Companies Act 1967

79 Margin of solvency for general business.

(1) For subsection (1) of section 13 (margin of solvency) of the principal Act, there shall be substituted the following subsection:—

“(1) An insurance company to which this Act applies, being a company which carries on (whether within or outside Great Britain) general business, shall be deemed for the purposes of section two hundred and twenty-two of the [1948 c. 38.] Companies Act 1948 (which authorises the court to wind up a company unable to pay its debts), to be unable to pay its debts if, at any time in its first financial year, the value of its assets does not exceed the amount of its liabilities by £50,000, or if, at any time after the expiration of that year, the value of its assets does not exceed the amount of its liabilities by the amount which is the relevant amount for the purposes of section 62(1)(a) of the Companies Act 1967 ; and the provisions of this Act as to winding up shall have effect accordingly”.

(2) Subject to the provisions of the following subsection, the Board of Trade may, at any time before the expiration of the period of two years beginning with the day on which this Act is passed, direct that, until the expiration of such period (expiring not later than the expiration of the period aforesaid) as may be specified in the direction, the subsection substituted by the foregoing subsection shall, in its application to an insurance company so specified, being one which, immediately before the passing of this Act, was carrying on (whether within or outside Great Britain) business which then constituted general business for the purposes of the principal Act, have effect subject to such relaxative modifications as may be so specified.

(3) The power conferred by the last foregoing subsection on the Board of Trade shall not be exercisable in relation to a company so long as a petition to wind it up is before the court.