The long awaited new Scottish Insolvency Rules for Company Voluntary Arrangements and Administration (The Insolvency (Scotland) (Company Voluntary Arrangements and Administration) Rules 2018) were laid in Parliament today. The Rules are a negative SI which means they do not need active approval by Parliament and will automatically come into effect as law unless either the Commons or Lords annuls them within a fixed period after they have been laid. The intention is that they will commence on 6 April 2019. A second set of rules which cover Liquidation and Receivership in Scotland (The Insolvency (Scotland)(Receivership and Winding Up) Rules 2018) are due to be laid before the Scottish Parliament shortly and will come into force on the same date.
The new Scottish Rules are drafted very much to mirror as far as possible the Insolvency Rules for England and Wales. This will make it easier to deal with cross border insolvencies particularly where a group of companies enters formal insolvency. However Scotland has a separate judicial system and there are still some important differences in the rules applicable north and south of the border which reflect the different laws of the two jurisdictions. One example of this is that the Scottish procedure for approval of an office holder's fees and disbursements remains more or less the same and is very different from the procedure in England and Wales.
Insolvency practitioners and their advisors now have 6 months to familiarise ourselves with the new rules which are more lengthy and detailed than the existing rules but should in the long run make things clearer and easier.