C1PART XIPREFERENTIAL F20AND NON-PREFERENTIAL DEBTS IN COMPANY AND INDIVIDUAL INSOLVENCY

Annotations:
Amendments (Textual)
Modifications etc. (not altering text)

Categories of preferential debts346

1 F1

A reference in this Order to the preferential debts of a company or an individual is to the debts listed in Schedule 4F2 (contributions to occupational pension schemes; remuneration, &c. of employees; levies on coal and steel production F15; debts owed to the Financial Services Compensation SchemeF13; deposits covered by the Financial Services Compensation Scheme; other deposits); and references to preferential creditors are to be read accordingly.

F141A

A reference in this Order to the “ordinary preferential debts” of a company or an individual is to the preferential debts listed in any of paragraphs 8 to 18 of Schedule 4 to this Order.

1B

A reference in this Order to the “secondary preferential debts” of a company or an individual is to the preferential debts listed in paragraphs 19 or 20 of Schedule 4 to this Order.

2 F1

In Schedule 4 “the debtor” means the company or the individual concerned.

3

Schedule 4 is to be read with Schedule 4 to the Social Security Pensions (Northern Ireland) Order 1975F3 (occupational pension scheme contributions).

“The relevant date”347

1

This Article explains references in Schedule 4 to the relevant date (being the date which determines the existence and amount of a preferential debt).

2

For the purposes of Article 17 (meetings to consider company voluntary arrangement), the relevant date in relation to a company which is not being wound up is—

F4a

if the company is in administration, the date on which it entered administration, and

b

if the company is not in administration, the date on which the voluntary arrangement takes effect.

F52A

For the purposes of paragraph 41 of Schedule A1 (meetings to consider company voluntary arrangement where a moratorium under Article 14A is in force), the relevant date in relation to a company is the date of filing.

3

In relation to a company which is being wound up, the following applies—

a

if the winding up is by the High Court, and the winding‐up order was made immediately upon the discharge of an administration order, the relevant date isF6the date on which the company entered administration;

F7aa

if the winding up is by the Court and the winding-up order was made following conversion of administration into winding up by virtue of F17Article 51 of the EU Regulation, the relevant date isF6the date on which the company entered administration;

ab F8

if the company is deemed to have passed a resolution for voluntary winding up by virtue of an order following conversion of administration into winding up under F18Article 51 of the EU Regulation, the relevant date isF6the date on which the company entered administration;

b

if the case does not fall within sub‐paragraph (a)F7, (aa) or (ab) and the company—

i

is being wound up by the Court, and

ii

had not commenced to be wound up voluntarily before the date of the making of the winding‐up order,

the relevant date is the date of the appointment (or first appointment) of a provisional liquidator or, if no such appointment has been made, the date of the winding‐up order;

F9ba

if the case does not fall within sub-paragraph (a), (aa), (ab) or (b) and the company is being wound up following administration pursuant to paragraph 84 of Schedule B1, the relevant date is the date on which the company entered administration;

c F8

if the case does not fall withinF10 sub-paragraph (a), (aa), (ab), (b) or (ba), the relevant date is the date of the passing of the resolution for the winding up of the company.

F113A

In relation to a company which is in administration (and to which no other provision of this Article applies) the relevant date is the date on which the company enters administration.

4

In relation to a company in receivership (where Article 50 applies), the relevant date is the date of the appointment of the receiver by debenture‐holders.

5 F8

For the purposes of Article 232 (meeting to consider individual voluntary arrangements), the relevant date is, in relation to a debtor who is not an undischarged bankrupt

F12a

where an interim order has been made under Article 226 with respect to his proposal, the date of that order, and

b

in any other case, the date on which the voluntary arrangement takes effect.

6 F8

In relation to a bankrupt, the following applies—

a

where at the time the bankruptcy order was made there was an interim receiver appointed under Article 259, the relevant date is the date on which the interim receiver was first appointed after the presentation of the bankruptcy petition;

b

otherwise, the relevant date is the date of the making of the bankruptcy order.

F167

Nothing in this Article affects the definition of “the relevant date” in Article 5(1A).

F19Financial institutions and their non-preferential debts347A

1

In this Order “relevant financial institution” means any of the following—

a

a credit institution,

b

an investment firm,

c

a financial holding company,

d

a mixed financial holding company.

e

a financial institution which is—

i

a subsidiary of an entity referred to in sub-paragraphs (a) to (d), and

ii

covered by the supervision of that entity on a consolidated basis in accordance with Articles 6 to 17 of Regulation (EU) No 575/2013, or

f

a mixed-activity holding company.

2

The definitions in Article 4 of Regulation (EU) No. 575/2013 apply for the purposes of paragraph (1).

3

In this Order, in relation to a relevant financial institution—

a

“ordinary non-preferential debts” means non-preferential debts which are neither secondary non-preferential debts nor tertiary non-preferential debts;

b

“secondary non-preferential debts” means non-preferential debts issued under an instrument where—

i

the original contractual maturity of the instrument is of at least one year,

ii

the instrument is not a derivative and contains no embedded derivative, and

iii

the relevant contractual documentation and where applicable the prospectus related to the issue of the debts explain the priority of the debts under this Order, and

c

“tertiary non-preferential debts” means all subordinated debts, including (but not limited to) debts under Common Equity Tier 1 instruments, Additional Tier 1 instruments and Tier 2 instruments (all within the meaning of Part 1 of the Banking Act 2009).

4

In paragraph(3)(b), “derivative” has the same meaning as in Article 2(5) of Regulation (EU) No 648/2012.

5

For the purposes of paragraph (3)(b)(ii) an instrument does not contain an embedded derivative merely because—

a

it provides for a variable interest rate derived from a broadly used reference rate, or

b

it is not denominated in the domestic currency of the person issuing the debt (provided that the principal, repayment and interest are denominated in the same currency).