Insolvency Act 1986 (c. 45)

[F1 Part A1 U.K. Moratorium

Textual Amendments

F1 Pt. A1 inserted (26.6.2020) by Corporate Insolvency and Governance Act 2020 (c. 12), ss. 1(1), 49(1) (with ss. 2(2), 5(2))

Modifications etc. (not altering text)

C1 Pt. A1 excluded by S.I. 2012/3013, Sch. 1 para. 1(2A) (as inserted (26.6.2020) by Corporate Insolvency and Governance Act 2020 (c. 12), s. 49(1), Sch. 3 para. 49(4) (with ss. 2(2), 5(2)))

C2 Pt. A1 power to apply (with modifications) conferred by 2011 c. 25, s. 247A (as inserted (26.6.2020) by Corporate Insolvency and Governance Act 2020 (c. 12), s. 49(1), Sch. 3 para. 45 (with ss. 2(2), 5(2)))

Chapter 4 U.K. Effects of moratorium

Restrictions on transactions U.K.

A27 Prohibition on entering into market contracts etc U.K.

(1) If a company enters into a transaction to which this section applies during a moratorium for the company—

(a) the company commits an offence, and

(b) any officer of the company who without reasonable excuse authorised or permitted the company to enter into the transaction commits an offence.

(2) A company enters into a transaction to which this section applies if it—

(a) enters into a market contract,

(b) enters into a financial collateral arrangement,

(c) gives a transfer order,

(d) grants a market charge or a system-charge, or

(e) provides any collateral security.

(3) Where during the moratorium a company enters into a transaction to which this section applies, nothing done by or in pursuance of the transaction is to be treated as done in contravention of any of sections A19, A21, A25, A26 and A28 to A32.

(4) In this section—

• “collateral security” has the same meaning as in the Financial Markets and Insolvency (Settlement Finality) Regulations 1999 (S.I. 1999/2979);

• “financial collateral arrangement” has the same meaning as in the Financial Collateral Arrangements (No. 2) Regulations 2003 (S.I. 2003/3226);

• “market charge” has the same meaning as in Part 7 of the Companies Act 1989;

• “market contract” has the same meaning as in Part 7 of the Companies Act 1989;

• “system-charge” has the meaning given by the Financial Markets and Insolvency Regulations 1996 (S.I. 1996/1469);

• “transfer order” has the same meaning as in the Financial Markets and Insolvency (Settlement Finality) Regulations 1999.]