The Enterprise Act 2002 (Insolvency) Order 2003

Explanatory Note

(This Note is not part of the Order)

This Order makes minor amendments to provisions of the Enterprise Act 2002 (c. 40). It also makes amendments to both primary and secondary legislation consequent upon the changes made by the Enterprise Act 2002 to the Insolvency Act 1986 (c. 45).

Article 2 makes amendments to Schedule B1 to the Insolvency Act 1986 as set out in Schedule 16 to the Enterprise Act 2002, which is given effect by section 248 of the Enterprise Act 2002.

• Article 2(2) amends paragraph 12 of Schedule B1. This amendment states that the provisions of paragraph 12 are without prejudice to the right of a supervisor of a voluntary arrangement to make an application for an administration order under section 7 of the Insolvency Act 1986.

• Article 2(3) amends paragraph 43 of Schedule B1. This amendment makes clear that an administrative receiver may not be appointed once the company is subject to a moratorium under paragraph 44 of Schedule B1.

• Articles 2(4) and (5) reword the description of the person who must be notified when an administrator resigns or ceases to qualify to act. The substituted description takes account of the fact that the person who appointed the administrator under the floating charge may have transferred the floating charge to another holder since the appointment, and it is the current holder of the floating charge who should be informed of the resignation or ceasing to qualify.

Article 3 amends paragraph 4 of Schedule 19 to the Enterprise Act 2002 to make it clear that the provisions of paragraph 4(1) are subject to the provisions of paragraphs 2 and 3.

Articles 4 and 5 give effect to the Schedule to the Order, Part 1 of which makes amendments to primary legislation and Part 2 of which makes amendments to secondary legislation all of which are consequential upon changes made by the Enterprise Act 2002 to the law on the procedure for administration as set out in the Insolvency Act 1986. Article 6 contains transitional provisions for cases where a petition for an administration order is presented before the 15th September 2003.

The costs to business of the commencement of the provisions of the Enterprise Act 2002 are set out in the Regulatory Impact Assessment prepared for that Act. Copies of the assessment are available from Policy Unit, The Insolvency Service, 21 Bloomsbury Street, London, WC1B 3QW.