INSOLVENCY Citation, commencement and interpretation 1 1 These Rules may be cited as the Insolvent Companies (Reports on Conduct of Directors) Rules 1996. 2 These Rules shall come into force on 30th September 1996. 3 In these Rules— “ the Act ” means the Company Directors Disqualification Act 1986; “the former Rules ” means the Insolvent Companies (Reports on Conduct of Directors) No. 2 Rules 1986 ; and “the commencement date” means 30th September 1996. Revocation 2 Subject to rule 7 below, the former Rules are hereby revoked. Reports required under section 7(3) of the Act 3 1 This rule applies to any report made to the Secretary of State under section 7(3) of the Act by:— a the liquidator of a company which the courts in England and Wales have jurisdiction to wind up which passes a resolution for voluntary winding up on or after the commencement date; b an administrative receiver of a company appointed otherwise than under section 51 of the Insolvency Act 1986 (power to appoint receiver under the law of Scotland) on or after the commencement date; or c the administrator of a company which the courts in England and Wales have jurisdiction to wind up in relation to which the court makes an administration order on or after the commencement date. 2 Such a report shall be made in the Form D1 set out in the Schedule hereto, or in a form which is substantially similar, and in the manner and to the extent required by the Form D1. Return by office-holder 4 1 This rule applies where it appears to a liquidator of a company as mentioned in rule 3(1)(a), to an administrative receiver as mentioned in rule 3(1)(b), or to an administrator as mentioned in rule 3(1)(c) (each of whom is referred to hereinafter as “an office-holder”) that the company has at any time become insolvent within the meaning of section 6(2) of the Act. 2 Subject as follows there may be furnished to the Secretary of State by an office-holder at any time during the period of 6 months from the relevant date (defined in paragraph (4) below) a return with respect to every person who:— a was, on the relevant date, a director or shadow director of the company, or b had been a director or shadow director of the company at any time in the 3 years immediately preceding that date. 3 The return shall be made in the Form D2 set out in the Schedule hereto, or in a form which is substantially similar, and in the manner and to the extent required by the Form D2. 4 For the purposes of this rule, “the relevant date” means:— a in the case of a company in creditors' voluntary winding up (there having been no declaration of solvency by the directors under section 89 of the Insolvency Act 1986), the date of the passing of the resolution for voluntary winding up, b in the case of a company in members' voluntary winding up, the date on which the liquidator forms the opinion that, at the time when the company went into liquidation, its assets were insufficient for the payment of its debts and other liabilities and the expenses of winding up, c in the case of the administrative receiver, the date of his appointment, d in the case of the administrator, the date of the administration order made in relation to the company, and for the purposes of sub-paragraph (c) above the only appointment of an administrative receiver to be taken into account in determining the relevant date shall be that appointment which is not that of a successor in office to an administrative receiver who has vacated office either by death or pursuant to section 45 of the Insolvency Act 1986. 5 Subject to paragraph (6) below, it shall be the duty of an office-holder to furnish a return complying with the provisions of paragraphs (3) and (4) of this rule to the Secretary of State:— a where he is in office in relation to the company on the day one week before the expiry of the period of 6 months from the relevant date, not later than the expiry of such period; b where he vacates office (otherwise than by death) before the day one week before the expiry of the period of 6 months from the relevant date, within 14 days after his vacation of office except where he has furnished such a return on or prior to the day one week before the expiry of such period. 6 A return need not be provided under this rule by an office-holder if he has, whilst holding that office in relation to the company, since the relevant date, made a report under rule 3 with respect to all persons falling within paragraph (2) of this rule and (apart from this paragraph) required to be the subject of a return. 7 If an office-holder without reasonable excuse fails to comply with the duty imposed by paragraph (5) of this rule, he is guilty of an offence and— a on summary conviction of the offence, is liable to a fine not exceeding level 3 on the standard scale, and b after continued contravention, is liable to a daily default fine; that is to say, he is liable on a second or subsequent summary conviction of the offence to a fine of one-tenth of level 3 on the standard scale for each day on which the contravention is continued (instead of the penalty specified in sub-paragraph (a)). 8 Section 431 of the Insolvency Act 1986 (summary proceedings), as it applies to England and Wales, has effect in relation to an offence under this rule as to offences under Parts I to VII of that Act. Forms 5 The forms referred to in rule 3(2) and rule 4(3) shall be used with such variations, if any, as the circumstances may require. Enforcement of section 7(4) 6 1 This rule applies where under section 7(4) of the Act (power to call on liquidators, former liquidators and others to provide information) the Secretary of State or the official receiver requires or has required a person:— a to furnish him with information with respect to a person’s conduct as director or shadow director of a company, and b to produce and permit inspection of relevant books, papers and other records. 2 On the application of the Secretary of State or (as the case may be) the official receiver, the court may make an order directing compliance within such period as may be specified. 3 The court’s order may provide that all costs of and incidental to the application shall be borne by the person to whom the order is directed. Transitional and saving provisions 7 1 Subject to paragraph (2) below, rules 3 and 4 of the former Rules shall continue to apply as if the former Rules had not been revoked when any of the events mentioned in sub-paragraphs (a), (b) or (c) of rule 3(1) of the former Rules (passing of resolution for voluntary winding up, appointment of administrative receiver, making of administration order) occurred on or after 29th December 1986 but before the commencement date. 2 Until 31st December 1996— a the forms contained in the Schedule to the former Rules which were required to be used for the purpose of complying with those Rules, or b the Form D1 or D2 as set out in the Schedule to these Rules, as appropriate, or a form which is substantially similar thereto, with such variations, if any, as the circumstances may require, may be used for the purpose of complying with rules 3 and 4 of the former Rules as applied by paragraph (1) above; but after that date the forms mentioned in sub-paragraph (b) of this paragraph shall be used for that purpose. 3 When a period referred to in rule 5(2) of the former Rules is current immediately before the commencement date, these Rules have effect as if rule 6(2) of these Rules had been in force when the period began and the period is deemed to expire whenever it would have expired if these Rules had not been made and any right, obligation or power dependent on the beginning, duration or end of such period shall be under rule 6(2) of these Rules as it was or would have been under the said rule 5(2). 4 The provisions of this rule are to be without prejudice to the operation of section 16 of the Interpretation Act 1978 (saving from repeals) as it is applied by section 23 of that Act. Mackay of Clashfern, C. 17th July 1996 I concur, on behalf of the Secretary of State Phillip Oppenheim, Parliamentary Under Secretary of State for Company Affairs, Department of Trade and Industry 22nd July 1996