The Chancellor of the High Court has published a new Practice Statement in respect of schemes of arrangement and restructuring plans. It will apply to all applications where the convening hearing is listed for a date on or after 1 January 2026. 

The Chancellor had originally launched a consultation in May of this year seeking views on a revised draft Practice Statement to replace that which had been in place for the previous five years. We commented then on the reasons why an updated Practice Statement was thought to be required and on the main proposed changes which would apply, particularly in relation to restructuring plans (see our article on reforming the procedure for Schemes of Arrangement and Restructuring Plans).

Whilst the new Practice Statement is similar in form to the original draft, the wording has been adjusted in a number of places to reflect responses to the consultation. We can now comment in more detail on a few of the main changes which will apply for future applications in relation to restructuring plans.  

Issuing the claim form

The applicant will now need to issue a claim form before they are able to secure any hearings with the Court. This will end the practice of counsel’s clerks informally reserving convening and sanction hearing dates prior to issue of the claim form. 

As part of the consultation process, various respondents pointed out that if an applicant were able only to reserve hearing dates when they issued their claim form then, in order to be sure of securing dates, this would require them to issue their claim form at an earlier stage than they would otherwise have considered advisable. Their concern was that as soon as the applicant issued their claim form, they would be disclosing their intentions to the whole of the outside world.  

The draft Practice Statement did allow a claimant to apply for an order to restrict access to the Court file but only “if the same is essential for reasons of commercial confidentiality”. This has been amended. The new practice statement now states that, when issuing its claim form:

“In an appropriate case, the applicant may apply for an order restricting access to the Court file under CPR, Part 5 and/or for an order that its identity or (if different) that of the company should not be disclosed under CPR, rule 39.2(4).”

Clearly the final wording is helpful in so far as it does now expressly contemplate that both types of order may be granted in an appropriate case. However, an applicant wishing to obtain such an order cannot simply assume that their application would be adjudged an “appropriate” case. If the applicant fails to obtain an order, they must expect their or the company’s identity (and potentially the fact and basis of their failed application to obtain such an order) to become public.    

The test for an anonymity order under CPR 39.2(4) is one of necessity, not simply desirability. The wording used in the rule in question is: “if, and only if, [the court] considers non-disclosure necessary to secure the proper administration of justice and in order to protect the interests of that person”. Cases where anonymity orders have been granted have generally involved significant privacy concerns requiring an individual’s anonymity. Mere commercial sensitivity on the part of a company would not, without more, be enough.

An application under CPR 5.4C(4) to restrict access to the Court file would also face a high threshold. The key case on restricting access to Court documents is WH Holding Ltd v E20 Stadium LLP [2024] EWHC 817 (Comm) in which the judge made it clear that open justice is the default position and that any departure from the open justice principle will require clear justification and must be kept to a minimum. If anything, the current trend is towards greater transparency. 

We think that an applicant seeking an order for anonymity and/or to restrict access to the Court file would therefore need to produce specific and detailed arguments as to the harm likely to be caused by its application becoming public knowledge, rather than rely upon general assertions as to the need for confidentiality or about potential harm to the company’s business. It may also be prudent for the applicant to seek an order which applies only for a limited period of time, as the Court may be more inclined to grant more focused relief.          

An applicant who was unable to obtain such an order might take some comfort from the fact that, as we discuss further below, they will not need to file their evidence in support of their application more generally at the same time as they file their claim form, because the rule that would otherwise require this (CPR 8.5(1)) is expressly disapplied. There will therefore be little to see on the Court file.

Ultimately, however, we will need to await the outcome of the first applications for such an order before we know how the courts will address the necessary balancing exercise in this context. Even then, the outcome of an application will inevitably turn on the judge’s assessment of the facts of the specific matter.

Finally and separately, the issue of a claim form will almost certainly be an event of default under the company’s finance documents and it may also be a breach of various of the company’s other key contracts. This will not always be a concern. So far as the finance documents are concerned, other events of default may well already have occurred by the time the claim form is issued. So far as leases of premises are concerned, if there are rent arrears an event entitling the landlord to forfeit or to take other action will already have occurred and even if not the issue of the claim form will often not be the step in the restructuring plan process which first gives the landlord the right to forfeit. Nevertheless, in situations where the issue of the claim form is the first event of default or the first breach, the earlier the claim form is issued, the earlier this event of default or other breach will occur.

Listing note

The applicant will also still be required to file a listing note at the same time as it issues its claim form, although the final version of the new Practice Statement now makes it clear (if such clarification was required) that this note is for the benefit of the Court.     

Timetable

The final version of the new Practice Statement is also more specific regarding timings than was the original draft. We think it helpful that it places clear timetabling requirements not only on applicants but also on opponents of plans.        

As already noted above, the applicant’s evidence will not need to be filed at the same time as it files its claim form, but should instead be filed and made available to creditors and/or members as soon as practicable. This should normally be at least 14 days before the date of the convening hearing. 

In turn, any party objecting to the plan whose objection is likely to have an impact on matters to be considered at the convening hearing will now be expected, if practicable, to identify the nature of their objection(s) at least seven days prior to the convening hearing.