specified in the direction to one or more creditors of a company, individual or insolvent partnership in relation to which the person is acting or has acted as an insolvency practitioner.
(4) A direct sanctions direction must not be given in relation to a person whose authorisation to act as an insolvency practitioner was granted by the Department of Enterprise, Trade and Investment in Northern Ireland (see section 390A(2)(b)).
(5) A direct sanctions direction must not specify a contribution as mentioned in subsection (3)(e) which is more than the remuneration that the person has received or will receive in respect of acting as an insolvency practitioner in the case.
(6) In this section “relevant recognised professional body” has the same meaning as in section 391O.
391S Power for Secretary of State to obtain information
(1) A person mentioned in subsection (2) must give the Secretary of State such information as the Secretary of State may by notice in writing require for the exercise of the Secretary of State's functions under this Part.
(2) Those persons are—
(a) a recognised professional body;
(b) any individual who is or has been authorised under section 390A to act as an insolvency practitioner;
(c) any person who is connected to such an individual.
(3) A person is connected to an individual who is or has been authorised to act as an insolvency practitioner if, at any time during the authorisation—
(a) the person was an employee of the individual;
(b) the person acted on behalf of the individual in any other way;
(c) the person employed the individual;
(d) the person was a fellow employee of the individual's employer;
(e) in a case where the individual was employed by a firm, partnership or company, the person was a member of the firm or partnership or (as the case may be) a director of the company.
(4) In imposing a requirement under subsection (1) the Secretary of State may specify—
(a) the time period within which the information in question is to be given, and
(b) the manner in which it is to be verified.
(1) If at any time it appears to the Secretary of State that—
(a) a recognised professional body has failed to comply with a requirement imposed on it by or by virtue of this Part, or
(b) any other person has failed to comply with a requirement imposed on the person by virtue of section 391S,
the Secretary of State may make an application to the court.
(2) If, on an application under this section, the court decides that the body or other person has failed to comply with the requirement in question, it may order the body or person to take such steps as the court considers will secure that the requirement is complied with.
(3) In this section, “the court” means the High Court or, in Scotland, the Court of Session.
398A Appointment etc of adjudicators and assistants
(1) The Secretary of State may appoint persons to the office of adjudicator.
(2) A person appointed under subsection (1)—
(a) is to be paid out of money provided by Parliament such salary as the Secretary of State may direct,
(b) holds office on such other terms and conditions as the Secretary of State may direct, and
(c) may be removed from office by a direction of the Secretary of State.
(3) A person who is authorised to act as an official receiver may not be appointed under subsection (1).
(4) The Secretary of State may appoint officers of the Secretary of State's department to assist adjudicators in the carrying out of their functions.
(1) For the purposes of this Act the official receiver, in relation to any bankruptcy , winding up , individual voluntary arrangement, debt relief order or application for such an order, is any person who by virtue of the following provisions of this section or section 401 below is authorised to act as the official receiver in relation to that bankruptcy , winding up , individual voluntary arrangement, debt relief order or application for such an order.
(2) The Secretary of State may (subject to the approval of the Treasury as to numbers) appoint persons to the office of official receiver, and a person appointed to that office (whether under this section or section 70 of the Bankruptcy Act 1914)—
(a) shall be paid out of money provided by Parliament such salary as the Secretary of State may with the concurrence of the Treasury direct,
(b) shall hold office on such other terms and conditions as the Secretary of State may with the concurrence of the Treasury direct, and
(c) may be removed from office by a direction of the Secretary of State.
(3) Where a person holds the office of official receiver, the Secretary of State shall from time to time attach him either to the High Court or to the county court.
(4) Subject to any directions under subsection (6) below, an official receiver attached to a particular court is the person authorised to act as the official receiver in relation to every bankruptcy , winding up , individual voluntary arrangement, debt relief order or application for such an order falling within the jurisdiction of that court.
(5) The Secretary of State shall ensure that there is, at all times, at least one official receiver attached to the High Court and at least one attached to the county court; but he may attach the same official receiver to both courts.
(6) The Secretary of State may give directions with respect to the disposal of the business of official receivers, and such directions may, in particular—
(a) authorise an official receiver attached to one court to act as the official receiver in relation to any case or description of cases falling within the jurisdiction of the other court;
(b) provide, where there is more than one official receiver authorised to act as the official receiver in relation to cases falling within the jurisdiction of any court, for the distribution of their business between or among themselves.
(7) A person who at the coming into force of section 222 of the Insolvency Act 1985 (replaced by this section) is an official receiver attached to a court shall continue in office after the coming into force of that section as an official receiver attached to that court under this section.
(1) In addition to any functions conferred on him by this Act, a person holding the office of official receiver shall carry out such other functions as may from time to time be conferred on him by the Secretary of State.
(2) In the exercise of the functions of his office a person holding the office of official receiver shall act under the general directions of the Secretary of State and shall also be an officer of the court in relation to which he exercises those functions.
(3) Any property vested in his official capacity in a person holding the office of official receiver shall, on his dying, ceasing to hold office or being otherwise succeeded in relation to the bankruptcy or winding up in question by another official receiver, vest in his successor without any conveyance, assignment or transfer.
(1) The Secretary of State may, if he thinks it expedient to do so in order to facilitate the disposal of the business of the official receiver attached to any court, appoint an officer of his department to act as deputy to that official receiver.
(2) Subject to any directions given by the Secretary of State under section 399 or 400, a person appointed to act as deputy to an official receiver has, on such conditions and for such period as may be specified in the terms of his appointment, the same status and functions as the official receiver to whom he is appointed deputy.
Accordingly, references in this Act (except section 399(1) to (5)) to an official receiver include a person appointed to act as his deputy.
(3) An appointment made under subsection (1) may be terminated at any time by the Secretary of State.
(4) The Secretary of State may, subject to the approval of the Treasury as to numbers and remuneration and as to the other terms and conditions of the appointments, appoint officers of his department to assist official receivers in the carrying out of their functions.
(1) There continues to be an officer known as the Official Petitioner for the purposes of discharging, in relation to cases in which a criminal bankruptcy order is made, the functions assigned to him by or under this Act; and the Director of Public Prosecutions continues, by virtue of his office, to be the Official Petitioner.
(2) The functions of the Official Petitioner include the following—
(a) to consider whether, in a case in which a criminal bankruptcy order is made, it is in the public interest that he should himself present a petition under section 264(1)(d) of this Act;
(b) to present such a petition in any case where he determines that it is in the public interest for him to do so;
(c) to make payments, in such cases as he may determine, towards expenses incurred by other persons in connection with proceedings in pursuance of such a petition; and
(d) to exercise, so far as he considers it in the public interest to do so, any of the powers conferred on him by or under this Act.
(3) Any functions of the Official Petitioner may be discharged on his behalf by any person acting with his authority.
(4) Neither the Official Petitioner nor any person acting with his authority is liable to any action or proceeding in respect of anything done or omitted to be done in the discharge, or purported discharge, of the functions of the Official Petitioner.
(5) In this section “criminal bankruptcy order” means an order under section 39(1) of the Powers of Criminal Courts Act 1973.
(1) All money received by the Secretary of State in respect of proceedings under this Act as it applies to England and Wales shall be paid into the Insolvency Services Account kept by the Secretary of State with the Bank of England; and all payments out of money standing to the credit of the Secretary of State in that account shall be made by the Bank of England in such manner as he may direct.
(2) Whenever the cash balance standing to the credit of the Insolvency Services Account is in excess of the amount which in the opinion of the Secretary of State is required for the time being to answer demands in respect of bankrupts’ estates or companies’ estates, the Secretary of State shall—
(a) notify the excess to the National Debt Commissioners, and
(b) pay into the Insolvency Services Investment Account (“the Investment Account”) kept by the Commissioners with the Bank of England the whole or any part of the excess as the Commissioners may require for investment in accordance with the following provisions of this Part.
(3) Whenever any part of the money so invested is, in the opinion of the Secrtetary of State, required to answer any demand in respect of bankrupt’s estates or companies’ estates, he shall notify to the National Debt Commissioners the amount so required and the Commissioners—
(a) shall thereupon repay to the Secretary of State such sum as may be required to the credit of the Insolvency Services Account, and
(b) for that purpose may direct the sale of such part of the securities in which the money has been invested as may be necessary.
Any money standing to the credit of the Investment Account (including any money received by the National Debt Commissioners by way of interest on or proceeds of any investment under this section) may be invested by the Commissioners, in accordance with such directions as may be given by the Treasury, in any manner for the time being specified in Part II of Schedule 1 to the Trustee Investments Act 1961.
406 Interest on money received by liquidators or trustees in bankruptcy and invested.
Where under rules made by virtue of paragraph 16 of Schedule 8 to this Act(investment of money received by company liquidators) or paragraph 21 of Schedule 9 to this Act (investment of money received by trustee in bankruptcy) a company or a bankrupt’s estate has become entitled to any sum by way of interest, the Secretary of State shall certify that sum and the amount of tax payable on it to the National Debt Commissioners; and the Commissioners shall pay, out of the Investment Account—
(a) into the Insolvency Services Account, the sum so certified less the amount of tax so certified, and
(b) to the Commissioners of Inland Revenue, the amount of tax so certified.
407 Unclaimed dividends and undistributed balances.
(1) The Secretary of State shall from time to time pay into the Consolidated Fund out of the Insolvency Services Account so much of the sums standing to the credit of that Account as represents—
(a) dividends which were declared before such date as the Treasury may from time to time determine and have not been claimed, and
(b) balances ascertained before that date which are too small to be divided among the persons entitled to them.
(2) For the purposes of this section the sums standing to the credit of the Insolvency Services Account are deemed to include any sums paid out of that Account and represented by any sums or securities standing to the credit of the Investment Account.
(3) The Secretary of State may require the National Debt Commissioners to pay out of the Investment Account into the Insolvency Services Account the whole or part of any sum which he is required to pay out of that account under subsection (1); and the Commissioners may direct the sale of such securities standing to the credit of the Investment Account as may be necessary for that purpose.
(1) The Treasury may direct the payment out of the Consolidated Fund of sums into—
(a) the Insolvency Services Account;
(b) the Investment Account.
(2) The Treasury shall certify to the House of Commons the reason for any payment under subsection (1).
(3) The Secretary of State may pay sums out of the Insolvency Services Account into the Consolidated Fund.
(4) The National Debt Commissioners may pay sums out of the Investment Account into the Consolidated Fund.
(1) The National Debt Commissioners shall for each year ending on 31st March prepare a statement of the sums credited and debited to the Investment Account in such form and manner as the Treasury may direct and shall transmit it to the Comptroller and Auditor General before the end of November next following the year.
(2) The Secretary of State shall for each year ending 31st March prepare a statement of the sums received or paid by him under section 403 above in such form and manner as the Treasury may direct and shall transmit each statement to the Comptroller and Auditor General before the end of November next following the year.
(3) Every such statement shall include such additional information as the Treasury may direct.
(4) The Comptroller and Auditor General shall examine, certify and report on every such statement and shall lay copies of it, and of his report, before Parliament.
(1) Rules may be made—
(a) in relation to England and Wales, by the Lord Chancellor with the concurrence of the Secretary of State and, in the case of rules that affect court procedure, with the concurrence of the Lord Chief Justice, or
(b) in relation to Scotland, by the Secretary of State,
for the purpose of giving effect to Parts A1 to VII of this Act or the EU Regulation.
(1A) Rules may also be made for the purpose of giving effect to Part 2 of the Banking Act 2009 (bank insolvency orders); and rules for that purpose shall be made—
(a) in relation to England and Wales, by the Lord Chancellor with the concurrence of—
(i) the Treasury, and
(ii) in the case of rules that affect court procedure, the Lord Chief Justice, or
(b) in relation to Scotland, by the Treasury.
(1B) Rules may also be made for the purpose of giving effect to Part 3 of the Banking Act 2009 (bank administration); and rules for that purpose shall be made—
(a) in relation to England and Wales, by the Lord Chancellor with the concurrence of—
(i) the Treasury, and
(ii) in the case of rules that affect court procedure, the Lord Chief Justice, or
(b) in relation to Scotland, by the Treasury.
(2) Without prejudice to the generality of subsection (1), (1A) or (1B) or to any provision of those Parts by virtue of which rules under this section may be made with respect to any matter, rules under this section may contain—
(a) any such provision as is specified in Schedule 8 to this Act or corresponds to provision contained immediately before the coming into force of section 106 of the Insolvency Act 1985 in rules made, or having effect as if made, under section 663(1) or (2) of the the Companies Act 1985 (old winding-up rules), and
(b) such incidental, supplemental and transitional provisions as may appear to the Lord Chancellor or, as the case may be, the Secretary of State or the Treasury necessary or expedient.
(2A) For the purposes of subsection (2), a reference in Schedule 8 to this Act to doing anything under or for the purposes of a provision of this Act includes a reference to doing anything under or for the purposes of the EU Regulation (in so far as the provision of this Act relates to a matter to which the EU Regulation applies).
(2B) Rules under this section for the purpose of giving effect to the EU Regulation may not create a new relevant offence.
(2C) For the purposes of subsection (2), a reference in Schedule 8 to this Act to doing anything under or for the purposes of a provision of this Act includes a reference to doing anything under or for the purposes of Part 2 of the Banking Act 2009.
(2D) For the purposes of subsection (2), a reference in Schedule 8 to this Act to doing anything under or for the purposes of a provision of this Act includes a reference to doing anything under or for the purposes of Part 3 of the Banking Act 2009.
(3) In Schedule 8 to this Act “liquidator” includes a provisional liquidator or bank liquidator or administrator; and references above in this section to Parts A1 to VII of this Act or Part 2 or 3 of the Banking Act 2009 are to be read as including the Companies Acts so far as relating to, and to matters connected with or arising out of, the insolvency or winding up of companies.
(3A) In this section references to Part 2 or 3 of the Banking Act 2009 include references to those Parts as applied to building societies (see section 90C of the Building Societies Act 1986).
(4) Rules under this section shall be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.
(5) Regulations made by the Secretary of State or the Treasury under a power conferred by rules under this section shall be made by statutory instrument and, after being made, shall be laid before each House of Parliament.
(6) Nothing in this section prejudices any power to make rules of court.
(7) The Lord Chief Justice may nominate a judicial office holder (as defined in section 109(4) of the Constitutional Reform Act 2005) to exercise his functions under this section.
412 Individual insolvency rules (England and Wales).
(1) The Lord Chancellor may, with the concurrence of the Secretary of State and, in the case of rules that affect court procedure, with the concurrence of the Lord Chief Justice, make rules for the purpose of giving effect to Parts 7A to 11 of this Act or the EU Regulation .
(2) Without prejudice to the generality of subsection (1), or to any provision of those Parts by virtue of which rules under this section may be made with respect to any matter, rules under this section may contain—
(a) any such provision as is specified in Schedule 9 to this Act or corresponds to provision contained immediately before the appointed day in rules made under section 132 of the Bankruptcy Act 1914; and
(b) such incidental, supplemental and transitional provisions as may appear to the Lord Chancellor necessary or expedient.
(2A) For the purposes of subsection (2), a reference in Schedule 9 to this Act to doing anything under or for the purposes of a provision of this Act includes a reference to doing anything under or for the purposes of the EU Regulation (in so far as the provision of this Act relates to a matter to which the EU Regulation applies).
(2B) Rules under this section for the purpose of giving effect to the EU Regulation may not create a new relevant offence.
(3) Rules under this section shall be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.
(4) Regulations made by the Secretary of State under a power conferred by rules under this section shall be made by statutory instrument and, after being made, shall be laid before each House of Parliament.
(5) Nothing in this section prejudices any power to make rules of court.
(6) The Lord Chief Justice may nominate a judicial office holder (as defined in section 109(4) of the Constitutional Reform Act 2005) to exercise his functions under this section.
(1) The committee established under section 10 of the Insolvency Act 1976 (advisory committee on bankruptcy and winding-up rules) continues to exist for the purpose of being consulted under this section.
(2) The Lord Chancellor shall consult the committee before making any rules under section 411 or 412 other than rules which contain a statement that the only provision made by the rules is provision applying rules made under section 411, with or without modifications, for the purposes of provision made by section any of sections 23 to 26 of the Water Industry Act 1991 or Schedule 3 to that Act or by any of sections 59 to 65 of, or Schedule 6 or 7 to, the Railways Act 1993..
(3) Subject to the next subsection, the committee shall consist of—
(a) a judge of the High Court attached to the Business and Property Division;
(b) a circuit judge;
(c) an insolvency and companies court judge;
(d) a district judge;
(e) a practising barrister;
(f) a practising solictor; and
(g) a practising accountant;
and the appointment of any person as a member of the committee shall be made in accordance with subsection (3A) or (3B).
(3A) The Lord Chief Justice must appoint the persons referred to in paragraphs (a) to (d) of subsection (3), after consulting the Lord Chancellor.
(3B) The Lord Chancellor must appoint the persons referred to in paragraphs (e) to (g) of subsection (3), after consulting the Lord Chief Justice.
(4) The Lord Chancellor may appoint as additional members of the committee any persons appearing to him to have qualifications or experience that would be of value to the committee in considering any matter with which it is concerned.
(5) The Lord Chief Justice may nominate a judicial office holder (as defined in section 109(4) of the Constitutional Reform Act 2005) to exercise his functions under this section.
(1) There shall be paid in respect of—
(a) proceedings under any of Parts A1 to VII of this Act, and
(b) the performance by the official receiver or the Secretary of State of functions under those Parts,
such fees as the competent authority may with the sanction of the Treasury by order direct.
(2) That authority is—
(a) in relation to England and Wales, the Lord Chancellor, and
(b) in relation to Scotland, the Secretary of State.
(3) The Treasury may by order direct by whom and in what manner the fees are to be collected and accounted for.
(4) The Lord Chancellor may, with the sanction of the Treasury, by order provide for sums to be deposited, by such persons, in such manner and in such circumstances as may be specified in the order, by way of security for fees payable by virtue of this section.
(5) An order under this section may contain such incidental, supplemental and transitional provisions as may appear to the Lord Chancellor, the Secretary of State or (as the case may be) the Treasury necessary or expedient.
(6) An order under this section shall be made by statutory instrument and, after being made, shall be laid before each House of Parliament.
(7) Fees payable by virtue of this section shall be paid into the Consolidated Fund.
(8) References in subsection (1) to Parts A1 to VII of this Act are to be read as including the Companies Acts so far as relating to, and to matters connected with or arising out of, the insolvency or winding up of companies.
(8A) This section applies in relation to Part 2 of the Banking Act 2009 (bank insolvency) as in relation to Parts I to VII of this Act.
(8B) This section applies in relation to Part 3 of the Banking Act 2009 (bank administration) as in relation to Parts I to VII of this Act.
(8C) In subsections (8A) and (8B) the reference to Parts 2 and 3 of the Banking Act 2009 include references to those Parts as applied to building societies (see section 90C of the Building Societies Act 1986).
(9) Nothing in this section prejudices any power to make rules of court; and the application of this section to Scotland is without prejudice to section 2 of the Courts of Law Fees (Scotland) Act 1895.