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Insolvency

Business, Innovation and Skills written question – answered on 8th November 2011.

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Photo of Ian Liddell-Grainger Ian Liddell-Grainger Conservative, Bridgwater and West Somerset

To ask the Secretary of State for Business, Innovation and Skills what assessment he has made of the merits of amending section 233 of the Insolvency Act to prevent suppliers demanding payments upon insolvency where such payments make company rescue harder or reduce dividends to creditors.

Photo of Edward Davey Edward Davey The Parliamentary Under-Secretary of State for Business, Innovation and Skills

The Government have previously announced that we would consider the case for updating section 233 of the Insolvency Act 1986 and the wider issue of termination clauses. We are aware of the problems that can be caused for those seeking to rescue a struggling company by such clauses. We are currently looking into the merits of any change, and have been discussing this with interested parties.

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