AiB recently concluded a pre-consultation on the contents of a draft Public Service Reform Order (PSRO 2017) which is designed to make legislative changes to assist with the modernisation of corporate and personal insolvency legislation in Scotland.
Subsequent to this consultation, a draft Order has now been laid in the Scottish Parliament for a 60 day consultation.
By way of background, and as you may be aware, the Scottish Government (through AiB) and the UK Government (through the Insolvency Service) are working on the modernisation of the current Insolvency Rules for Scotland, the Insolvency (Scotland) Rules 1986.
The Insolvency Service has recently concluded an exercise to modernise the existing insolvency rules - Insolvency Rules 1986 - for England and Wales. The modernised Insolvency (England and Wales) Rules 2016 were laid in the UK Parliament on 25 October 2016 and will come into force in April 2017.
In early 2016, Scottish Ministers made The Public Services Reform (Insolvency) (Scotland) Order 2016 (PSRO 2016) as a precursor to the preparation of modernised Insolvency Rules for Scotland. PSRO 2016 in particular sought to bring the position for devolved areas of corporate insolvency in Scotland (receivership and the process of winding up) into line with the position for England and Wales following amendments made to the Insolvency Act 1986 (the 1986 Act) by the Legislative Reform (Insolvency) (Advertising Requirements) Order 2009, but principally the Legislative Reform (Insolvency) (Miscellaneous Provisions) Order 2010.
AiB’s further work on this project identified the need and opportunity to make further changes to the 1986 Act that will assist in the process of rules modernisation. These changes have been included in PSRO 2017 and are explained more fully in the proposed Explanatory Document .
Personal Insolvency – Essential Supplies
PSRO 2017 provides the opportunity to make changes to personal insolvency legislation in Scotland in line with those already introduced in England and Wales through the Insolvency (Protection of Essential Supplies) Order 2015. In general, these changes serve to extend the range of goods and services that are considered essential supplies and introduce certain restrictions on essential suppliers exercising insolvency related clauses in their contracts, subject to safeguards for those suppliers.
The draft PSRO 2017 and associated draft Explanatory Document have now been laid in the Scottish Parliament for an initial 60 day consultation period in accordance with section 26 of the Public Services Reform (Scotland) Act 2010.
AiB would now like to take this opportunity to invite feedback from stakeholders.