Summer holiday anyone? <\/p>\n\n\n\n
Sadly, my attempts to clear my desk hit a speed bump with the landing of two SIs: the unexpected amendments to the IR16 and the not-so-unexpected-but-ETA-long-unclear amendments to the MLR17. Add to that the HMRC change to the approved mileage rates, and the list of template changes is not far off three figures.<\/p>\n\n\n\n
In this blog post, I set out what needs changing in the hope that I can save some of you the time working it all out.<\/p>\n\n\n\n
The Insolvency (England and Wales) (Amendment) Rules 2026 can be found at: https:\/\/www.legislation.gov.uk\/uksi\/2026\/561\/contents\/made<\/a><\/p>\n\n\n\n The Money Laundering and Terrorist Financing (Amendment) Regulations 2026 can be found at: https:\/\/www.legislation.gov.uk\/uksi\/2026\/621\/contents\/made<\/a><\/p>\n\n\n\n <\/p>\n\n\n\n IR16 Changes<\/u><\/strong><\/p>\n\n\n\n With effect from 21 June 2026, the following will be changed:<\/p>\n\n\n\n 1. ADM<\/strong>: removal of appointment by fax options on QFCH out-of-hours appointment notice<\/p>\n\n\n\n 2. ADM<\/strong>: removal of statement of date and time of Administrator\u2019s appointment on Company\/Directors appointment notices (both the form following notice of intention and the form with no notice of intention)<\/p>\n\n\n\n 3. ADM<\/strong>: checklist change that electronic filings to court only require the delivery of one copy of each doc being filed (this change technically affects all case types, but I suspect that in practice ADM appointments is the only occasion it will be felt by IPs)<\/p>\n\n\n\n 4. BKY<\/strong>: amendment to the R10.87 notice (notice that administration of the estate is complete, i.e. the form that accompanies the final report to creditors) as follows:<\/p>\n\n\n\n The Trustee will vacate office under Section 298(8) of the Act when, after the end of the prescribed period, the Trustee:<\/em><\/p>\n\n\n\n 5. BKY<\/strong>: amendment to the final notice(s) to the court of objections to release or no objections received to reflect that the notice may go to the OR instead (in our doc packs, this is only a change to the notice header)<\/p>\n\n\n\n 6. BKY<\/strong>: other docs\/letters will probably need amending to reflect that in debtor\u2019s application cases the final notice is destined for the OR only and that delivery of that notice to the OR results in the Trustee\u2019s release (provided no objections were received)<\/p>\n\n\n\n 7. BKY:<\/strong> checklist changes to reflect the above change to the closure process<\/p>\n\n\n\n Note that R10.87(6) requires a copy of the final notice to be sent to the OR in all <\/em>cases (debtor\u2019s application and creditor\u2019s petition), so the only change is that the Rules now make clear that no delivery of the final notice to the court is required in debtor\u2019s application cases and the delivery of the notice to the OR in those cases results in vacation of office and release (if no objections).<\/p>\n\n\n\n 8. BKY<\/strong>: removal of the debtor\u2019s address from progress (and final) reports<\/p>\n\n\n\n This is an odd change. Dear IP 171 suggests that \u201cidentification details for the bankrupt\u201d is a simple duplication of \u201cidentification details for the proceedings\u201d, so the removal of the former makes no difference. However, it does. <\/p>\n\n\n\n R1.6 defines the ID of the bankrupt as their full name and residential address (unless disclosure is prohibited under Part 20), whereas it defines the ID of the proceedings as the bankrupt\u2019s full name and the court\/adjudicator\u2019s reference. Therefore, removing the ID of the bankrupt from R18.3 means there is no longer a requirement to state the bankrupt\u2019s address in progress reports.<\/p>\n\n\n\n Why would they do this? I have no idea!<\/p>\n\n\n\n Might they consider that it is a bit excessive to provide the bankrupt\u2019s address long after the original order was made? Maybe, but the requirement to ID the bankrupt remains in R1.29(c), which sets out the requirements for statutory notices to creditors etc. This means that the R10.87 notice, which accompanies the final report, still needs to include the bankrupt\u2019s address, so what is achieved by dropping it for progress reports?<\/p>\n\n\n\n This leads me to another question I\u2019ve always had about the BKY rules. What address is required to be disclosed on notices? R1.6 suggests it is the bankrupt\u2019s residential address at the time of the notice, but why?<\/p>\n\n\n\n Surely, the purpose of providing the bankrupt\u2019s residential address is to help creditors track down their claim. But what if the bankrupt moved after the commencement of the bankruptcy? Would the Trustee need to provide to creditors the bankrupt\u2019s new <\/em>address (where the ID of the bankrupt is a statutory requirement)? Wouldn\u2019t this be a disproportionate disclosure of personal information?<\/p>\n\n\n\n If this is the kind of scenario that the Insolvency Service has sought to avoid by amending R18.3, then why did they not change R1.6 to reflect, say, that disclosure of the bankrupt\u2019s residential address means their address at the time of the bankruptcy order?<\/p>\n\n\n\n 9. ADM, BKY, CVL, WUC<\/strong>: perhaps check checklists to ensure they reflect R18.30, which now provides that, where there is a committee, any request for fees over that set out in the fees estimate should be directed to the committee (unless the court fixed the fee basis)<\/p>\n\n\n\n Dear IP explains that this was to address the scenario in which the creditors fixed the fee basis and later a committee was established. The old R18.30 indicated that the additional fee request should go to the creditors, whereas now it makes clear that it should go to the committee.<\/p>\n\n\n\n While that change is fair enough, I think it resurrects an historic shady practice of first getting one\u2019s fees approved by the general body of creditors and thereafter, often at the same meeting, establishing a committee and taking the view that the committee was not required to approve the fees as they had already been dealt with. The Dear IP suggests that this practice \u2013 that the RPBs worked hard to put a stop to \u2013 is no longer dead.<\/p>\n\n\n\n The minor tweak of R18.30 also does not deal with the many other fees issues not satisfactorily addressed by the Rules\u2026 which brings me to another complaint.<\/p>\n\n\n\n <\/p>\n\n\n\n Is that it?!<\/u><\/strong><\/p>\n\n\n\n Dear IP 171 explains that these changes were identified from the first Rules Review and that there will be a consultation \u201cin the coming quarter\u201d in relation other proposals for change identified from that Review.<\/p>\n\n\n\n The first Rules Review report listed a number of other suggestions for change that appeared to me to be minor and technical, for example clarifying the use of “between” in Rs6.14 and 15.4, which in a previous Dear IP the Insolvency Service explained has a different meaning in each rule. <\/p>\n\n\n\n The first Rules Review report also listed “various” other unspecified suggestions, which I hope included not a few of my own. I submitted a consultation response for the first Rules review (MB-rules-review-response-04-07-21.pdf<\/a>) in which I listed many issues that I believe are minor and\/or technical. While of course I accept that the Insolvency Service may disagree with the points I raised, I was disappointed to see that only one of my points – the R10.87 issue with a Trustee\u2019s release in a debtor application case – has been included in the Amendment Rules.<\/p>\n\n\n\n What has happened to all the others? Unless the forthcoming consultation makes clear that they are taking those forward, I\u2019m afraid I have lost all enthusiasm for spending more of my own time pointing out the issues with the Rules.<\/p>\n\n\n\n <\/p>\n\n\n\n MLR17 Changes<\/u><\/strong><\/p>\n\n\n\n The MLR17 amendments take effect from 30 June 2026. While very few will affect insolvency-related docs, I recommend taking a look at the following:<\/p>\n\n\n\n 1. Purchaser AML checklist<\/strong>: amend any reference to the threshold for an occasional transaction, which is being changed from \u20ac15,000 to \u00a312,000. <\/p>\n\n\n\n Per the CCAB AML Guidance appendix for IPs, AML CDD is required by any Trustee in Bankruptcy who intends to carry out an occasional transaction (e.g. selling an asset), so the threshold change is relevant in those cases. <\/p>\n\n\n\n Also, while technically sales dealt with by other office holders are not subject to the AML CDD requirements (unless the insolvent\/MVL entity itself is AML-regulated), many IP firms\u2019 procedures include a risk assessment of proposed asset sales in other cases and use the occasional transaction threshold as part of that assessment. Therefore, you might also want to revisit those procedures.<\/p>\n\n\n\n The HVD threshold is also changing \u2013 from \u20ac10,000 to \u00a310,000 \u2013 but I don\u2019t think many firms expect to sell assets for suitcases full of cash, so I don\u2019t imagine this change will need reflecting anywhere.<\/p>\n\n\n\n 2. AML risk assessments (1)<\/strong>: change \u201cHigh Risk Third Countries\u201d references to \u201cFATF call for action countries\u201d\u2026 but don\u2019t forget their \u201cgrey list\u201d<\/p>\n\n\n\n The Amendments have switched out High Risk Third Countries for the FATF call for action countries. This means that strictly speaking EDD is no longer automatically required for clients established in most of the 25 countries that we\u2019re used to focussing on, but instead only on the currently 3 \u201cblack list\u201d countries (currently DPRK, Iran and Myanmar).<\/p>\n\n\n\n But of course the MLR Supervisors\u2019 guidance encourages us to consider the risks inherent in a wider geographical scope in any event, so any client connection with any of the remaining 22 \u201cgrey list\u201d countries may still be a risk factor that needs to feature in the firm\u2019s Firm-Wide Risk Assessment and in case-specific risk assessment checklists\/guidance.<\/p>\n\n\n\n Therefore, this change seems little more than cosmetic: I don\u2019t think it has any practical effect on firm\u2019s policies, procedures and controls, but if you update your docs to reflect the new terminology, it might demonstrate that you are clued up on the changes.<\/p>\n\n\n\n I suspect also that the .gov.uk High Risk Third Countries page may be renamed or abandoned in future, so you may wish to update any links in forms and guidance to https:\/\/www.fatf-gafi.org\/en\/countries\/black-and-grey-lists.html<\/a><\/p>\n\n\n\n 3. AML risk assessments (2)<\/strong>: change \u201ccomplex and unusually large\u201d to \u201cunusually complex or unusually large in each case given the nature of the transaction\u201d<\/p>\n\n\n\n This is a verrrry subtle change, but again by making the change wherever this phrase appears in Firm-Wide Risk Assessments or case-specific risk assessment checklists\/guidance, it shows you\u2019re up-to-date.<\/p>\n\n\n\n HMRC Mileage Rate Changes<\/u><\/strong><\/p>\n\n\n\n With effect from 6 April 2026, the HMRC-approved mileage rate has changed from 45p to 55p per mile (for the first 10,000 miles in a tax year): https:\/\/www.gov.uk\/government\/publications\/rates-and-allowances-travel-mileage-and-fuel-allowances\/travel-mileage-and-fuel-rates-and-allowances<\/a><\/p>\n\n\n\n Therefore, firms that seek to charge mileage as a Category 2 expense may wish to change their expense policy docs, expenses estimate templates and any other templates that quote the rate.<\/p>\n\n\n\n I also recommend that you have a close look at how you have proposed to set the mileage rate in the docs on existing cases where Category 2 expenses have already been approved. For example, if your docs simply stated the rate at 45p per mile, there would be no automatic right for the firm to recoup mileage costs at 55p per mile even if the firm paid this to its employees. However, if your docs noted that the rate is subject to change in line with any change in HMRC\u2019s rates change, then you may feel confident to recoup mileage incurred since 6 April 2026 at 55p.<\/p>\n\n\n\n So is that everything?<\/u><\/strong><\/p>\n\n\n\n Haha, of course not!<\/p>\n\n\n\n The Data (Use and Access) Act 2025 has been busy rolling out changes since it was made a year ago. Again, most changes are \u2013 as far as I can tell \u2013 pretty inconsequential for day-to-day insolvency work\u2026 although I confess I\u2019ve not read the full 276 pages plus 6 associated sets of regulations! <\/p>\n\n\n\n Fortunately for me, Jo has agreed to take on that little project \u2013 thanks Jo! \ud83d\ude0a<\/p>\n","protected":false},"excerpt":{"rendered":" Summer holiday anyone? Sadly, my attempts to clear my desk hit a speed bump with the landing of two SIs: the unexpected amendments to the IR16 and the not-so-unexpected-but-ETA-long-unclear amendments to the MLR17. Add to that the HMRC change to … Continue reading \n