Insolvency Practitioner Authorisation Criteria
[Approved by Council 27 September 2018 and effective from 15 October 2018]
An applicant for an Insolvency Practitioner Authorisation is required to show that he/she:
- is fit and proper to act as an insolvency practitioner (IP);
- meets acceptable requirements as to qualifications and practical training and experience;
- has in place security or caution for the proper performance of their functions; and
- has undertaken relevant continuing professional education.
Qualifications should be evidenced by letters or similar documentation issued by the Joint Insolvency Examination Board (JIEB) or as provided by The European Communities (Recognition of Professional Qualifications) Regulations 2007 (EC Qualification Regulations).
Practical training and experience should be certified by one or more insolvency practitioners.
Security or caution should be evidenced by lodging the original of the general penalty (enabling) bond with the IPA and submitting monthly cover schedules (bordereaux) to the IPA.
Capability to carry out unsupervised the functions and duties of an IP should be confirmed by an insolvency practitioner.
Records of continuing professional education should be kept and available for production.
Fit and Proper: The Regulation and Conduct Committee will take account of the matters set out at Appendix I [see below]; and it may
- require such further information and explanations from the applicant and from (each of) the certifying and confirming insolvency practitioner(s); and
- make such further and other enquiries of third parties
as it considers appropriate as to the applicant’s fitness and probity to be an IP authorised by the IPA.
Qualifications: An applicant for authorisation is required to have passed the Joint Insolvency Examination (JIE) set by the JIEB; or in the case of an eligible applicant from another member state of the European Economic Area, that he/she complies with the requirements of the EC Qualifications Regulations.
If the applicant passed the JIE more than ten years before his/her application, he/she may be required to re-sit it unless he/she can show that in the intervening period he/she has maintained his/her knowledge and understanding of personal insolvency law, procedures and practice at a level and to the extent required by the JIEB.
Practical Training and Experience: An applicant for an authorisation, whether based on having been previously authorised or on having passed the JIE or having satisfied the EC Qualifications Regulations, is required to show his/her ability to carry out unsupervised the functions and duties of an IP based on having been engaged during the three years immediately before applying in work relating to the administration of estates in respect of which an insolvency practitioner has been appointed involving not less than 600 hours higher experience in insolvency administration . Generally, an applicant will be expected to have been engaged in insolvency administration for not less than 100 hours in each of the three years before applying.
The Regulation and Conduct Committee may at its discretion consider whether and to what extent advisory work experience and/or regulatory work experience [see definitions at IPA Membership Criteria Appendix I] at an equivalent level may be taken into account in its assessment of the adequacy of the applicant’s overall experience; and it may at its discretion accept engagement in insolvency administration of less than 100 hours in any of the three years before applying.
The applicant should set out in his/her application information about the insolvency work which he/she has undertaken in the three years immediately before applying which should be certified by the insolvency practitioner(s) for whom he/she has worked.
The application should be accompanied by confirmation by an insolvency practitioner (who may be the same as the certifying insolvency practitioner) that the applicant is capable of carrying out unsupervised the functions and duties of an IP.
The Regulation and Conduct Committee may require such further information and explanations from the applicant, from (each of) the certifying and confirming insolvency practitioner(s) as it considers appropriate as to the applicant’s ability to undertake unsupervised the functions and duties of an IP.
An applicant must have a good command of the English language, both spoken and written; and the Regulation and Committee may ask to be satisfied as to his/her proficiency in English.
Security or Caution (Insurance and Bonding): An appointment taker IP is required by the IPA Professional Indemnity Insurance (PII) Regulations to have PII cover; and by the statutory Insolvency Practitioners Regulations to have a general penalty bond for £250,000, together with specific penalty bonds in relation to individual insolvencies to which he/she is appointed.
The original of the general penalty bond is required to be submitted to, and is retained by, the IPA.
Copies of monthly cover schedules submitted to the IP’s insurers are required to be sent to the IPA.
Continuing Professional Education (CPE): The IPA requirement in relation to CPE is set out in its CPE Guidance: essentially, it requires a minimum 25 hours relevant structured CPE during each year which may include attending or speaking at courses, conferences, seminars and lectures organised by R3, other commercial course and conference providers, in-house or by other professionals and their firms. Relevant in this context means that for example an IP who acts or intends to act in relation to individual voluntary arrangements would be expected to have undertaken an appropriate proportion of CPE covering personal insolvency including advice on alternative non-statutory solutions.
An applicant for authorisation and an authorisation holder should have available to produce to the IPA details and evidence of courses and conferences attended and of other CPE undertaken in relation to the three years prior to applying for or renewing his/her authorisation.
Administration of and Records of Cases: An applicant for an authorisation is required to provide details of the address(es) where the cases to which he/she is or will be appointed are or will be administered and where the records required by the legislation are or will be maintained.
An authorisation holder is required to immediately notify the IPA of any change(s) in the address(es) where the cases to which he/she has been appointed are administered or where the records required by the legislation are maintained
Continuity of Practice: An authorisation holder in sole practice is required to provide details of an appointment taker IP who has agreed to provide continuity in relation to the administration of his/her cases in the event of his/her incapacity or death.
An authorisation holder in a partnership or company where there is more than one IP should have arrangements for continuity set out in a partnership or company agreement; and is required to provide details of any appointment taker IP nominated to provide continuity in relation to the administration of his/her cases in the event of his/her incapacity or death.
Declaration: An applicant for a new or renewal of authorisation is required to disclose all and every facts and circumstances which are relevant to consideration of his/her application; and to immediately notify the IPA of any material change in the information provided whether it arises before or after the issue of a new or renewed authorisation which may be relevant to consideration of whether he/she continues to be fit and proper to hold an insolvency authorisation.
An applicant for a new or renewal of an authorisation is required to undertake:
- Not to practice as an IP without Professional Indemnity Insurance at an appropriate level
- Not to act as an IP unless there is in force security or caution as required and prescribed by legislation, generally and in relation to every case to which he/she is appointed
- To promptly send to the IPA his/her original general penalty bond and renewal slips evidencing that it remains in force, together with copies of the monthly cover schedules submitted to his/her insurers
Any false, inaccurate or misleading information provided by an applicant for a new or renewal of an authorisation or failure to notify any material change in information provided may lead to a refusal of a new or renewal of an authorisation, or revocation of a granted authorisation, as well as disciplinary action in relation to, and suspension or withdrawal of, his/her membership of the IPA.
Appendix I – Insolvency Practitioner Authorisation Criteria
- Whether the applicant and/or his/her firm/partnership/company has maintained the specified level of professional indemnity insurance
- Whether the applicant has maintained the required levels of general and specific penalty bonds; has deposited the original general penalty bond with the IPA; and has submitted by the specified time monthly cover schedules to his/her insurers and to the IPA
- Whether the applicant has submitted by the specified time reports and returns required by The Insolvency Service, the Accountant in Bankruptcy and the Registrar of Companies
- Whether the applicant has remitted by the specified time sums required to be paid into the Insolvency Services Account (ISA)
- Whether the applicant has paid over promptly unclaimed dividends
- Whether the applicant has been the subject of proceedings brought by The Insolvency Service or the Accountant in Bankruptcy or the Registrar of Companies for failing to submit or delay in submitting reports and returns, paying estate funds into the ISA or paying over unclaimed dividends
- Whether the applicant has applied for an authorisation to act as an IP to another recognised professional body or to the Secretary of State which has been refused
- Whether the applicant has had an authorisation to act as an IP which has been restricted, lapsed or removed
- Whether the applicant has been refused admission to, or been removed from, any professional body or similar association; or any action is pending
- Whether the applicant has been the subject of any adverse findings by the IPA or another professional body or any government, statutory or regulatory authority (including The Insolvency Service) in relation to any matters, whether by way of financial penalty or other disciplinary action (including reprimands, warnings and undertakings and suspension/removal from Official Receiver rotas or lists of interim trustees); or any matters (including complaints) are currently being considered by any of them
- Whether the applicant has been or is the subject of a bankruptcy order, sequestration order, voluntary arrangement, deed, scheme, composition or other form of agreement or debt management plan with his/her creditors; or any proceedings are pending
- Whether the applicant has been or is a director of, or involved in the management of, a company which has gone into liquidation, administration or administrative receivership or entered into a company voluntary arrangement, scheme, composition or other form of agreement with its creditors; or which has been or is the subject of a statutory or regulatory investigation
- Whether the applicant has been the proprietor or partner in any business or been a director of or involved in the management of, any company which ceased trading leaving creditors unpaid
- Whether the applicant has had any judgments entered against him/her; and any are still outstanding
- Whether the applicant has been or is the subject of proceedings alleging negligence, misconduct or other liability in relation to an insolvency or other professional matter; or any proceedings are pending
- Whether the applicant has been convicted of any criminal offence, other than a minor motoring offence not resulting in disqualification; or any proceedings are pending
- Whether the applicant has been or is subject to a disqualification order or undertaking in relation to a company or office or subject to a bankruptcy restriction order or undertaking; or any proceedings are pending
- Whether the applicant has been removed or dismissed from any form of employment or engagement on grounds of misconduct, incompetence or unfitness or from any fiduciary office or position of trust (whether or not remunerated) including as an insolvency office holder; or any action is pending.
- Whether the applicant has been or is a patient within the meaning of the Mental Health Acts
Whether the applicant has committed any breach of any of the IPA Articles, Rules, Regulations or Guidance, including its Guide to Professional Conduct and Ethics and Statements of Insolvency Practice adopted by the IPA, or has been or is engaged in any conduct or practice likely to bring discredit upon him/herself, the IPA and its membership or the insolvency profession; or he/she had or has any relationship or dealings with any individual, firm, partnership or company which has been or is the subject of complaint to or investigation by it (the IPA), another professional body or any government, statutory or regulatory authority (including The Insolvency Service).
 Higher experience in insolvency administration is defined as engagement in work relating to the administration of estates in respect of which an IP has been appointed where the works involves the management and supervision of cases on behalf of the IP or regulatory work at an equivalent level.