Changes to Guernsey’s insolvency regime

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?

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