There is a tension between UK insolvency and pensions laws. Put simply, this is because insolvency laws look to protect all of the company’s creditors, but pension laws seek to protect the interests of the pension creditors alone.
When new offences and criminal sanctions were introduced in 2021 enabling TPR to issue fines of up to £1million – with the potential for those offences to capture insolvency practitioners, lenders, directors and others – this did nothing to enhance the unhappy relationship between restructuring and pensions.
For a reminder of the new offences and the concerns felt by the restructuring market, see our earlier blogs here and here.
Our colleagues in pensions have recently posted a blog reflecting on these new powers and whether and to what extent those have been used – including the new notifiable events regime and what has happened to that. For those in the restructuring market who may come across companies that have a defined benefit pension scheme it’s worth a read – not least because it is a helpful reminder of the powers, but also to give some comfort that to date TPR has not – seemingly – done much with them.