With immediate effect, the HMRC address for submission of VAT 426 claims has been changed to the address below.
HM Revenue and Customs
Birmingham DRT
VAT 426 Processing only
DMB490
BX5 5AB
Any VAT 426 claims that have been sent to the old Woolwich address will be redirected to the Birmingham office.
Steps have been taken to update the address on the VAT 426 form itself and the Insolvency VAT Public Notice 700/56 will be updated with the new address in due course.
The Money Laundering Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR17)
The Statutory Instrument came into force 26 June 2017. Whilst the Government consulted on the proposed draft Regulations earlier this year little notice was given of the final versions of this regulation and initial reviews against the draft regulations indicate that there have been a number of last minute material changes.
The new Regulations are very detailed, firms will be required to take a more risk based approach and the automatic application of simplified due diligence has been removed. R3 is currently reviewing the key changes with a view to providing guidance for our members on the implications of those changes for insolvency practitioners.
The Insolvency Amendment (EU 2015/848) Regulations 2017
The EU Regulation 2015/848 (the recast Regulation) came into force, in part, on 26 June 2017. Whilst the recast Regulation has direct effect in the UK, the Insolvency Amendment (EU 2015/848) Regulations 2017 was made to facilitate the operation of the recast Regulation, amending the Insolvency Act 1986, the Insolvency (England and Wales) Rules 2016, the Insolvency (Northern Ireland) Order 1989, the Insolvency Rules (Northern Ireland) 1991 and the Insolvency (Scotland) Rules 1986 to make them compatible with the Recast Regulation.
The Regulations make new provision for deferring dissolution of a company registered in England, Wales, Scotland or Northern Ireland where there are concurrent insolvency proceedings in another member State. A number of standard forms have been created for use across all Member States. It also makes provision for two new procedures in the EIR:
- The approval of an undertaking in lieu of secondary insolvency proceedings
- The appointment of a co-ordinator where companies in a group are subject to insolvency proceedings.
An overview of the main changes are outlined in the Recovery Summer 2017 Edition article ‘The power of the collective: EIR in focus’ and detailed guidance on the implications for insolvency practitioners will be provided to members in due course.
The General Data Protection Regulation (Regulation (EU) 2016/679) (‘GDPR’)
The GDPR will apply in the UK from 25 May 2018 and it will not be affected by the UK’s decision to leave the EU. The GDPR will apply to all persons and organisations which control or process personal data, using both automated and manual filing systems where personal data are accessible according to specific criteria. A two year transitional period started in 2016 and therefore all organisations will be expected to be compliant with the GDPR when it comes into force.
Whilst the GDPR brings in many changes, much of it reinforces and clarifies obligations that already exist under the Data Protection Act 1998 (‘DPA 1998’). The Data Protection Act 1998 principles are consolidated and a new accountability principle has been added whereby organisations will be required to be able to demonstrate compliance with the principles. The threshold for consent is much higher under the GDPR than under the DPA 1998.
R3 is currently reviewing the changes introduced by the GDPR and will roll out written guidance and seminars, as appropriate, on the key impact for insolvency practitioners in due course.
The application of the Insolvency (England and Wales) Rules 2016 to voluntary arrangements agreed using the R3 Standard Conditions prior to and post
6 April 2017
We have received a number of queries from members concerned as to the applicability of the new Insolvency Rules to voluntary arrangements entered into prior to 6 April 2017 which use the R3 Standard Conditions. The Insolvency Service provided a view in Dear IP 76, issued April 2017, on the applicability of the new Rules to voluntary arrangements using the IVA Protocol. In this situation they are of the opinion that reference to ‘the Rules as amended’ includes a new set of Rules repealing and replacing the 1986 Rules. It would follow from this that variation meetings to amend references to the 1986 Rules is not required. They further advised that they considered that supervisors should not feel restricted to only using physical meetings to obtain decisions from creditors and expected supervisors to take advantage of the new and varied decision making procedures that are available under the Act as amended and the 2016 Rules.
The R3 Standard Conditions also make reference to the ‘Insolvency Act 1986 as amended’ and the ‘Insolvency Rules 1986 as amended’. An IVA is analogous to a contract and it could be said that all the references to the Rules introduced to make it work can still be applied. Concern has been expressed that in terms of variations, where the Act and Rules are silent, the terms of the arrangement would apply. The current R3 Standard Conditions refer to ‘meetings of creditors’ rather than making specific reference to the Rules. R3 is also of the opinion that IPs are not restricted to using physical meetings of creditors only when seeking the views of creditors and that the full range of decision making procedures introduced by the new Rules are available to the supervisor. It could also be argued that section 379ZA of the Act which prevents physical meetings being held except in limited, defined circumstances, applies to existing arrangements.
The R3 Standard Conditions are currently being reviewed and updated in light of the changes introduced by the new Rules and the recent judgement in Green v Wright. We are of the opinion that the current version of the Standard Conditions continues to be relevant and supervisors using the current version of the Standard Conditions for arrangements approved post 6 April 2017 should apply the new Rules when seeking decisions of creditors. For the avoidance of doubt however nominees may wish to seek their own legal advice on the wording to be used when seeking variations of the arrangement and supervisors may wish to seek their own legal advice on the procedures to be followed for decisions of creditors to be taken on arrangements approved before the introduction of the new Rules.
The views expressed above are those of R3. They are not statements of law and are not binding on any creditors, debtors or the courts. You should seek independent legal advice on the facts of your particular case if you require advice you/the estate can rely upon.