Purnells

	Two types of CVA
	what are the two types? why two types? who can apply for a new type of CVA? are their different rules? when would an old type CVA be used? when would a new type of CVA be used?
	Old type CVA - No Moratorium the limbo period nominees duties disclosure issues directors duties the proposal impact of proposal on various parties
	New type CVA - With Moratorium enormous power enormous responsibility disclosure issues impact of proposal nominees duties creditors meeting voting rights supervisors duties a typical proposal costs concluding the CVA banks and debenture holders landlords petitioning creditors preferential creditors unsecured creditors
	Table of differences table to show the differences between the two types of CVA?
	Administration Order v CVA when would administration be sought rather than take up a new type CVA?
	Case Studies case study 1 case study 2 case study 3

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Since the new type CVA grants a moratorium period, which prevents creditors taking enforcement action. It has many similarities with the impact of an administration order.

When would one or other route be followed?

1. The new type CVA will only be available to "small" companies. (The definition of a "small" company can be found by clicking here)

If the company is large, therefore then to seek protection from creditors an administration order would be pursued.

It is possible that the thinking behind this is that only a large company could finance the cost of a full time administrator to run the affairs of the company.

In contrast a CVA does not necessarily require the supervisor of the CVA to be full-time in the business. It would be much more likely that the role of such a supervisor would be to monitor the company to ensure that the requirements set out in the proposal are actually achieved.

2. A small company could, however apply for an Administration order instead of a new type CVA with a moratorium - why would that be required?