April 2004 (amended August 2010)

20.1 Introduction

This chapter is divided into 6 parts as follows;

Part 1 - General (paragraphs 20.2 to 20.4)

Part 2 - Company voluntary arrangements (paragraphs 20.5 to 20.15)

Part 3 - Partnerships (paragraph 20.16 to 20.17)

Part 4 - Pre- bankruptcy individual voluntary arrangements (paragraphs 20.18 to 20.21)

Part 5 - Post bankruptcy arrangements where the official receiver is not supervisor (paragraphs 20.22 to 20.43A)

Part 6 - Fast track IVA (where the official receiver is supervisor) (paragraphs 20.44 to 20.80)

Annex 1 - Proforma table to calculate the return to creditors in an FTVA

Annex 2 - Worked example of proforma FTVA table based on income only.

Annex 3 - Worked example of proforma FTVA table including assets and income.

Annex 4 - Worked example of proforma FTVA table where the bankruptcy order was made before 1 April 2004 based on income only..

Annex 5 - Worked example of proforma FTVA table where the bankruptcy order was made before 1 April 2004 including assets and income.

Abbreviations used in this Chapter are:

CVA - Company voluntary arrangement

IVA - Individual voluntary arrangement

FTVA - Fast track individual voluntary arrangement

PVA - Partnership voluntary arrangement

LTAU – Long Term Asset Unit

BRO - Bankruptcy restrictions order

IA86 - Insolvency Act 1986

IA2000 - Insolvency Act 2000.

EA2002 - Enterprise Act 2002

IAR2010 – Insolvency (Amendment) Rules 2010

LRO2010 – The Legislative Reform (Insolvency) (Miscellaneous Provisions) Order 2010 

IPO 1994 The Insolvent Partnerships Order 1994


Note: The notes references in this chapter have been updated to reflect the changes made to the Insolvency Rules as a result of the Insolvency (Amendment) Rules 2010 which came into force on 6 April 2010.

20.2EA Introduction and definitions

A voluntary arrangement involves a legally binding agreement in satisfaction of debts or a scheme of arrangement of the company's/individual's affairs which may involve restructuring, delayed or reduced payments of debts or an orderly disposal of assets. The proposal is put to creditors at meeting(s) and, if approved, its implementation is supervised by a qualified insolvency practitioner or other authorised person. The procedures were laid down in the IA86 and amended by the IA2000, EA2002, IAR2010 and LRO2010.

The voluntary arrangement provisions are designed to provide an alternative to winding up or bankruptcy proceedings. A voluntary arrangement may be entered into before or after insolvency proceedings have been commenced.

Further details of voluntary arrangements can be found in Chapter 56, Part 5, Company Voluntary Arrangements, and Chapter 57, Part 1, Individual Voluntary Arrangements. This chapter concentrates on the official receiver's role in both company and individual voluntary arrangements.


20.3EA Official Receiver's involvement

The official receiver should have no involvement with voluntary arrangements where no winding-up or bankruptcy order is made. The exception to this would be where the official receiver represents a creditor e.g. as liquidator of a creditor company.

The official receiver's involvement in post insolvency proceeding voluntary arrangements (except fast track IVAs, see Part 6) should be limited and he/she should not take any steps designed to frustrate any proposals made unless it is clear that an attempt is being made to mislead the creditors. The official receiver should provide information where necessary and may draw to the court's attention any difficulties or special considerations of which he/she is aware.


20.4EA Representations to the court

The official receiver is most likely to become involved with an IVA (except fast track IVAs, see Part 6) if an interim order is sought where it is in order for him/her to draw to the court’s attention any particular difficulties or special considerations which he/she believes the court may wish to be aware of. For example, there may have been a special manager appointed who is actively engaged in selling property and his/her remuneration may need to be taken into account when the details of the arrangement are agreed. It is open to the court to include provisions for such circumstances, and other matters concerning the conduct of the bankruptcy, in the terms of an interim order, if granted.

Notes: [s252; R5.6(1) and (2)] [s370] [s255] [R5.7 and 5.9]


[On to Part 2 - Company voluntary arrangements]