Company Voluntary Arrangements (CVAs) - Law - CVA with a moratorium

Schedule A1 - Insolvency Act 1986 - Paragraph 11 - CVA - Requirement to Notify of the end of the moratorium period


A "moratorium" is a period of time during which creditors cannot take any enforcement action against a Company that has proposed what is known as a Section 1A  Company Voluntary Arrangement (CVA).  The moratorium begins when the appropriate papers are filed in court and ends at the date of the CVA creditors meeting, or possibly earlier. Upon the ending of the moratium the insolvency practitioner acting as the Nominee to the CVA must notify the court, the registrar of companies and the creditors in accord with the provisions of Paragraph 11 of Schedule A1 to the Insolvency Act 1986.


The actual wording of Paragraph 11 of Schedule A1 to the Insolvency Act 1986 is reproduced below in bold.


The Insolvency Act 1986 - Schedule A1 - Paragraph 11 - Notification of end of moratorium


(1) When a moratorium comes to an end, the nominee shall, in accordance with the rules—

(a) advertise that fact forthwith, and

(b) notify the court, the registrar of companies, the company and any creditor of the company of whose claim he is aware of that fact.

(2) If the nominee without reasonable excuse fails to comply with sub-paragraph (1)(a) or (b), he is liable to a fine.




The requirements laid down by Paragraph 11 of Schedule A1 to The Insolvency Act 1986 ensures that,


- The company record at Companies House records all details regarding the Company Voluntary Arrangement (CVA) to include the date on which the moratorium ends.

- The company file at the Court is brought to a conclusion by he notification to the Court of the end of the freeze period.

- The company creditors are notified of the fact that the freezing effect of the moratorium is at an end.