With the economic downturn there has been an alarming increase in the number of companies entering liquidation and unprecedented numbers of people are being made bankrupt. So the Committee decided to review the work of the Insolvency Service and found it to operate in a generally efficient and effective way. The investigation, though, uncovered concerns about the insolvency regime. Public confidence in the insolvency regime will be damaged unless prompt, robust and effective action is taken to ensure that pre-pack administrations (when a company's business and assets are sold on terms that were negotiated between the buyer and the administrator before the company formally entered administration) are transparent and free from abuse. This causes particular outrage where the existing management buy back the business and continue to trade clear of the original debts ("Phoenix pre-packs"). Pre-packs of this kind fuel concerns about illegitimate, self-serving alliances between directors and insolvency practitioners. The interests of unsecured trade creditors must take a higher priority, especially in "phoenix" pre-pack administrations. The Committee welcomes the new practice statement, Statement of Insolvency Practice 16, which aims to increase the transparency of pre-packs. Monitoring of its implementation, in the recession, becomes a matter of considerable urgency. Insolvency practitioners' remuneration is perceived as unduly high by many creditors: the Insolvency Service should publicise the results of it monitoring to see whether insolvency practitioners are complying with the current practice statement governing the approval of their fees. The Department for Business, Enterprise and Regulatory Reform must ensure the Service's funding arrangements are sufficiently robust to handle the very high levels of insolvency.

The Business, Innovation and Skills Committee has today published a report containing a number of conclusions and recommendations resulting from its inquiry into the Insolvency Service, including: (i) without an increase in resources the investigations unit will be unable to increase the number of cases it can prosecute which will further undermine stakeholder confidence; (ii) there is a risk that further reductions in annual running costs and staff may put undue pressure on the Insolvency Service to deliver; (iii) it is clear from the evidence that the fee-generated income model for the Official Receiver Service is unreliable in the current economic climate (iv) issues remain with pre-pack administration, which need to be addressed; (v) given the level of debt relief they can receive, it would not be unreasonable to increase the £525 upfront fee that individual debtor bankrupts have to pay. The Committee welcomes the news that the regulators and the insolvency industry have been working together to create common regulatory standards across the profession. The creation of a single gateway for complaints, common standards and a common appeals process would be an important step in this regard. The Service should be required to publish an annual report that charts progress in this area.

This important book provides a comprehensive analysis of governance issues that exist in relation to the management of insolvent companies, both while an insolvent company is still controlled by the directors and when it passes into the hands of an insolvency practitioner in a formal insolvency regime. Throughout, the authors argue that the two most important features of corporate governance are transparency and accountability and offer a detailed analysis of the relevant law and practice.

Vanessa Finch provides an interesting look at corporate insolvency laws and processes. She adopts an interdisciplinary approach to place two questions at the centre of her discussion. Are current UK laws and procedures efficient, expert, accountable and fair? Are fundamentally different conceptions of insolvency law needed for it to develop in a way that serves corporate and broader social ends? Topics considered in this wide-ranging book include different ways of financing companies, causes of corporate failure and prospects for designing rescue-friendly processes. Also examined are alternative asset distribution of failed companies, allocations of insolvency risks and effects of insolvency on a company's directors and employees. Finch argues that changes of approach are needed if insolvency law is to develop with coherence and purpose. This book will appeal to academics and students at advanced undergraduate and graduate level, and to legal practitioners throughout the common law world.

Considers (74) S. 3058.

Tolley's Insolvency Law Service is the ideal solution for those who want to reduce the time they spend hunting for information. Whether the client is an individual or a company, a creditor or debtor, Tolley's Insolvency Law is an invaluable companion, saving you time and effort. Leading insolvency experts provide updates six times a year. A practical approach avoids technical jargon in favour of a straightforward explanation of the facts. Users value the first class commentary, guidance and advice on the many methods and solutions relating to personal and corporate insolvency, and rely on Tolley's Insolvency Law as the very first port of call for any insolvency query. A newsletter is provided 12 times a year with this service. This includes topical articles, legislative changes and case updates. Six service updates per year. A practical hands-on approach - ideal for today's busy practitioner.Updates are invoiced separately.