The Companies (Rescue Process for Small and Micro Companies) Act 2021 (the “Act”) has been
commenced (7 December 2021) by the Minister of State for Trade Promotion, Digital and Company
The Act provides for the Small Company Administrative Process (SCARP), which is modelled off the
existing framework for examinership, and facilitates the rescue and restructuring of small or micro companies, who must satisfy two of the following three criteria: (1) turnover of less than
€12,000,000, (2) less than 50 employees and (3) balance sheet must not exceed €6 million.
In announcing the commencement of the Act, the Minister of State noted that the Act seeks to
mirror key elements of examinership in an administrative context thereby reducing Court oversight resulting in efficiencies and lower comparable costs. SCARP has limited Court involvement (in comparison to the traditional examinership process in the High Court), and the rescue plan is formulated by a company appointed Process Advisor.
Another benefit of SCARP is that directors and shareholders now have more control in deciding
whether to seek the assistance of a Process Advisor to restructure their companies’ financial
commitments, while availing of protection from their creditors.
In order to avail of the rescue process a company must also be fundamentally viable and capable of trading its way out of its current difficulties. Assessing the viability of the company is the first determination the Process Adviser is required to make following his/her initial appointment by the Directors of the company.
For more information, please contact us at email@example.com, or your usual contact at Vincent & Beatty LLP.