The RHA has welcomed today’s announcement by business minister Edward Davey that the law on pre-pack administration is likely to be changed in the next twelve months.
“We are pleased to see that the minister has acknowledged that the current system does not enjoy a sufficient level of confidence and is felt to be subject to abuse”, said RHA chief executive Geoff Dunning.
RHA members have been concerned that some phoenix companies that result from pre-pack administrations are benefitting from the dubious trading practices of its predecessor.
“We welcome changes that will allow creditors to be warned that a pre-pack sale is imminent as this at least means that they will be in a position to either stop the sale, or make an offer for the assets”, Dunning continued. “We have been campaigning for some time as to the unfairness of the existing system and will be studying the proposed changes in detail.”