Article 13DH Restrictions on grant of security etcF1
During a moratorium, the company may grant security over its property only if the monitor consents.
The monitor may give consent under paragraph (1) only if the monitor thinks that the grant of security will support the rescue of the company as a going concern.
In deciding whether to give consent under paragraph (1), the monitor is entitled to rely on information provided by the company unless the monitor has reason to doubt its accuracy.
If the company grants security over its property during the moratorium otherwise than as authorised by paragraph (1)—
the company commits an offence, and
any officer of the company who without reasonable excuse authorised or permitted the grant of the security commits an offence.
For the consequences of a company granting security over its property in contravention of paragraph (1), see also Article 13DE.
The monitor may not give consent under this Article if the granting of security is an offence under Article 13DI.
Annotations
Textual amendments
Notes on Part 1A
Modifications
- C1
Pts. 1-5 modified by S.R. 2004/307 (as amended (1.10.2006) by Limited Liability Partnerships (Amendment) Regulations (Northern Ireland) 2006 (S.R. 2006/377), reg. 3, Sch. 2; (temp.) (27.4.2020 retrospective) by virtue of Corporate Insolvency and Governance Act 2020 (c. 12), Sch. 11 para. 8(1)(2), 14 (with ss. 2(2), 5(2)); (26.6.2020) by The Limited Liability Partnerships (Amendment etc.) Regulations 2020 (S.I. 2020/643), reg. 1(1), Sch. 2 (with reg. 3); (16.2.2021) by The Limited Liability Partnerships (Amendment etc.) Regulations 2021 (S.I. 2021/60), reg. 1(1), Sch. 2 (with reg. 4(2)))
- C2
Pts. 1-5 applied (with modifications) (4.1.2024) by S.I. 2021/716, Sch. 1A para. 3 (as inserted by The Payment and Electronic Money Institution Insolvency (Amendment) Regulations 2023 (S.I. 2023/1399), reg. 1(2), Sch. 1)