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R3 welcomes call to change Scottish insolvency laws 22 June 2009

Eileen Maclean, the former R3 Council member for Scotland who gave evidence to the Calman Commission said: “I am delighted that Sir Kenneth Calman’s Commission have obviously listened carefully to the recommendations and evidence it received on this issue.

“Its recommendations will, if put in practice, clarify a situation that causes confusion for our members and delays in dealing with companies that have gone into liquidation.”

The Commission concluded ‘devolution has produced an unsatisfactory state of affairs relating to corporate insolvency.’
It cited three reasons for this:

‘There is an absence of clarity as to where responsibility lies for drawing up the rules to be followed by insolvency practitioners dealing with corporate insolvencies.

‘There are unnecessary and confusing divergences between the insolvency rules applying in England and Scotland and
‘There have been unnecessary and damaging delays in introducing new rules in Scotland.’

The Commission also said ‘Many corporate insolvencies involve companies operating on both sides of the border. Clarity, consistency and speed are essential, particularly in the present economic and financial climate.’

Rachel Grant, Chair of R3’s Scottish Technical Committee and a partner with leading law firm Brodies, said: “We would be willing to work with the Government to help achieve these necessary changes in the law. It is vital that recommendations are implemented quickly particularly at a time of high corporate insolvencies, so that we can provide consistency across the UK.”

 

 

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