Virtual Creditors Meetings
The Insolvency Service has been keen to cut the costs of insolvency to allow a better return for creditors. Following the adoption of new technology and digital advances, virtual meetings are the new replacement to the more traditional office-based meetings, creditors would have had in the past. This change happened in 2016, when the details of Section 98 of The Insolvency Act 1986 were updated.
There are two key meetings where virtual meetings are used. More information can be found on our page regarding a Section 98 Creditors Meetings
Firstly, the shareholders and company members will discuss with the liquidators upon a resolution for putting the company into liquidation. This is most usually an office based, face to face meeting, however it can be done by a virtual meeting if needed.
Secondly a virtual meeting can be held when the licensed insolvency practitioner discusses with the creditors, the company’s financial position and the statement of affairs going forward. Many creditors may be owed money and so be involved in the liquidation process. To make it easier, as it was often too expensive or too difficult to get all the creditors together at once, in one place, as they often travel from afar – virtual meetings have been made. These allow creditors to all communicate via an online mechanism (usually by GoToMeeting or Skype For Business), where they can engage from their own workspace – so less disruption is made and so more attendees are available. This allows all creditors to place their input, share information and ask any further questions they have regarding the situation.
From April 2017 though a physical meeting of creditors will not be summoned unless this is explicitly requested by at least the following;
- 10% by value of creditors or
- 10% in total number of creditors or
- 10 individual creditors