Thursday, 21 November 2013

The Background to the Disqualification Undertaking Regime

Disqualification Undertakings came into force on 2 April 2001 as part of the Insolvency Act 2000. 

Prior to this time a person facing disqualification could not be disqualified without there being a formal Court hearing. This was even true where a person was prepared to consent to being disqualified voluntarily. The Company Director Disqualification Act 1986 simply did not cater for any form of voluntary disqualification. 

This made it both expensive and time consuming for people who were prepared to accept a disqualification on a voluntary basis – either because they were unwilling or unable to contest the legal proceedings which they faced. 

In recognition of this problem, a new streamlined method for enabling a person to agree to a voluntary disqualification was introduced in 2001.