FCA Wins Appeal Over Action on Carillion Collapse

 

In The Financial Conduct Authority v Carillion Plc, the High Court ruled that The Financial Conduct Authority (FCA) does not need the permission of the insolvency court to take regulatory action against a company in liquidation.

In August 2020, the FCA was contemplating issuing statutory notices against Carillion and some of its directors in respect of alleged market abuse and breaches of the Listing Rules pursuant to ss.91 and/or 123 of FSMA. In September 2020, the FCA issued a Warning Notice and published a brief statement about that Warning Notice which summarised the action that the FCA proposed to take against Carillion and others.

The Insolvency and Companies Court ruled that such an action constituted an ‘action of proceeding’ and therefore required permission of the insolvency court under s.130(2) of the Insolvency act 1986 before the regulator was able to proceed.

However, the FCA appealed the courts decision arguing that this was the first time anyone had suggested that permission was required’.

In the appeal, The High Court ruled that the FCA’s enforcement did not amount to this and therefore is not subject to the statutory stay.


This article is intended for information purposes only and provides a general overview of the relevant legal topic. It does not constitute legal advice and should not be relied upon as such. While we strive for accuracy, the law is subject to change, and we cannot guarantee that the information is current or applicable to specific circumstances. Costigan King accepts no liability for any reliance placed on this material. For further details concerning the subject of the article or for specific advice, please contact a member of our team.


 
 

Arianne King

Corporate Specialist

Julian Critchlow

Corporate Speciliast


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