What are provisional liquidators, when are they appointed, and why?


Published by a ÀÏ˾»úÎçÒ¹¸£Àû Restructuring & Insolvency expert
Practice notes

What are provisional liquidators, when are they appointed, and why?


Published by a ÀÏ˾»úÎçÒ¹¸£Àû Restructuring & Insolvency expert

Practice notes
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What is a provisional liquidator?

A provisional liquidator is, in effect, an interim liquidator, where a licensed insolvency practitioner (IP) or the official receiver (OR) is appointed under section 135 of the Insolvency Act 1986 (IA 1986) as provisional liquidator of a company before either the company is wound up by the court, or the winding-up petition has been heard or dealt with. The process and effects are considered in further detail below.

IA 1986, s 135 is supplemented by the Insolvency (England and Wales) Rules 2016 (IR 2016), SI 2016/1024, rr 7.33–7.39.

For further reading on applying to appoint a provisional liquidator, the hearing, order, costs and security and termination, see Practice Note: The appointment of a provisional liquidator.

Why are provisional liquidators appointed?

The main reason a provisional liquidator is appointed is because urgent steps are required to take control of the company and secure its assets. Absent this interim measure, loss to the company's creditors will probably occur. Therefore, the appointment of a provisional liquidator is required

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Key definition:
Provisional liquidator definition
What does Provisional liquidator mean?

A court appointment, often of the official receiver, made at any time after the presentation of a winding up petition usually to protect the company's assets, preserve the company's books and records or to protect the public pending the making of a winding up order.

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