Chapter 2 - The Insolvency Service

Chapter 2
International Issues
One particular development we are exploring is that of
providing for the electronic provision and transmission of
information within insolvency procedures, as an
alternative to postal delivery, with the aim of reducing the
costs of administering insolvencies and thereby providing
better returns to creditors. As well as the Insolvency Rules
themselves, a further 9 insolvency statutory instruments
are being reviewed and consolidated within this project.
The Service continues to be at the forefront of international insolvency
matters, including UNCITRAL's current discussions on potential new areas of
work. The Service has membership and takes part in the business of The
International Association of Insolvency Regulators and INSOL (a
cross-stakeholder international insolvency organisation). The Service has
been asked to present papers to a number of international groups in the year,
including the INSOL Academics Group and an EC conference on
entrepreneurship. The Service continues to participate in an EC Expert Group
to investigate the extent that the stigma of failure impacts on levels of
entrepreneurship. Work is also planned to design an online diagnostic tool to
act as an early warning device for businesses in financial difficulty.
UNCITRAL
Following a wide consultation process taking in views from the judiciary, the
legal and accountancy professions and other government departments, the
Cross-Border Insolvency Regulations 2006 will be brought into force in
England, Wales and Scotland on 4 April 2006.
These Regulations implement the main measures of a Model Law, formulated
by the United Nations Commission on International Trade Law (UNCITRAL)
in 1997. The Model Law is a legislative text, which assists countries to equip
their insolvency laws with a modern, harmonised and fair framework to deal
with insolvencies that cross international borders. For example, these
Regulations will cover cases where a debtor has assets in more than one
country or where the creditors are located in a different country to the one in
which the insolvency proceedings are taking place. The Regulations should
help creditors, who may be located anywhere in the world, by reducing costs
incurred in realising assets and increasing funds available for distribution.
Employment Rights Directive
Work continues on the implementation of a European Union Directive, which
provides for the protection of employees' rights in the event of the insolvency
of their employer, in particular in order to guarantee payment of their
outstanding claims such as wages, pensions and other benefits. The United
Kingdom already has in place several protective measures enshrined in
27