Nortel/Lehman – R3 comments
Responding to the landmark win for Nortel/Lehman at the Supreme Court, R3 vice-president Giles Frampton says:
“The Nortel decision is to be welcomed in that it appears to restore a fair balance between the rights of pension funds and other creditors in administrations.”
“Over time, the rules on the expenses involved in administrations have moved from the principle that expenses should relate to just the outlays that are necessary to implement the administration to a much broader definition. This has hampered business rescue. The Supreme Court’s Nortel decision looks like it could help a move towards that original principle.”
“There are still areas that need clarifying though, for example, the treatment of rent payments as an administration expense. The current rules on this are a bad deal for both businesses and landlords, and put jobs at risk.”
- 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.