SPI general technical committee chairman Rob Robinson will head a deputation including Bill Roberts, John Francis, and Chris Hanson, all technical specialists, who will give evidence on the draft clauses of the Insolvency Bill which was rushed out last month.
Robinson said that the main thrust of the SPI's case will centre on proposals to give Stephen Byers new powers to make debenture holders or banks give notice before appointing a receiver while also allowing unlicensed IPs to help on schemes of arrangement.The first change will means that banks would have to give five days' written notice before appointing an administrative receiver, a concept which is designed to give a company 'breathing space' to be able to put a rescue plan in place which would prevent the banks from acting.
Byers has widely heralded the use of a moratorium in the belief that banks push a company into receivership too quickly to secure their investment without taking true account of the future of the business.But Robinson said: 'The idea of a moratorium is fine in principle but the only time a bank goes in right away is when it believes that the directors are putting the assets in danger.'
Any change could allow rogue directors to run off with the assets while the added complexity could make the success of the company voluntary arrangement, where an emphasis is placed on saving the business, far too expensive for many small companies. This is because all the preparatory work would have to be done in advance.SPI's other main concern is in relation to allowing unlicensed IPs to assist on CVAs, which is says would only create confusion in the market.
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