Skip to content

How creditors will make insolvency decisions after 6 April 2017

Insolvency practitioners are well versed to creditors’ meetings as the way in which creditors make decisions about a company or individual who is insolvent and how the process is managed. However, from 6 April 2017 the profession and creditors will have to get used to a completely new way of operating as a result of the one of the major changes made by The Insolvency (England & Wales) Rules 2016.

Creditors will still be the decision makers in the insolvency process but physical creditors’ meetings are now not the main method at which decisions will be taken by creditors.

There are now four ‘decision procedures’ specifically defined by the rules, namely:

  • virtual meeting,
  • correspondence,
  • electronic voting; and
  • physical meetings. Physical meetings may only be used in exceptional circumstances.


In addition, deemed consent can be used to obtain a decision from creditors but it is not a ‘decision procedure’.  This distinction is critical as only decision procedures can be used for the approval of remuneration

Virtual meeting

 A virtual meeting is one where creditors are not invited or allowed to be at a physical location but may participate by way of telephone or video conferencing.

Electronic Voting

Electronic voting is an electronic system whereby creditors may vote without having to attend a physical location to do so by the decision date. Systems like Survey Monkey or similar would best fit this process.


When seeking a decision by correspondence, creditors will be sent various proposed resolutions and will then complete and return the voting form by the decision date.

Physical meeting

A physical creditors’ meeting may only be called if the “10 10 10” rule is met. After notice of a decision making process has been sent to creditors, a physical meeting can be requestiioned if either of the following conditions is met:

  • 10% of the value of creditors request a meeting
  • 10% of the total number of creditors request a meeting
  • 10 individual creditors request a meeting.


These physical meetings will operate in much the same way as used to do.

Deemed consent

Alternatively, an office holder may send creditors a notice of resolutions by deemed consent. Creditors are deemed to have consented to a decision or resolution after notice of the decision or resolution is sent to creditors and fewer than 10% in value have objected to it. If objections are not received by the decision date creditors will be deemed to have consented to the decision or resolution.

Obviously it will take a while for creditors to become accustomed to these new processes and therefore PBC will gladly assist anybody in explaining the new processes.