Companies (Rescue Process for Small and Micro Companies) Act 2021

Companies (Rescue Process for Small and Micro Companies) Act 2021 Skip to content Disclaimer Feedback Helpdesk Gaeilge Léim go dtí an t-ábhar Séanadh Aiseolas Deasc chabhrach English Gaeilge English Produced by the Office of the Attorney General Táirgthe ag Oifig an Ard-Aighne Home Legislation Acts of the Oireachtas Statutory Instruments Pre-1922 Legislation Constitution External Resources Bills (Houses of the Oireachtas) Iris Oifigiúil / Official Gazette Revised Acts (LRC) Classified List of Legislation (LRC) Translations (acts.ie) Translations (Houses of the Oireachtas) Government Publications for Sale EU Law (EUR-Lex) FAQ Disclaimer Feedback Helpdesk Search Baile Reachtaíocht Achtanna an Oireachtais Ionstraimí Reachtúla Reachtaíocht Réamh-1922 Bunreacht Acmhainní Seachtracha Billí (Tithe an Oireachtais) Iris Oifigiúil Achtanna Athbhreithnithe (CAD) (An Coimisiún um Athchóiriú an Dlí) Liosta Rangaithe Reachtaíochta Aistriúcháin (achtanna.ie) Aistriúcháin (Tithe an Oireachtais) Foilseacháin Rialtais ar Díol Dlí AE (EUR-Lex) CCanna (Ceisteanna Coitianta) Séanadh Aiseolas Deasc chabhrach Cuardach TitleTeideal Year(s) or rangeBliain nó blianta nó raon TypeCineál All Legislation Acts Statutory Instruments Advanced SearchCuardach Casta HomeBaile ActsAchtanna 2021 Companies (Rescue Process for Small and Micro Companies) Act 2021 Companies (Rescue Process for Small and Micro Companies) Act 2021 Permanent Page URL View by SectionAmharc de réir Ailt View Full ActAmharc ar an Acht Iomlán Bill History Stair Bille Commencement, Amendments, SIs made under the Act Tosach Feidhme, Leasuithe, IRí arna ndéanamh faoin Acht Open PDFOscail PDF Print Full ActPriontáil an tAcht Iomlán Number 30 of 2021 COMPANIES (RESCUE PROCESS FOR SMALL AND MICRO COMPANIES) ACT 2021 CONTENTS PART 1 General 1. Short title and commencement 2. Definition PART 2 Rescue Process for Small and Micro Companies 3. Rescue process for small and micro companies PART 3 Miscellaneous Amendments of Companies Act 2014 4. Amendment of section 2 of Principal Act 5. Amendment of section 511 of Principal Act 6. Amendment of section 587 of Principal Act 7. Amendment of section 610 of Principal Act 8. Amendment of section 627 of Principal Act 9. Amendment of section 666 of Principal Act 10. Amendment of section 667 of Principal Act 11. Amendment of section 668 of Principal Act 12. Amendment of section 690A of Principal Act Acts Referred to Central Bank Act 1971 (No. 24) Companies Act 2014 (No. 38) Protection of Employees (Employers’ Insolvency) Acts 1984 to 2020 Redundancy Payments Acts 1967 to 2014 Social Welfare Consolidation Act 2005 (No. 26) Number 30 of 2021 COMPANIES (RESCUE PROCESS FOR SMALL AND MICRO COMPANIES) ACT 2021 An Act to amend the Companies Act 2014 to provide, in certain circumstances, for a rescue process for small and micro companies which are, or are likely to be, unable to pay their debts; and for related matters. [22nd July, 2021] Be it enacted by the Oireachtas as follows: PART 1 General Short title and commencement 1. (1) This Act may be cited as the Companies (Rescue Process for Small and Micro Companies) Act 2021. (2) This Act shall come into operation on such day or days as the Minister for Enterprise, Trade and Employment may appoint by order or orders either generally or with reference to any particular purpose or provision and different days may be so appointed for different purposes or different provisions. Definition 2. In this Act, “Principal Act” means the Companies Act 2014 . PART 2 Rescue Process for Small and Micro Companies Rescue process for small and micro companies 3. The Principal Act is amended by the insertion of the following Part after section 558— “PART 10A Rescue Process for Small and Micro Companies Chapter 1 Interpretation Interpretation (Part 10A) 558A. (1) In this Part— ‘director’ includes a shadow director; ‘eligible company’ means a company which qualifies as— (a) a small company in accordance with section 280A, or (b) a micro company in accordance with section 280D; ‘excludable debt’ has the meaning assigned to it by section 558L(4); ‘interested party’, in relation to an eligible company, means— (a) a creditor of the eligible company, or (b) a member of the eligible company; ‘process adviser’ means— (a) except as specified in paragraphs (b) and (c), a process adviser appointed by the directors of an eligible company by resolution mentioned in section 558E or 558ZX, (b) in Chapter 2 of this Part, a process adviser acting under that Chapter, and (c) in sections 558ZP, 558ZQ and 558ZAI and Chapter 11 of this Part— (i) except where the context otherwise requires, a process adviser acting under Chapter 2 of this Part, or (ii) a process adviser appointed by the directors of an eligible company by resolution mentioned in section 558E or 558ZX; ‘relevant court’, in relation to an eligible company, means, subject to section 558ZAF, the court determined by the process adviser under section 558H; ‘rescue period’, in relation to an eligible company, means the period— (a) beginning with the passing of the resolution mentioned in section 558E(2) appointing a process adviser in respect of the eligible company, and (b) ending on— (i) the date on which the appointment of the process adviser is terminated under section 558ZK, or (ii) in a case where the process adviser resigns and the directors of the eligible company do not appoint another process adviser, the date on which the process adviser resigns; ‘rescue plan’ has the meaning assigned to it by section 558B. (2) For the purposes of sections 558Q, 558Y, 558Z and 558ZD, a member’s claim against an eligible company is impaired if— (a) the nominal value of his or her shareholding in the eligible company is reduced, (b) where the member is entitled to a fixed dividend in respect of his or her shareholding in the eligible company, the amount of that dividend is reduced, (c) the member is deprived of all or any part of the rights accruing to him or her by virtue of his or her shareholding in the eligible company, (d) the percentage of his or her interest in the total issued share capital of the eligible company is reduced, or (e) the member is deprived of his or her shareholding in the eligible company. (3) For the purposes of sections 558Q, 558Y, 558Z and 558ZD, a creditor’s claim against an eligible company is impaired if the creditor receives less in payment of his or her claim than the full amount due in respect of the claim at the date of passing of the resolution for the appointment of the process adviser. Chapter 2 Introductory Requirements where eligible company wishes to avail of rescue plan 558B. (1) This section applies where— (a) the conditions specified in subsection (2) are met in relation to an eligible company, and (b) the directors of the eligible company wish to avail of a rescue plan. (2) The conditions referred to in subsection (1) are— (a) the eligible company is, or is likely to be, unable to pay its debts, (b) no resolution subsists for the winding up of the eligible company, (c) no order has been made for the winding up of the eligible company, (d) the directors of the eligible company have not passed a resolution for the appointment of a process adviser in respect of the eligible company during the period of 5 years ending on the date on which it is proposed that such a resolution be passed by the eligible company, (e) no examiner has been appointed to the eligible company during the period of 5 years referred to in paragraph (d). (3) For the purposes of subsection (2)(a), an eligible company is unable to pay its debts if— (a) it is unable to pay its debts as they fall due, (b) the value of its assets is less than the amount of its liabilities, taking into account its contingent and prospective liabilities, or (c) the circumstances set out in section 570(a), (b) or (c) are applicable to the eligible company. (4) A director of the eligible company shall— (a) make a full inquiry into the affairs of the eligible company, (b) prepare in the prescribed form a statement specifying the information set out in subsection (5), (c) by statutory declaration confirm that he or she has complied with paragraph (a), and (d) submit the statement and the statutory declaration to a process adviser. (5) The information referred to in subsection (4)(b) is— (a) particulars of the eligible company’s assets, debts and liabilities, (b) the names and addresses of the eligible company’s creditors, (c) particulars of each security given by the eligible company, including the name of the secured creditor and the date on which it was given, and (d) such further or other information as may be prescribed. (6) Where any false or misleading statement has been included in the statement of affairs referred to in subsection (4), any director of the eligible company who is in default shall be guilty of a category 2 offence. (7) In any proceedings against a person in respect of an offence under subsection (6), it shall be a defence to prove that, having exercised all reasonable skill and care, the defendant had reasonable grounds for believing and did, up to the time of the issue of the document concerned, believe that the statement concerned was true. (8) In this section, ‘rescue plan’ means a plan for an eligible company under this Part that is intended to secure the survival of the company, and the whole or any part of its undertaking, as a going concern. Process adviser to determine whether eligible company has reasonable prospect of survival 558C. (1) This section applies where a director of an eligible company submits a statement and a statutory declaration to a process adviser under section 558B(4). (2) The process adviser shall determine whether there is a reasonable prospect of the survival of the eligible company, and the whole or any part of its undertaking, as a going concern. (3) In making a determination under subsection (2), the process adviser shall have regard to— (a) the statement, and (b) such of the matters specified in subsection (4) as appear to the process adviser to be relevant in the circumstances. (4) The matters referred to in subsection (3) are— (a) the nature of, and prospects for, the business of the eligible company, (b) the availability of funding for, and investment in, the eligible company in the future, including expressions of interest by external funders, (c) the cost structure of the eligible company, including any cost reductions already achieved or that may be achieved, (d) whether projections and business plans for the eligible company are based on objective and independent evidence, (e) whether the eligible company can generate a sufficient return to remunerate investment and repay funding, (f) the wider economic situation, (g) the circumstances of the market in which the eligible company is operating, including the likely future prospects of the market, (h) the expertise, brand and historic success of the eligible company, (i) where the eligible company is part of a group of companies, the place of the company in the structure of the group and its prospects in that context, (j) whether a secured creditor has expressed an interest in (or attempted to initiate) a trading receivership, (k) such other matters as the process adviser considers relevant in the circumstances. (5) The process adviser shall— (a) hold a meeting with the directors of the eligible company for the purpose of informing the directors of the determination and the reasons for it, and (b) give the directors of the eligible company confirmation in writing of the determination and the reasons for it. Process adviser to prepare report 558D. (1) This section applies where the process adviser determines under section 558C that there is a reasonable prospect of the survival of the eligible company, and the whole or any part of its undertaking, as a going concern. (2) The process adviser shall— (a) prepare a report relating to the eligible company specifying the matters set out in subsection (3), and (b) submit a copy of the report to the directors of the eligible company. (3) The matters referred to in subsection (2)(a) are— (a) that the company is an eligible company which meets the conditions in section 558B(2), (b) the names and addresses of the officers of the eligible company, (c) the names of any other bodies corporate of which the directors of the eligible company are also directors, (d) a statement as to the affairs of the eligible company, showing— (i) in so far as it is reasonably practicable to do so, particulars of the eligible company’s assets and liabilities (including contingent and prospective liabilities) as at the latest practicable date, (ii) the names and addresses of its creditors, (iii) the securities held by each of them, and (iv) the dates when the securities were given to each of them, (e) the process adviser’s opinion as to whether any deficiency between the assets and liabilities of the eligible company has been satisfactorily accounted for or, if not, as to whether there is evidence of a substantial dissipation of property that is not adequately accounted for, (f) a statement of the conditions or other matters which the process adviser considers are essential to ensure that the eligible company, and the whole or any part of its undertaking, would have a reasonable prospect of survival as a going concern, whether as regards the internal management and controls of the company or otherwise, (g) the process adviser’s opinion as to whether the preparation, approval and taking effect of a rescue plan would offer a reasonable prospect of the survival of the eligible company, and the whole or any part of its undertaking, as a going concern, (h) the process adviser’s opinion as to whether an attempt to continue the whole or any part of the undertaking would be likely to be more advantageous to the members as a whole and the creditors as a whole than a winding up of the eligible company, (i) recommendations as to the course the process adviser thinks should be taken and the matters the process adviser thinks should be taken into account in relation to the eligible company including, if warranted, a draft of a rescue plan, (j) details of the extent of the funding required to enable the eligible company to continue trading during the rescue period and the sources of that funding, (k) the process adviser’s recommendations as to which liabilities incurred before the appointment of a process adviser should be paid, (l) information about how this Part operates and its general effect, including information about the process of appointing a process adviser and potential costs and fees, (m) the process adviser’s recommendation as to which court should be the relevant court for the purposes of any proceedings under this Part relating to the eligible company, (n) such other matters as the process adviser thinks relevant, and (o) such other matters as may be prescribed. Chapter 3 Appointment of process adviser Resolution to appoint process adviser 558E. (1) This section applies where a process adviser submits a report under section 558D(2)(b) to the directors of an eligible company. (2) The directors of the eligible company may call a meeting of its board of directors at which a resolution to appoint a process adviser in respect of the eligible company shall be proposed and considered. (3) Any meeting called under subsection (2) shall be held before the expiry of the period of 7 days beginning on the date on which the directors of the eligible company receive the process adviser’s report. Process adviser’s duty to keep determination under section 558C under review 558F. (1) This section applies where a process adviser is appointed in respect of an eligible company and is without prejudice to section 558S(2). (2) The process adviser shall keep under review during the rescue period the determination made in relation to the eligible company under section 558C. (3) If, at any time during the rescue period, the process adviser determines, having regard to the matters specified in subsection (4), that there is no longer a reasonable prospect of the survival of the eligible company, and the whole or any part of its undertaking, as a going concern, the process adviser shall immediately— (a) give notice of the determination to the directors of the eligible company, and (b) resign as process adviser in respect of the eligible company in accordance with section 558ZW. (4) The matters referred to in subsection (3) are— (a) any material change in the circumstances of the eligible company, (b) the discovery of any material inaccuracy in the information provided to the process adviser that was relied upon for the determination under section 558C, or (c) such other matter as the process adviser considers relevant. Duties of directors of eligible company in relation to process adviser 558G.(1) This section applies where a process adviser is appointed in respect of an eligible company. (2) Where the process adviser gives notice to the directors of the eligible company under section 558F, the directors shall, as soon as reasonably practicable after the notice is given, take such steps as they consider appropriate for the purpose of protecting the interests of employees of the company. (3) During the rescue period, the directors of the eligible company shall— (a) co-operate with the process adviser for any purpose relating to the performance by the process adviser of his or her functions under this Part, and (b) without prejudice to any other requirement imposed on them by or under this Part, disclose to the process adviser any information relating to the performance of those functions that is available to them. Process adviser’s duty to determine relevant court 558H. (1) This section applies where a process adviser is appointed in respect of an eligible company. (2) The process adviser shall, having regard to the matters mentioned in subsection (3), determine whether any proceedings under this Part relating to the eligible company shall be brought in the Circuit Court or the High Court. (3) The matters referred to in subsection (2) are— (a) the need to minimise costs by refraining from bringing proceedings in the High Court unless there are good reasons for doing so, (b) the need for an efficient and expeditious conclusion to any proceedings brought under this Part, and (c) any other relevant matter. (4) Before making a determination under subsection (2), the process adviser shall consult the directors of the eligible company. (5) The jurisdiction of the Circuit Court under this Part in relation to an eligible company shall be exercisable by a judge of the Circuit Court— (a) for the circuit in which the registered office of the eligible company is situated at the time of the appointment of the process adviser or in which it has, at that time, its principal place of business, or (b) if, at that time, there is no registered office of the eligible company and its principal place of business is outside the State, for the Dublin Circuit. Process adviser’s duty to seek provision of email addresses 558I. (1) This section applies where a process adviser is appointed in respect of an eligible company by virtue of the passing of a resolution referred to in section 558E(2). (2) As soon as practicable after the appointment, the process adviser shall give to each person specified in subsection (3) a notice in writing— (a) requesting that the person provide the process adviser with an email address that the process adviser may use for the purpose of giving the person any notices and other documents that the process adviser is required or authorised to give to the person under this Part, and (b) informing each such person that, if no email address is provided, the process adviser shall give the person those notices and other documents by sending them by post in accordance with section 558ZAI. (3) Notice under subsection (2) shall be given— (a) where the process adviser is aware of the person’s email address, by electronic means to that email address, or (b) in any other case, in accordance with section 558ZAI(4). (4) The persons are— (a) employees of the eligible company, (b) members of the eligible company, (c) creditors of the eligible company, (d) the Revenue Commissioners, and (e) such other persons as may be prescribed. (5) The process adviser shall keep records and supporting evidence of the means by which notice is given under this section. Process adviser to give notice of appointment 558J. (1) This section applies where a process adviser is appointed in respect of an eligible company by virtue of the passing of a resolution referred to in section 558E(2). (2) The process adviser shall, as soon as practicable and in any event no later than 2 working days after the passing of the resolution— (a) deliver to the Registrar a notice of his or her appointment in the prescribed form, and (b) file with the office of the relevant court a copy of— (i) the resolution, (ii) the process adviser’s determination made under section 558C and his or her report prepared under section 558D, and (iii) where a process adviser has determined under section 558H(2) that proceedings under this Part in relation to an eligible company should be brought in the High Court, the reasons for the determination, and (c) make arrangements for a notice of his or her appointment and the date of that appointment to be published in Iris Oifigiúil. (3) The directors of the eligible company shall ensure that, within 48 hours after the passing of the resolution, a notice in the prescribed form stating that the process adviser has been appointed and the date of the appointment is placed on any website of the company in a prominent and easily accessible place. (4) The directors of the eligible company shall ensure that the notice referred to in subsection (3) remains on the website during the rescue period. (5) The process adviser shall keep records and supporting evidence of the means by which he or she has complied with the requirement imposed by subsection (2)(c). (6) A person who fails to comply with a requirement imposed by this section shall be guilty of a category 3 offence. Process adviser to give notice to employees, creditors, etc. 558K. (1) This section applies where a process adviser is appointed in respect of an eligible company by virtue of the passing of a resolution referred to in section 558E(2). (2) The process adviser shall, as soon as practicable and in any event no later than 5 days after the passing of the resolution, give to the persons specified in subsection (3)— (a) a notice in the prescribed form setting out— (i) the fact of his or her appointment as process adviser and the date of the passing of the resolution in respect of same, (ii) any payments that the process adviser considers are required to be made in order for the eligible company to continue trading, (iii) the fact that any liabilities arising after the appointment of the process adviser that are properly incurred by the process adviser under this Part shall be paid in full, and (iv) the determination made under section 558H(2) as to whether any proceedings shall be brought in the Circuit Court or the High Court, as the case may be, (b) in a case where the person is a creditor of the eligible company, a notice requiring the person to provide the process adviser with information about the matters set out in subsection (4), (c) in a case where the person is a party to a contract to which section 558P applies and the process adviser is considering repudiating the contract, a statement of that fact, and (d) copies of— (i) the determination made under section 558C and the report prepared under section 558D, and (ii) such other documents as may be prescribed. (3) The persons referred to in subsection (2) are— (a) employees of the eligible company, (b) creditors of the eligible company, (c) the Revenue Commissioners, and (d) such other persons as may be prescribed. (4) The matters referred to in subsection (2)(b) are— (a) the nature of the person’s claim, (b) the nature of any evidence supporting the claim, (c) any credit terms offered by the person to the eligible company, (d) any security held by the person over any assets of the eligible company, (e) any related party transactions with the eligible company, (f) any other matter that the person considers to be relevant for the purposes of the preparation of a rescue plan in accordance with section 558Q, and (g) such other matters as may be prescribed. (5) The process adviser shall keep records and supporting evidence of the means by which notice is given under this section. (6) A process adviser who fails to comply with any requirement imposed by this section shall be guilty of a category 3 offence. (7) In this section, ‘related party transaction’ means a transaction between an eligible company and its related party. Notice to creditor where eligible company has excludable debt 558L. (1) This section applies where— (a) a process adviser is appointed in respect of an eligible company by virtue of the passing of a resolution referred to in section 558E(2), and (b) the eligible company has an excludable debt. (2) As soon as practicable after the passing of the resolution, the process adviser shall give a notice to the creditor concerned requiring the creditor to inform the process adviser, within 14 days after the giving of the notice, if the creditor objects to the inclusion of the excludable debt in the rescue plan on any of the grounds specified in subsection (3). (3) The grounds are— (a) the eligible company has failed at any time to comply with a requirement relating to tax imposed by or under— (i) this Act, or (ii) any other enactment, (b) the Revenue Commissioners are conducting an audit or intervention into the eligible company, (c) the eligible company is a party to an appeal in relation to a requirement relating to tax imposed by this Act or any other enactment, or (d) such other ground as may be prescribed. (4) In this section, ‘excludable debt’, in relation to an eligible company, means— (a) any liability of the eligible company arising out of any tax, duty, levy or other charge of a similar nature owed or payable to the State, (b) any debt or liability of the eligible company arising under the Redundancy Payments Acts 1967 to 2014, (c) any debt or liability of the eligible company arising under the Protection of Employees (Employers’ Insolvency) Acts 1984 to 2020, (d) any debt or liability of the eligible company arising under the Social Welfare Consolidation Act 2005 , or (e) any debt or liability of the eligible company arising under such other enactment as may be prescribed. Relevant court’s powers where receiver or provisional liquidator previously appointed 558M. (1) This section applies where a process adviser is appointed in respect of an eligible company by virtue of the passing of a resolution referred to in section 558E(2). (2) Subsection (3) applies where, at the date of the passing of the resolution— (a) a receiver stands appointed to the whole or any part of the property or undertaking of the eligible company, but (b) the receiver has not stood so appointed for a continuous period of 3 working days or more. (3) On an application by the eligible company or the process adviser for direction as to the effect of the appointment of the process adviser on the appointment of the receiver, the relevant court (or, if the receiver was appointed by the High Court, the High Court only) may make such order as it thinks fit, including an order as to any or all of the following matters: (a) that the receiver shall cease to act as such from a date specified by the relevant court; (b) that the receiver shall, from a date specified by the relevant court, act as such only in respect of certain assets specified by the relevant court; (c) directing the receiver to deliver all books, papers and other records, which relate to the property or undertaking of the eligible company (or any part of it) and are in his or her possession or control, to the process adviser within a period to be specified by the relevant court; (d) directing the receiver to give the process adviser full particulars of all his or her dealings with the property or undertaking of the eligible company. (4) The relevant court shall not make an order under subsection (3)(a) or (b) unless the relevant court is satisfied that there is a reasonable prospect of the survival of the eligible company, and the whole or any part of its undertaking, as a going concern. (5) Where the relevant court makes an order under subsection (3), it may, for the purpose of giving full effect to the order, include such conditions in the order and make such ancillary or other orders as it deems fit. (6) Subsection (7) applies where, at the date of the passing of the resolution, a provisional liquidator stands appointed to the eligible company. (7) On an application by the eligible company or the process adviser for direction as to the effect of the appointment of the process adviser on the appointment of the provisional liquidator, the High Court may make such order as it thinks fit, including an order as to any or all of the following matters— (a) that the provisional liquidator shall cease to act as such from a date specified by the High Court, (b) directing the provisional liquidator to deliver all books, papers and other records, which relate to the property or undertaking of the eligible company (or any part of it) and are in his or her possession or control, to the process adviser within a period to be specified by the High Court, (c) directing the provisional liquidator to give the process adviser full particulars of all his or her dealings with the property or undertaking of the eligible company. (8) The High Court shall not make an order under subsection (7), unless the High Court is satisfied that there is a reasonable prospect of the survival of the eligible company, and the whole or any part of its undertaking, as a going concern. (9) Where the High Court makes an order under subsection (7), it may, for the purpose of giving full effect to the order, include such conditions in the order and make such ancillary or other orders as it deems fit. (10) An application under this section shall be made on notice to the creditors of the eligible company. (11) Where the receiver was appointed by the High Court, references in subsections (3) to (5) to the relevant court shall be construed as references to the High Court. Relevant court’s power to stay proceedings or restrain further proceedings 558N. (1) This section applies where a process adviser is appointed in respect of an eligible company. (2) Where the relevant court is satisfied that, having regard to the report prepared under section 558D and such other matters as it sees fit, there is a reasonable prospect of the survival of the eligible company, and the whole or any part of its undertaking, as a going concern, it may, on the application of any of the persons specified in subsection (3)— (a) stay all proceedings or restrain any further proceedings against the eligible company for the relevant period on such terms as seem just, or (b) order that the provisions set out in subsection (4), or such other provision as the relevant court may specify, shall have effect in relation to the eligible company for the relevant period. (3) The persons referred to in subsection (2) are— (a) the eligible company, (b) the directors of the eligible company, and (c) the process adviser. (4) The provisions referred to in subsection (2)(b) are as follows, namely: (a) no proceedings for the winding up of the eligible company may be commenced or resolution for winding up passed in relation to the company and any resolution so passed shall have no effect; (b) no receiver over any part of the property or undertaking of the eligible company shall be appointed or, if a receiver has been so appointed before the appointment of the process adviser in respect of the company, the receiver shall, subject to any order under section 558M, cease to act; (c) no attachment, sequestration, distress or execution shall be put into force against the property or effects of the eligible company, except with the consent of the process adviser; (d) where any claim against the eligible company is secured by a mortgage, charge, lien or other encumbrance or a pledge of, on or affecting the whole or any part of the property, effects or income of the company, no action may be taken to realise the whole or any part of that security, except with the consent of the process adviser; (e) no steps may be taken to repossess goods in the eligible company’s possession under any hire-purchase agreement (within the meaning of section 558ZV), except with the consent of the process adviser; (f) where, by or under any enactment, rule of law or otherwise, any person other than the eligible company is liable to pay all or any part of the debts of the company— (i) no attachment, sequestration, distress or execution shall be put into force against the property or effects of such person in respect of the debts of the eligible company, and (ii) no proceedings of any sort may be commenced against such person in respect of the debts of the eligible company; (g) no order for relief shall be made under section 212 against the eligible company in respect of complaints as to the conduct of the affairs of the company or the exercise of the powers of the directors— (i) prior to the passing of the resolution appointing the process adviser in respect of the eligible company, or (ii) on or after the passing of such resolution; (h) no proceedings for the appointment of an examiner to the eligible company may be brought. (5) An application under subsection (2) shall be made on notice to all interested parties and other persons directly affected. (6) The relevant court shall not stay or restrain proceedings or make an order under subsection (2) without having afforded each creditor of the eligible company who has indicated to the court his or her desire to be heard in the matter an opportunity to be so heard. (7) In this section, ‘relevant period’, in relation to an eligible company, means— (a) the rescue period, or (b) such other period as the relevant court sees fit. Requirements following giving of notice to creditor under section 558K 558O. (1) This section applies where the process adviser appointed in respect of an eligible company gives a creditor of the company a notice under section 558K(2)(b). (2) Where the creditor receives the notice, he or she shall— (a) within 7 days of receipt of the notice, acknowledge receipt of such notice in writing, and (b) within 14 days of receipt of the notice, provide the process adviser with the information required by the notice. (3) Where a creditor fails to comply with subsection (2)(a), the process adviser shall give a notice (a ‘reminder notice’) to the creditor requiring the creditor, within 72 hours of receipt of the reminder notice, to acknowledge receipt of the notice given under section 558K(2)(b). (4) Where a creditor fails to comply with a reminder notice, the creditor shall be deemed to have received the notice given under section 558K(2)(b). (5) Where a creditor fails to comply with subsection (2)(b), the process adviser shall— (a) estimate the value of the creditor’s claim (any such value being referred to in this subsection as ‘the estimated value’), and (b) give a notice to the creditor— (i) specifying the estimated value, and (ii) informing the creditor that, unless the creditor supplies the process adviser with the information required by the notice under subsection (2)(b) within 72 hours after the giving of the notice under this subsection, the estimated value may be used by the process adviser for the purposes of preparing a rescue plan under section 558Q. (6) In estimating the value of a claim under subsection (5)(a), the process adviser shall take into account any information relating to the claim contained in the books and documents of the eligible company that are available to him or her. (7) The process adviser shall keep records and supporting evidence of the means by which a reminder notice was given. (8) A person who fails to comply with subsection (3) or (7) shall be guilty of a category 3 offence. Repudiation, affirmation and variation of certain contracts 558P. (1) This section applies where— (a) a process adviser is appointed in respect of an eligible company, and (b) the eligible company is a party to a contract (a ‘relevant contract’) under which some element of performance other than payment remains to be rendered both by the company and the other contracting party or parties (such party or parties being referred to in this section as the ‘relevant person’). (2) The process adviser shall consider, having regard in particular to the matters specified in subsection (3), whether it is necessary for the survival of the eligible company, and the whole or any part of its undertaking, as a going concern, that the relevant contract be repudiated. (3) The matters referred to in subsection (2) are as follows, namely: (a) whether repudiation of the relevant contract would be likely to be more advantageous for the relevant person than a winding up of the eligible company or receivership; (b) whether, if not repudiated, the relevant contract would be burdensome to, and surplus to the requirements of, the eligible company; (c) whether the process adviser would be able to prepare a rescue plan if the contract were not repudiated. (4) Where, having complied with subsection (2), the process adviser proposes to repudiate the relevant contract, the process adviser shall— (a) subject to the approval of the relevant court, repudiate the relevant contract, or (b) subject to subsection (11), where the process adviser considers that it would be appropriate to do so in all the circumstances, comply with subsections (7) to (10) instead of applying to the relevant court under subsection (5) in pursuance of paragraph (a). (5) On the application of the process adviser in pursuance of subsection (4)(a), the relevant court— (a) may, if satisfied that the condition in subsection (6) is met— (i) approve the repudiation of the relevant contract with effect from the day on which the rescue plan takes effect under section 558ZB or 558ZE, as the case may be, and (ii) determine the amount of any loss or damage suffered by the relevant person as a result of the repudiation, or (b) shall, if not so satisfied, dismiss the application. (6) The condition referred to in subsection (5) is that it is necessary for the survival of the eligible company, and the whole or any part of its undertaking, as a going concern, that the relevant contract be repudiated. (7) In any case where subsection (4)(b) applies, the process adviser shall give a notice to the relevant person— (a) informing the relevant person that the process adviser proposes to repudiate the relevant contract, (b) setting out the reasons why the process adviser considers that it is necessary for the survival of the eligible company, and the whole or any part of its undertaking, as a going concern that the relevant contract be repudiated, (c) informing the relevant person that, in the event of repudiation of the relevant contract, the relevant person would stand as an unsecured creditor for the amount of loss or damage suffered by the relevant person as a result of the repudiation, (d) specifying the terms on which the process adviser proposes to repudiate the contract (including the amount of any loss or damage suffered by the relevant person as a result of the repudiation, as determined by the process adviser), (e) informing the relevant person that the relevant person has a right to participate in any meeting held under section 558T, (f) informing the relevant person that, in the event that a rescue plan including provision for the repudiation of the relevant contract is approved at such a meeting, the relevant person would have a right under section 558ZC (subject to any application to the relevant court under subsection (5)) to object to— (i) the repudiation, and (ii) the amount determined in respect of any loss or damage, (g) offering the relevant person an opportunity to propose to the process adviser— (i) modifications of the terms on which the relevant contract would be repudiated, or (ii) a variation of the terms of the relevant contract in order to avoid the repudiation of the relevant contract, (h) in any case where the process adviser considers it appropriate to do so, offering the relevant person a variation of the terms of the relevant contract in order to avoid repudiation of the relevant contract, (i) informing the relevant person that— (i) the repudiation of the relevant contract, or (ii) any variation of the terms of the relevant contract agreed by the process adviser and the relevant person in pursuance of paragraph (h), would take effect on the coming into effect of the rescue plan in accordance with this Part, and (j) requesting that the relevant person respond to the notice within a reasonable period (being, except where a shorter period is agreed, at least 10 days after the date on which notice is given) after the giving of the notice. (8) Where— (a) the relevant person proposes any modifications under subsection (7)(g), the process adviser shall consider the modifications and may— (i) include in the rescue plan provision repudiating the relevant contract on the terms agreed between the process adviser and the relevant person, or (ii) reject the modifications proposed by the relevant person and give the relevant person a notice under subsection (9), (b) the process adviser and the relevant person agree on a variation of the terms of the relevant contract, include in the rescue plan provision affirming the relevant contract subject to that variation, or (c) the relevant person— (i) objects to the proposed repudiation of the contract and does not offer any modifications, or (ii) fails to respond to the notice given under subsection (7) within the period specified in it, the process adviser shall give the relevant person a notice under subsection (9). (9) Where the process adviser considers that the relevant contract should be repudiated, the process adviser shall give a notice to the relevant person— (a) informing the relevant person that the process adviser shall include in the rescue plan provision repudiating the relevant contract, (b) informing the relevant person that the repudiation will take effect on the date (if any) on which the rescue plan takes effect in accordance with the provisions of this Part, (c) specifying the amount determined by the process adviser in respect of loss or damage arising from such repudiation, (d) informing the relevant person that the relevant person has a right to participate in any meeting held under section 558T, and (e) informing the relevant person that, in the event that a rescue plan including provision for the repudiation of the relevant contract is approved at such a meeting, the relevant person has a right under section 558ZC to object to— (i) the repudiation of the relevant contract, and (ii) the amount determined in respect of loss or damage. (10) Where the relevant contract is a lease, the process adviser shall assess loss or damage for the purposes of any calculation under subsection (7)(d) or (9)(c) by reference to the following— (a) income shortfall, (b) letting void, (c) letting rent-free, (d) reletting costs, (e) marketing costs, and (f) any other losses or costs that may arise. (11) In any case where the process adviser is complying with the requirement imposed by subsection (4)(b), the process adviser may at any time cease complying with that subsection (and subsections (7) to (10)) and comply instead with the requirement imposed by subsection (4)(a). (12) Where by virtue of subsection (4) the relevant contract is repudiated, the relevant person shall stand as an unsecured creditor for the amount of loss or damage suffered as a result of the repudiation. (13) Any amount payable by the eligible company to the relevant person in respect of any loss or damage suffered by the relevant person as a result of the repudiation of a relevant contract which is— (a) determined by the relevant court under subsection (5)(a)(ii), or (b) included in the rescue plan by virtue of this section, shall be due by the eligible company to the relevant person as a judgment debt. (14) The relevant person has a right to participate in any meeting held under section 558T notwithstanding any approval given by the relevant court under subsection (5)(a). (15) Where the process adviser wishes to affirm the relevant contract (other than under subsection (8)(b))— (a) he or she shall apply to the relevant court, and (b) the relevant court may approve the affirmation by the process adviser of the relevant contract. (16) Where the relevant court approves the repudiation or affirmation of a relevant contract under subsection (5) or (15) or by virtue of section 558ZD(11), it may, in giving such approval, make such orders as it thinks fit for the purposes of giving full effect to its approval, including orders as to notice to, or declaring the rights of, any party affected by such affirmation or repudiation. (17) For the avoidance of doubt, a process adviser shall have authority on behalf of the eligible company to repudiate or affirm (with or without variation) a relevant contract in pursuance of the provisions of this section. Chapter 4 Rescue plan Process adviser’s duty to prepare rescue plan 558Q. (1) This section applies where a process adviser is appointed in respect of an eligible company by virtue of the passing of a resolution referred to in section 558E(2). (2) As soon as practicable after the passing of the resolution, the process adviser shall prepare a rescue plan for the eligible company. (3) In preparing the rescue plan, the process adviser shall take account of— (a) any information provided by creditors by virtue of section 558K(2)(b) or 558O(2)(b), and (b) where no such information is provided, any values of claims that the process adviser has estimated under section 558O(5). (4) Where— (a) the process adviser has given a notice to a creditor under section 558L in respect of an excludable debt, and (b) the creditor concerned has not informed the process adviser of an objection within the time specified in the notice, the process adviser shall include the excludable debt in the rescue plan. (5) Where the process adviser has given a notice to a person under section 558P(9) in respect of a contract, the process adviser shall include in the rescue plan provision repudiating the contract unless it appears to the process adviser that circumstances have changed since the notice was given and it would no longer be appropriate to do so. (6) The rescue plan shall— (a) specify each class of members and creditors of the eligible company, (b) specify any class of members and creditors whose interests or claims will not be impaired by the rescue plan, (c) specify any class of members and creditors whose interests or claims will be impaired by the rescue plan, (d) provide equal treatment for each claim or interest of a particular class unless the holder of a particular claim or interest agrees to less favourable treatment, (e) if the process adviser considers it necessary or desirable to do so in order to facilitate the survival of the eligible company, and the whole or any part of its undertaking, as a going concern, specify any changes that should be made in relation to the management or direction of the company, (f) if the process adviser considers it necessary or desirable to do so in order to facilitate such survival, specify any changes that he or she considers should be made in the constitution of the eligible company, whether as regards the management or direction of the company or otherwise, (g) provide for its implementation (including any changes specified under paragraphs (e) and (f)) and the time within which it is to be implemented, and (h) include such other matters as the process adviser deems appropriate. (7) A director who fails, without lawful excuse, to implement any provision of the rescue plan which takes effect and which imposes a requirement on the directors of the eligible company within the time for implementing the rescue plan specified under subsection (6)(g) shall be guilty of a category 3 offence. Further provision with respect to leases 558R. (1) Subject to subsection (3), a rescue plan for an eligible company shall not contain provision that provides for either or both of the following— (a) a reduction in the amount of any rent or other periodical payment reserved under a lease of land that falls to be paid after the date from which the rescue plan would come into effect under section 558ZB or 558ZE, as the case may be, or the complete extinguishment of the right of the lessor to any such payments; (b) as respects a failure— (i) to pay an amount of rent or make any periodical payment reserved under a lease of land, or (ii) to comply with any other covenant or obligation of such a lease, that falls to be paid or complied with after the date referred to in paragraph (a), a requirement that the lessor under such a lease shall not exercise, or shall only exercise in specified circumstances, any right, whether under the lease or otherwise, to— (I) recover possession of the land concerned; (II) effect a forfeiture of the lease or otherwise enter on the land; (III) recover the amount of such rent or other payment; or (IV) claim damages or other relief in respect of the failure to comply with such a covenant or obligation. (2) Subsection (1) shall not apply if the lessor or owner of the property concerned has consented in writing in the prescribed form to the inclusion of the provision referred to in subsection (1) in the rescue plan. Procedure where process adviser unable to prepare rescue plan 558S. (1) This section applies where the process adviser appointed in respect of an eligible company is unable to prepare a rescue plan for the company. (2) As soon as practicable after the process adviser becomes aware of that fact, the process adviser shall— (a) prepare a report setting out the matters specified in subsection (3), (b) give a copy of the report to the directors of the eligible company, and (c) give notice of that fact to— (i) employees of the eligible company, (ii) members of the eligible company, (iii) creditors, and (iv) the Revenue Commissioners. (3) The matters referred to in subsection (2)(a) are— (a) the reasons why a rescue plan could not be prepared for the eligible company, and (b) recommendations as to the next steps to be taken by the directors of the eligible company (including the winding up of the company). (4) The recommendations of the process adviser referred to in subsection (3)(b) shall not be binding on the eligible company or the directors of the company. (5) Notwithstanding subsection (4), where— (a) the process adviser recommends that the eligible company be wound up, (b) the directors of the eligible company decide that the company should continue to trade, (c) the eligible company continues to trade in pursuance of that decision, and (d) within 6 months of that decision the eligible company is wound up, the court may take that decision into account for the purposes of any application under section 610. Chapter 5 Consideration of rescue plan Process adviser’s duty to call meeting of members and creditors 558T. (1) This section applies where a process adviser has prepared a rescue plan under section 558Q. (2) As soon as practicable after preparing the rescue plan, the process adviser shall call— (a) the appropriate meetings of the creditors or the class concerned of them, and (b) the appropriate meetings of the members or the class concerned of them, for the purpose of considering the rescue plan. (3) References in subsection (2) to the appropriate meetings of creditors or members as the case may be, are references to either— (a) separate meetings of the particular creditors or members (as appropriate) who fall into the separate classes that, under the general law, are required to be constituted for the purpose of voting on the rescue plan, or (b) where, under the general law, no such separate classes are required to be constituted for that purpose, a single meeting of the creditors or members (as appropriate). (4) A meeting under this section shall be fixed for a date no later than 49 days after the date on which the process adviser is appointed. (5) A meeting under this section shall be held at such place as is, in the opinion of the process adviser, the most convenient for the majority of the members or creditors or all, as the case may be. (6) Different times or places may be named for the meetings of members and for those of creditors. (7) Where an excludable debt is included in the rescue plan, the creditor concerned shall be entitled to vote at any meeting called under this section. Notice of meeting under section 558T 558U. (1) This section applies where a process adviser calls a meeting under section 558T. (2) The process adviser shall, at least 7 days before the day appointed for the meeting, give notice in writing in the prescribed form to every person entitled to attend the meeting of the time and place appointed for the meeting. (3) Notice under this section shall be accompanied by— (a) the rescue plan prepared under section 558Q, (b) a statement of the assets and liabilities (including contingent and prospective liabilities) of the eligible company as at the date on which the rescue plan was prepared under that section, (c) a description of the likely financial outcome of a winding up of the eligible company or of the application of a receivership to that company for each class of members and creditors, (d) a statement by the process adviser explaining— (i) the effect of the rescue plan, (ii) the reasons why it is fair and equitable and not unfairly prejudicial, (iii) the likely consequences of a failure to approve the rescue plan (including winding up or receivership), and (iv) where appropriate, the process adviser’s views on the likely outcome for creditors if the eligible company were to be wound up, (e) information about any changes in the management or direction of the eligible company that are specified in the rescue plan, (f) a statement outlining any material interests of the directors of the eligible company and the effect of the rescue plan to the extent it is different to like interests of other persons, (g) information about the procedure for agreeing to, proposing modifications to or objecting to the rescue plan at the meeting, (h) a general and a special form of proxy (with neither the name nor description of the process adviser or any other person printed or inserted in the body of any such instrument of proxy), (i) a statement setting out— (i) the remuneration payable to, and the costs and expenses incurred by, the Chapter 2 process adviser under this Part, and (ii) the remuneration payable to, and the costs and expenses incurred by, the process adviser appointed in respect of the eligible company by virtue of the passing of a resolution mentioned in section 558E(2) under this Part during the relevant period, (j) an estimate of the additional remuneration that would be payable to, and the costs and expenses that would be incurred by, the process adviser under this Part if the rescue plan were to be approved pursuant to section 558ZB, (k) an estimate of the additional remuneration that would be payable to, and the costs and expenses that would be incurred by, the process adviser under this Part if the rescue plan were not to be approved pursuant to section 558ZB, and (l) such other documents and information as may be prescribed. (4) The process adviser shall keep records and supporting evidence of the means by which notice is given to persons under this section. (5) The proceedings at the meeting shall, unless the relevant court otherwise orders, be valid notwithstanding the fact that any member or creditor fails to receive notice of the meeting for any reason, unless the relevant court considers that the member or creditor has been materially prejudiced by that failure. (6) In this section— ‘Chapter 2 process adviser’, in relation to an eligible company, means the person who performed the duties imposed on a process adviser by Chapter 2 of this Part in respect of the company; ‘relevant period’, in relation to a process adviser, appointed in respect of an eligible company by virtue of the passing of a resolution mentioned in section 558E(2), means the period— (a) beginning with the date of the passing of the resolution, and (b) ending on the date on which the rescue plan is prepared under section 558Q. (7) A person who fails to comply with this section shall be guilty of a category 3 offence. Proceedings at meeting under section 558T 558V. (1) This section applies in relation to a meeting called by the process adviser under section 558T. (2) The process adviser or, if the process adviser is unable to act, someone nominated by him or her shall be chairperson. (3) The chairperson may, with the consent of the meeting, adjourn it from time to time and from place to place but the adjourned meeting shall be held at the same place as the original meeting unless in the resolution for adjournment another place is specified. (4) The chairperson of the meeting shall cause— (a) minutes of the proceedings at the meeting to be drawn up and entered in a book kept for that purpose and signed by him or her, and (b) a list of members or creditors present at the meeting to be made and kept in such form as may be prescribed and such list shall be signed by him or her. (5) Other than on the matter of an adjournment, a meeting may not act for any purpose, unless there are present or represented at the meeting— (a) where only one meeting of members and one meeting of creditors requires to be held by virtue of section 558T— (i) at least 2 members, and (ii) at least 3 creditors entitled to vote or all the creditors entitled to vote if the number entitled to vote shall not exceed 3, or (b) where separate meetings require to be held by virtue of that section in respect of members and creditors (or any class of members or creditors)— (i) in the case of a meeting of members, at least 2 members, or (ii) in the case of a creditors’ meeting, at least 3 creditors entitled to vote or all the creditors entitled to vote if the number entitled to vote shall not exceed 3. (6) If within 30 minutes from the time appointed for the meeting a quorum of members or creditors, as the case may be, is not present or represented, the meeting shall be adjourned to the same day in the following week at the same time and place or to such other day or time or place as the chairperson may appoint. (7) However, the day so appointed by the chairperson shall be not less than 4 nor more than 10 days after the day from which the meeting was adjourned. (8) A person who fails to comply with subsection (4)(a) or (b) shall be guilty of a category 3 offence. Proxies 558W. (1) This section applies where the process adviser appointed in respect of an eligible company calls a meeting of the members and creditors of the company under section 558T. (2) A member or creditor of the eligible company may vote either in person or by proxy. (3) An instrument of proxy shall be in the prescribed form. (4) A member or a creditor may appoint any person a special proxy to vote at the meeting or any …