Administration fees courting controversy

FOR IMMEDIATE RELEASE
(Free-Press-Release.com) February 23, 2012 -- Companies which could have been rescued face the prospect of closure and unnecessary job losses because of a Government refusal to introduce new laws, according to R3, the trade body that represents more than 300 insolvency practitioners in Yorkshire.

R3 says recent court cases have added to the financial burden facing administrators when they are called in to rescue a company, making it less economic in some cases.

In the past, administrators were liable for the trading costs like wages, rent, rates and new supplies that followed their appointment, but new court judgments mean they may also be liable to meet other rent and pensions obligations of the collapsed company.

R3 wants new laws that clearly state what charges administrators are liable to pay.

Yorkshire chairman and Irwin Mitchell partner Andrew Walker said: “These court rulings and the continued uncertainty has had an unhelpful impact on the UK’s rescue culture, with far reaching, adverse consequences for the UK economy.

Article sourced from: http://www.thestar.co.uk/news/business/administration_fees_courting_controversy_1_4176421

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