June 4, 2019 7:15 am Written by

UK Insolvency Laws: Post Brexit

I should preface this with the statement, if we do leave the EU.

There seems to be so much speculation as to if there can ever be an agreement with the UK leaving the EU, and sorting out all the details. Much is up in the air. There is even the very real possibility of elections and referendums as the PM has stated she will step down soon. Then we have a new political party, the Brexit Party, tossing its rhetoric about.

Throw in the fact that EU nationals living and working in the UK now have to apply to get EU settlement status here in the UK, even if they have lived here most of their lives, and it all gets confusing.

Want to be confused even more….when initially rolled out the EU Settlement Scheme had a fee attached to it of £65 per application for those age 18 and older, and a fee of £32.50 for those age 16 and under. And yes, all children are required to have settlement status as well.

Then the government scrapped the fees, giving refunds to those who already paid the fees.

Confused yet?

So one question on some people’s minds is how Brexit may affect our insolvency laws here in the UK???

The fact is if this has been addressed by the government, I think we have seen or heard very little about it. The fact it the changes may be minimal and only to affect debts outside the UK.

To speculate and look at this question in a Mr. Spock logical manner, it is best to begin with how our insolvency laws operate now, and in particular, how our insolvency laws relate to and affect debts outside of the UK.

Just leaving the EU should not affect how a UK citizen, or someone residing in the UK and meets the residency requirements, makes use of the insolvency laws, or will it?

More speculation.

Currently How UK Insolvency Laws Interact and Relate to Debts Outside the UK

Currently if you are eligible to go bankrupt in the UK, you can include any debts you may have from anywhere in the world, the EU, America, UAE, anywhere.

You can even go bankrupt in the UK, from outside the UK, again if you meet the requirements.

So you can move out of the UK, live in another country, return to the UK, and include those debts in a UK bankruptcy, however, remember for now the UK and EU have open agreements, and certain collection practices and policies in lace to allow the collection of EU or UK debts in our respective countries.

These agreements do not extent to other countries such as the US, UAE, Canada, etc.

If you go bankrupt in the UK and include debts from the EU, UAE or any country, the protection afforded you by your UK bankruptcy only protects you in the UK, and for now the EU.

So if you owe money in the UAE and include it in a UK bankruptcy, the UAE banks cannot force you to pay in the UK and for now the EU. This does not limit their authorities in their own country, and possibly others.

But you are protected here in the UK, and for now the EU.

For now.

Once the Brexit is final, while you may be able to include EU debts in a UK bankruptcy, your bankruptcy protection may only be in the UK, and not the EU as it is currently in both.


Unless something is written into the agreement to leave the EU, and the EU agrees to it, any debts in the EU would be treated just as a debt in the USA, UAE, Australia, or any other country outside the UK.

The UK and EU are no longer one under the agreements, once we fully exit, that changes.

Or will it???

So far no releases from the Government’s Insolvency Service as to how the Brexit may affect things, from an insolvency and bankruptcy standpoint.

However, there have been a consensus among some that the regulation changes regarding deal or no deal, will force some changes.

And I am only discussing personal bankruptcies here, for businesses and companies that operate in both the UK and EU, there can be larger and more complicated issues.

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