Administration (Restrictions on Disposal etc. to Connected Persons) Regulations 2021
What this means for your business
- Applies to
- United Kingdom
- On this page
- 5 compliance obligations, 1 practical guide
What you must do
5 compliance obligations under this legislation.
Insurance 1
Maintain professional indemnity insurance
If you are required to provide a qualifying report under the administration regulations, you must have active professional indemnity insurance. The cover must protect against any liability you could face to the administrator, connected persons, creditors or others arising from the matters you report.
Notifications 1
Notify Companies House and creditors of qualifying report and disposal reasons
If you are acting as the administrator of a company and you receive a qualifying report that leads you to make a substantial disposal, you must send a copy of that report (with any confidential details removed) to Companies House and to every known creditor. If the report contains a ‘case not made’ opinion or highlights previous unreasonable disposal advice, you also need to include a statement explaining why you are still proceeding with the disposal.
Reporting and filing 3
Include previous report details in any new qualifying report
When you prepare a qualifying report for a connected person, you must check whether they have already obtained a previous report. If they have, you need to attach or summarise that earlier report. If you cannot get it, you must explain why, what you have done to try to obtain it, and why you think it exists.
Obtain and submit a qualified report for disposal in administration
If your business, as a connected person, wants to dispose of assets while the company is in administration, you must get a written, dated and signed report from a qualified evaluator and give it to the administrator. The report must stay accurate – no material changes to the assets, disposal terms or circumstances may have occurred since it was written.
Obtain approval or a qualifying report before a substantial disposal
If you are the administrator of a company in administration and want to sell, hire out or otherwise dispose of a major part of the business to a connected person within the first eight weeks, you must first get the creditors’ consent or obtain a qualifying report. If you go the qualifying‑report route you also have to follow the notification steps set out in regulation 9.
Practical guidance
Our guides explain how to comply with the requirements above.
Sections and provisions
13 classified provisions from this legislation.
Duties 5
- s.3 Conditions and requirements that apply in respect of a substantial disposal by the administrator An administrator
- s.6 Qualifying report: requirements to be met in connection with obtaining and considering the report circumstances relating
- s.8 Qualifying report: additional requirements where previous report obtained
- s.9 Notification requirements where a qualifying report is obtained the administrator
- s.11 The requirement as to insurance