The Companies (Guernsey) Law, 2008 (Insolvency) (Amendment) Ordinance, 2020 (the "Ordinance") and the Companies (Guernsey) (Insolvency Rules) Regulations, 2022 (the "Insolvency Rules") are due to come into operation on 1 January 2023, following regulations made today by the Committee for Economic Development (the "Committee").
This represents the most significant and wide-ranging reform of Guernsey's corporate insolvency regime since 2008, and will have implications for company directors and their advisors. Immediate considerations include:
- What are the steps for placing a solvent or an insolvent company into Members' Voluntary Liquidation, and how do they now differ?
- Can a director of a company, or another connected person, be appointed Liquidator?
- What considerations should a director have when making a Declaration of Solvency?
- What are the potential repercussions in making an incorrect Declaration of Solvency?
- What requirements will Liquidators and Administrators now have in relation to director misconduct?
- In what circumstances might an audit be required?
- How might these changes impact the duration and the cost of an Administration, or a Members’ Voluntary Liquidation?