PART IXBANKRUPTCY

CHAPTER VEFFECT OF BANKRUPTCY ON CERTAIN RIGHTS, TRANSACTIONS, ETC.

Adjustment of prior transactions, etc.

Orders under Article 312 or 313 in respect of pension-sharing transactions315E. F1

(1)

This Article and Article 315F apply if the High Court is making an order under Article 312 or 313 in a case where—

(a)

the transaction or preference is, or is any part of, a pension-sharing transaction, and

(b)

the transferee has rights under a pension arrangement ( “the destination arrangement”, which maybe the shared arrangement or any other pension arrangement) that are derived, directly or indirectly, from the pension-sharing transaction.

(2)

Without prejudice to the generality of Article 312(2) or 313(2), or of Article 315, the order may include provision—

(a)

requiring the person responsible for the destination arrangement to pay an amount to the transferor's trustee in bankruptcy,

(b)

adjusting the liabilities of the destination arrangement in respect of the transferee,

(c)

adjusting any liabilities of the destination arrangement in respect of any other person that derive, directly or indirectly, from rights of the transferee under the destination arrangement,

(d)

for the recovery by the person responsible for the destination arrangement (whether by deduction from any amount which that person is ordered to pay or otherwise) of costs incurred by that person in complying in the transferor's case with any requirement under Article 315F(1) or in giving effect to the order,

(e)

for the recovery, from the transferor's trustee in bankruptcy, by the person responsible for a pension arrangement, of costs incurred by that person in complying in the transferor's case with any requirement under Article 315F(2) or (3).

(3)

In paragraph (2), references to adjusting the liabilities of the destination arrangement in respect of a person include (in particular) reducing the amount of any benefit or future benefit to which that person is entitled under the arrangement.

(4)

The maximum amount which the person responsible for the destination arrangement may be required to pay by the order is the smallest of—

(a)

so much of the appropriate amount as, in accordance with Article 315D is recoverable,

(b)

so much (if any) of the amount of the unfair contributions (within the meaning given by Article 315D(5)) as is not recoverable by way of an order under Article 315A containing provision such as is mentioned in Article 315B(1)(a), and

(c)

the value of the transferee's rights under the destination arrangement so far as they are derived, directly or indirectly, from the pension-sharing transaction.

(5)

If the order requires the person responsible for the destination arrangement to pay an amount ( “the restoration amount”) to the transferor's trustee in bankruptcy it must provide for the liabilities of the arrangement to be correspondingly reduced.

(6)

For the purposes of paragraph (5), liabilities are correspondingly reduced if the difference between—

(a)

the amount of the liabilities immediately before the reduction, and

(b)

the amount of the liabilities immediately after the reduction,

is equal to the restoration amount.

(7)

The order—

(a)

shall be binding on the person responsible for the destination arrangement, and

(b)

overrides provisions of the destination arrangement to the extent that they conflict with the provisions of the order.