R3 welcomes exemption on ‘no win, no fee’ arrangements for insolvency
"R3 is pleased to see the exemption for liquidators, administrators and trustees in bankruptcy from the changes to the legislation, which we understood to be for an initial period of 2 years whilst discussions took place on what regime should be applied to litigation by office holders in the long term.
“We hope that the fact that the legislation as drafted does not have a specific time limit means that the Government is considering treating litigation by insolvency practitioners as a permanent exception from the provisions, in the same way that actions for defamation are to be treated in light of the Leveson Report.
“The exemption allows Insolvency Practitioners to pursue errant directors who have run off with company funds, or in serious cases, committed fraud. This costs the business community and the taxpayer hundreds of millions of pounds each year. Directors, who act improperly and strip value out of businesses, should not be allowed to benefit at the expense of legitimate business.”
Frances Coulson, R3 Council Member
Notes to editors (R3):
R3 is the trade body for Insolvency Professionals, and represents 97% of the UK’s Insolvency Practitioners.
R3 comments on a wide variety of personal and corporate insolvency issues. Contact the press office, or see www.r3.org.uk for further information.
R3 promotes best practice for professionals working with financially troubled individuals and businesses; all R3 members are regulated by one of nine recognised professional bodies.
R3 stands for ‘Rescue, Recovery, and Renewal’ and is also known as the Association of Business Recovery Professionals.
Saving provision from The Legal Aid, Sentencing and Punishment of Offenders Act 2012 (Commencement No. 5 and Saving Provision) Order 2013: link here