Receivership Services

These options, either Administrative Receivership or Fixed Charge Receivership, are available where a secured creditor holds a charge over the assets of the company.

Administrative Receivership

The process of Administrative Receivership is instigated by a secured creditor, such as a bank or other primary finance provider, who holds a qualifying floating charge (registered before 15 September 2003) over the assets of the company. Where a company has defaulted on the terms of the charge, the charge holder can appoint an insolvency practitioner (known as an Administrative Receiver).

An Administrative Receiver is appointed with the principal function of securing the best outcome for the charge holder, albeit retaining a duty of care to the remaining creditors of the company. The Administrative Receiver’s powers are contained within the Insolvency Act 1986 and are often then extended by the terms of the debenture to allow the Administrative Receiver to manage and trade the company with a view to achieving its sale. At UHY Hacker Young we have extensive experience in the area of Administrative Receivership and can work with you throughout the process.

Fixed Charge Receivership

Fixed Charge Receivership is a process instigated by a secured creditor, such as a bank or other primary finance provider, who holds a fixed charge over specific assets of the company. This will often be land and buildings, although can also relate to specific plant and machinery and other tangible assets or book debts.

Where a company has defaulted on the terms of the charge, the charge holder can appoint an insolvency practitioner (known as an Administrative Receiver) as a Fixed Charge Receiver. If the charge relates to property then the Receiver is usually appointed under the Law of Property Act (1925) and is referred to as an LPA Receiver.

Unlike Administrative Receivership, appointments of an LPA Receiver are not made under the Insolvency Act 1986. The LPA Receiver’s powers are set out in the charge document and their primary focus is on collecting income received from the charged asset and, if the charge document allows, to dispose of the charged asset, for the benefit of the charge holder.

The next step

If you think your business may be at risk of receivership please contact one of the members of our team who will help you determine the best course of action.