If I live abroad and my debts are in the UK can I enter into an IVA?
The short answer to this question is ‘YES, but…!’ The scope of the question is too broad to address fully in a short article.
Let’s limit the scope to the following criteria:
- All debts are to creditors in the UK.
- The debtor lives in a country of the European Union other than the UK.
- The debtor is insolvent.
- An IVA in the UK is limited to England, Wales and Northern Ireland. For Scotland the broadly equivalent insolvency solution is a Trust Deed.
European regulations permit the insolvency legislation of one member of the state to apply in another subject to certain provisos. The result is that a debtor who now lives in another member state may be able to put forward an IVA if the UK is considered their “centre of main interests”.
A serving member of the Armed Forces for example who is serving abroad and who may be stationed abroad for long periods may enter into an IVA in the UK. The same may apply to anybody who is for example working in a Member State but whose assets are located in the UK. Similarly, anybody who works in the merchant navy may enter into an IVA, even though they may be abroad for much of their working lives, provided their “centre of main interests” is in the UK.
Obviously there are many different scenarios which may impact on the debtor’s capacity to comply with the terms of an IVA. These could include assets held or acquired abroad or debts incurred abroad during or prior to the term of the proposed IVA. Nevertheless, creditors will approve such an IVA provided they are satisfied with the debtor’s capacity to comply with the terms.