Bankruptcy and Foreign issues
This fact sheet tells you when you can go bankrupt in England or Wales if you live abroad. Bankruptcy is an official order that ends your liability for most debts after a certain period of time, usually one year. If you are struggling to pay your debts, bankruptcy can help you to make a fresh start. However, bankruptcy is a serious option and it is important that you understand what bankruptcy means before choosing to apply.
Use this fact sheet to:
- check if you may be able to go bankrupt in England or Wales when you live abroad.
- understand what is likely to happen after you go bankrupt.
- understand the effect that a bankruptcy order in England or Wales may have on you abroad; and
- see if your creditors may still be able to act against you abroad after you have gone bankrupt in England or Wales.
Bankruptcy in England and Wales – for people living abroad
If you live in another member state of the European Union (EU) (apart from Denmark), you can only go bankrupt in England or Wales if you can show that your centre of main interests is in England or Wales and has been for the last six months. There is no definition of centre of main interests. However, the adjudicator and the court will usually consider it to be the country where you mainly live or currently earn your living. Your centre of main interests is in the country people would expect to find you and where you earn and spend money. If your centre of main interests is in another EU member state (except Denmark), you cannot go bankrupt in England or Wales.
If you live in Denmark, Scotland, Northern Ireland, Gibraltar or outside of the European Union, you can only make yourself bankrupt in England or Wales if you have lived or carried on a business in England or Wales at any time in the three years before you apply for bankruptcy.
A bankruptcy order in England and Wales will not be automatically recognised outside of the European Union and creditors may still act against you in the country you are living in (including Denmark). For more information, see the later sections Moving abroad after bankruptcy, Assets abroad and Foreign creditors.
The application
You must apply online at www.gov.uk. Your application will be sent to an adjudicator at the Insolvency Service. They will check that you cannot pay your debts as they fall due and that England or Wales is the correct place for you to go bankrupt. This means that if you do not meet the criteria described in the previous section Bankruptcy in England or Wales if you live abroad, your application will be refused. You do not have to go to a court hearing. The adjudicator will make their decision within a maximum of 28 days of receiving your application.
If the adjudicator refuses to make a bankruptcy order, they will send you a notice to tell you this. This is called a ‘notice of refusal’. This notice must tell you why the adjudicator did not make you bankrupt. You can ask the adjudicator to review their decision, but you must do this within 14 days of the notice of refusal being delivered. When the adjudicator reviews their decision, you cannot provide them with any new information. You must give reasons for asking the adjudicator to review their decision, but they can only consider the information you provided with your original application. If the adjudicator still does not make you bankrupt, they must send you a notice to confirm this.
After bankruptcy
After a bankruptcy order has been made, you will need to provide the official receiver with further information. The official receiver handles the administration of your bankruptcy. You may be asked to complete further forms or provide certain documents. The official receiver may ask you to attend their office for an interview. In some situations, they may be happy to interview you over the phone.
Unfortunately, these documents cannot be completed before a bankruptcy order is made, and you cannot pre-book an appointment for the interview. However, if you explain your circumstances to the official receiver, for example that you are only in the country for a limited period, they may try to arrange an appointment for you as soon as possible. Alternatively, they may agree that the interview can take place over the phone. You must provide any information that the official receiver asks you for. If you cannot do so, think carefully about whether bankruptcy is the right option for you.
Your trustee in bankruptcy will take control of your assets and contact your creditors. The trustee will either be the official receiver or a separate insolvency practitioner.
Next Steps
If you want to find out anything further about this topic then please feel free to call on 0330 236 9930, 0330 236 9938 or 07961 116321. All conversations will be in strict confidence. You can also email vee@navigatebr.com
This article is for information and interest only. It is not a substitute for full professional advice, which will take in to account the specific and individual circumstances. Navigate Business Recovery Limited cannot accept any responsibility for any loss arising as a result of any person or organisation acting or refraining from acting on any information.
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