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FCA consultation paper tracker—2021 [Archived]

FCA consultation paper tracker—2021 [Archived] ARCHIVED: This Practice Note is archived and is no longer maintained. This tracker sets out the consultation papers published by the Financial Conduct Authority (FCA) in 2021, along with the publication of any subsequent rules and guidance. For details of FCA consultation papers from other years, see: FCA consultation paper trackers. For details of Prudential Regulation Authority (PRA) and Financial Services Authority (FSA) consultation papers, see: • PRA consultation paper tracker [Archived] • FSA consultation paper tracker [Archived] Topic area Consultation Paper Description Publication date End of consultation period Policy Statement/ Handbook Notice Consumer protection CP21/36: A new Consumer Duty: Feedback to CP21/13 and further consultation  The FCA published consultation paper CP21/36, A new Consumer Duty: Feedback to CP21/13 and further consultation. It sets out the FCA’s analysis of comments received on CP21/13 and the FCA’s revised proposals for a new Consumer Duty. The FCA expects to confirm any final rules by the end of July 2022. 7 December 2021 15 February 2022 PS22/9...

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Prohibited names under section 216 of the Insolvency Act 1986

The purpose of section 216 of the Insolvency Act 1986Section 216 of the Insolvency Act 1986 (IA 1986) is aimed at preventing phoenix companies from causing a disadvantage to creditors by creating more transparency surrounding the re-use of company names.A phoenix company may typically be where a director or directors trade a successive company with a similar name, taking the valuable parts of the company in liquidation, leaving behind its creditors. The re-use of the name is seen by many as a way of deceiving creditors into thinking they are dealing with the same company. This practice (known as phoenixing) is therefore met with distrust by creditors.The Insolvency Service has produced guidance on the law relating to the practice of carrying on a business through a series of companies where each becomes insolvent, ie 'phoenix companies'.In some circumstances, the purchase of the business and assets of the company in liquidation and the continuation of the business can be positive, especially for employees, and can be a way of bringing money...

Transfer to Newco

A popular restructuring method is to transfer the company's assets or business to a newly formed company (Newco). Essentially the good assets and business(es) are cherry-picked and transferred into Newco. In return for reducing or cancelling their debt claims against the company (and the rest of the group), financial creditors may exchange:•debt in the company for debt in Newco•debt in the company for equity in Newco, or•debt in the company for debt and equity in NewcoThe transfer reduces/extinguishes liabilities on the company's balance sheet liabilities. In debt for equity swaps, it allows creditors to take some of the upside following a restructuring once Newco generates a profit (as equity holders, they are entitled to dividends once there are sufficient distributable reserves) or on any subsequent sale (see Practice Note: Debt for equity swaps).It is vital to obtain a robust valuation as this shows where value breaks; that tranche will expect to receive the most equity post-restructuring (see Practice Notes: Types of valuation for R&I lawyers and Where the value breaks...

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Sentencing company directors for breach of disqualification

Corporate Crime analysis: The Sentencing Council has published the Definitive Guideline for Breach Offences which includes, for the first time, a guideline for sentencing in cases where disqualified directors have acted in breach of their disqualification. Leon Kazakos of 2 Hare Court assesses how the Guideline will operate in practice.