The Financial Assistance Scheme Regulations 2005

Insolvency events U.K.

13.—(1) “ Insolvency event” shall, for the purposes of regulations 11 and 12, be interpreted in accordance with—

(a) section 121(2) to (4) (other than subsection (3)(f) of that section); or

(b) Article 105(2) to (4) and (12) (other than paragraph (3)(f) of that Article),

and the following provisions of this regulation.

(2) Where the employer in relation to an occupational pension scheme is a person specified in paragraph (3), an insolvency event shall be treated as having occurred in relation to that employer for the purposes of regulations 11 and 12 where the scheme manager is satisfied that—

(a) that employer was unlikely to continue as a going concern; and

F1 (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) The persons specified in this paragraph are—

(a) a public body—

(i) in relation to which it is not possible for an insolvency event within the meaning of section 121 or Article 105 to occur; and

(ii) which is not the employer in relation to an occupational pension scheme in respect of which a relevant public authority has either—

(aa) given a guarantee in relation to any part of the scheme, any benefits payable under the scheme or any member of the scheme; or

(bb) made any other arrangements for the purposes of securing that the assets of the scheme are sufficient to meet any part of its liabilities;

(b) a charity (as construed in accordance with the Charities Act 1993 M1 or the Charities Act (Northern Ireland) 1964 M2 ) which is not a company or other body corporate; or

(c) a trade union within the meaning given in section 1 of the Trade Union and Labour Relations (Consolidation) Act 1992 M3 or in Article 3(1) of the Industrial Relations (Northern Ireland) Order 1992 M4 in relation to which it is not possible for an insolvency event within the meaning of section 121 or Article 105 to occur.

[F2 (3A) Where the scheme manager is satisfied that the employer in relation to an occupational pension scheme is unlikely to continue as a going concern, the scheme manager may treat an insolvency event as having occurred in relation to that employer for the purposes of regulations 11 and 12 where he is satisfied that F3 ... all of the following circumstances applied to that employer—

(a) no insolvency event referred to elsewhere in this regulation has occurred or is likely to occur in relation to the employer;

(b) the value of the assets of the employer is less than the amount of its liabilities, taking into account its contingent and prospective liabilities; and

(c) the employer is unable to pay its debts as they fall due or have fallen due.]

(4) An insolvency event also occurs for the purposes of regulations 11 and 12 where any of the following events occur F4 ...—

(a) in relation to a company—

(i) where an administration order is made—

(aa) by the court in relation to the company under, or by virtue of any enactment which applies, Part 2 of the 1986 Act (administration orders) (with or without modification); or

(bb) by the High Court in relation to the company under, or by virtue of any statutory provision which applies, Part 3 of the Insolvency (Northern Ireland) Order (administration orders) (with or without modification);

(ii) where a resolution is passed for a voluntary winding up of the company with a declaration of solvency under section 89 of the 1986 Act or under Article 75 of the Insolvency (Northern Ireland) Order; or

(iii) where notice is published in the Gazette that the company has been struck off the register pursuant to section 652 or 652A of the Companies Act 1985 M5 or Article 603 or 603A of the Companies (Northern Ireland) Order 1986M6 ;

(b) in relation to a relevant body, where—

(i) any of the events referred to—

(aa) in section 121(3) occurs in relation to that body by virtue of the application (with or without modification) of any provision of the 1986 Act or by or under any other enactment; or

(bb) in Article 105(3) M7 (insolvency events) occurs in relation to that body by virtue of the application (with or without modification) of any provision of the Insolvency (Northern Ireland) Order or by or under any other statutory provision; or

(ii) an administration order is made by the court in respect of the relevant body by virtue of any enactment which applies Part 2 of the 1986 Act or Part 3 of the Insolvency (Northern Ireland) Order (with or without modification);

(c) in relation to a limited liability partnership, where notice has been published in the Gazette that the partnership has been struck off the register pursuant to section 652 or 652A of the Companies Act 1985 M8 or Article 603 or 603A of the Companies (Northern Ireland) Order 1986M9 ;

(d) in relation to a building society, where there is dissolution by consent of the members under section 87 of the Building Societies Act 1986 M10 (dissolution by consent);

(e) in relation to a friendly society, where there is dissolution by consent of the members under section 20 of the Friendly Societies Act 1992 M11 (dissolution by consent); and

(f) in relation to an industrial and provident society, where there is dissolution by consent of the members under section 58 of the Industrial and Provident Societies Act 1965 M12 or section 67 of the Industrial and Provident Societies Act (Northern Ireland) 1969 M13 (instrument of dissolution).

[F5 (4A) An insolvency event also occurs for the purposes of regulations 11 and 12 where the scheme manager is satisfied that F4 ...—

(a) an event has occurred in any jurisdiction outside the United Kingdom, in relation to an employer, that substantially corresponds to any event referred to in—

(i) section 121(2) to (4) (other than subsection (3)(f) of that section),

(ii) Article 105(2) to (4) and (12) (other than paragraph (3)(f) of that Article), and

(iii) paragraph (4) of this regulation; and

(b) that employer is unlikely to continue as a going concern.]

[F6 (4B) The scheme manager may also, for the purposes of regulations 11 and 12, treat an insolvency event as having occurred in relation to the employer in relation to an occupational pension scheme where—

(a) the trustees of such a scheme entered into a binding agreement, with the employer against whom it arose, to compromise the debt that arose under section 75 of the 1995 Act, and

(b) the scheme manager is satisfied that had that agreement not been entered into—

(i) the value of that employer’s assets would have been less than the amount of its liabilities, taking into account its contingent and prospective liabilities, or

(ii) the employer would have been unable to pay its debts as they fell due.]

(5) In this regulation, a reference to Part 2 of the 1986 Act (administration orders) shall, in so far as it relates to a company or society listed in section 249(1) of the Enterprise Act 2002 M14 (special administration regimes), have effect as if it referred to Part 2 of the 1986 Act as it had effect immediately before the coming into force of section 248 of the Enterprise Act 2002 (replacement of Part 2 of the 1986 Act).

(6) In this regulation—

“the 1986 Act” means the Insolvency Act 1986 M15 ;

“the Insolvency (Northern Ireland) Order” means the Insolvency (Northern Ireland) Order 1989 M16 ;

“administration order” means an order whereby the management of the company or relevant body, as the case may be, is placed in the hands of a person appointed by the court or, in Northern Ireland, by the High Court;

[F7 “employer” includes a person who is a principal employer for the purposes of regulation 12;]

“the Gazette” means, in respect of companies or limited liability partnerships registered—

(a)

in England and Wales, the London Gazette;

(b)

in Scotland, the Edinburgh Gazette; or

(c)

in Northern Ireland, the Belfast Gazette;

“public body” means a government department or any non-departmental public body established by—

(a)

in relation to Great Britain, an Act of Parliament or by a statutory instrument made under an Act of Parliament to perform functions conferred on it under, or by virtue of, that Act or instrument or any other Act or instrument;

(b)

in relation to Northern Ireland, a statutory provision to perform functions conferred on it under that statutory provision or any other such statutory provision;

“relevant body” means—

(a)

a credit union within the meaning given in section 31(1) of the Credit Unions Act 1979 M17 or Article 2(2) of the Credit Unions (Northern Ireland) Order 1985 M18 (interpretation);

(b)

a limited liability partnership within the meaning given in section 57(6) or Article 53(6) (partnerships and limited liability partnerships);

(c)

a building society within the meaning given in section 119 of the Building Societies Act 1986 (interpretation);

(d)

a person who has permission to act under Part 4 of the FSMA (permission to carry out regulated activities);

(e)

the society of Lloyd's and Lloyd's members who have permission under Part 19 of the FSMA (Lloyd's);

(f)

a friendly society within the meaning given in the Friendly Societies Act 1992; or

(g)

a society which is registered as an industrial and provident society under the Industrial and Provident Societies Act 1965 or under the Industrial and Provident Societies Act (Northern Ireland) 1969;

“statutory provision” has the meaning given in section 1(f) of the Interpretation Act (Northern Ireland) 1954 M19 .

Textual Amendments

F1 Reg. 13(2)(b) omitted (19.12.2007) by virtue of The Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2007 (S.I. 2007/3581), regs. 1(1), 4(5)(a)

F2 Reg. 13(3A) inserted (16.12.2006) by The Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2006 (S.I. 2006/3370), regs. 1(1), 4(4)

F3 Words in reg. 13(3A) omitted (19.12.2007) by virtue of The Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2007 (S.I. 2007/3581), regs. 1(1), 4(5)(b)

F4 Words in reg. 13(4)(4A) omitted (19.12.2007) by virtue of The Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2007 (S.I. 2007/3581), regs. 1(1), 4(4)

F5 Reg. 13(4A) inserted (16.12.2006) by The Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2006 (S.I. 2006/3370), regs. 1(1), 4(5)

F6 Reg. 13(4B) inserted (19.12.2007) by The Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2007 (S.I. 2007/3581), regs. 1(1), 4(5)(c)

F7 Words in reg. 13(6) inserted (16.12.2006) by The Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2006 (S.I. 2006/3370), regs. 1(1), 4(6)

Marginal Citations

M1 1993 c. 10.

M2 1964 c. 33 (N.I.).

M3 1992 c. 52.

M4 S.I.1992/807 (N.I.5).

M5 1985 c. 6. Section 652A is inserted by the Deregulation and Contracting Out Act 1994 (c. 40), section 13(1) and Schedule 5, paragraph 2.

M6 S.I.1986/1032 (N.I.6). Article 603A is inserted by the Deregulation and Contracting Out Act 1994, section 13(2) and Schedule 6, paragraph 2.

M7 See also Article 105(12).

M8 Sections 652 and 652A are applied to limited liability partnerships by the Limited Liability Partnerships Regulations 2001 (S.I.2001/1090).

M9 Articles 603 and 603A are applied to limited liability partnerships by the Limited Liability Partnerships Regulations (Northern Ireland) 2004 (S.R.2004/307).

M10 1986 c. 53.

M11 1992 c. 40.

M12 1965 c. 12.

M13 1969 c. 24 (N.I.).

M14 2002 c. 40.

M15 1986 c. 45.

M16 S.I.1989/2405 (N.I.19).

M17 1979 c. 34.

M18 S.I.1985/1205 (N.I.12).

M19 1954 c. 33 (N.I.). Section 1(f) is amended by the Northern Ireland (Modification of Enactments No.1) Order 1999 (S.I.1999/663), Article 2(1) and Schedule 1, paragraph 9(1).