The Scottish Government

PHASE 1: SCOPING STUDY
ACT 1985 (AS AMENDED)
UNDER THE BANKRUPTCY (SCOTLAND)
BUSINESS-RELATED BANKRUPTCIES

Lambda Research and Consultancy Ltd.

Scottish Executive
Central Research Unit 2002

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CONTENTS

SUMMARY
1 INTRODUCTION
2 APPROACH
3 BANKRUPTCY
4 PRACTICE ISSUES IDENTIFIED
5 ISSUES FOR A MAIN STUDY
6 CONCLUSIONS AND
RECOMMENDATIONS
1 INTRODUCTION
1.1 BACKGROUND
1.2 REQUIREMENTS
1.3 APPROACH
2 BANKRUPTCY AND SEQUESTRATION
2.1 INTRODUCTION
2.2 THE OBJECTIVES OF SEQUESTRATION
2.3 THE PROCESS OF SEQUESTRATION
2.4 PATHWAYS TO SEQUESTRATION
2.5 AN ALTERNATIVE TO SEQUESTRATION -
PROTECTED TRUST DEEDS
2.6 THE DEBTOR'S EXPERIENCE OF SEQUESTRATION
2.7 CONCERNS ABOUT TRUSTEES
2.8 THE EFFECTIVENESS OF SEQUESTRATION
2.9 POTENTIAL FOR RESCUING BUSINESSES IN DIFFICULTY
2.10 THE IMPACT OF BANKRUPTCY LAW ON ENTERPRISE
3 KEY ISSUES IN THE STUDY OF BUSINESS-RELATED
BANKRUPTCY
3.1 INTRODUCTION
3.2 DISTINGUISHING BETWEEN BUSINESS-RELATED
AND CONSUMER BANKRUPTCY
3.3 ASSESSING DEBTOR RESPONSIBILITY FOR
BANKRUPTCY
3.4 OUTCOME OF BANKRUPTCY FOR THE BUSINESS
3.5 RELATIVE EFFECTIVENESS OF SEQUESTRATION
4 MAIN STUDY - OBJECTIVES
4.1 INTRODUCTION
4.2 ADDRESSING THE OBJECTIVES
4.3 INFORMATION TO BE GATHERED
5 MAIN STUDY - METHODOLOGIES
5.1 INTRODUCTION
5.2 LITERATURE REVIEW
5.3 STATISTICAL DATA COLLECTION
5.4 QUESTIONNAIRE SURVEYS
5.5 INTERVIEW SURVEYS
5.6 CASE STUDIES
5.7 REVIEW OF SOURCES OF ADVICE AND SUPPORT
5.8 ACTION RESEARCH
6 MAIN STUDY - FEASIBILITY
6.1 INTRODUCTION
6.2 COLLECTION OF RETROSPECTIVE DATA
6.3 COLLECTION OF CURRENT DATA
6.4 QUESTIONNAIRE SURVEYS
6.5 CASE STUDIES
6.6 ACTION RESEARCH
7 RECOMMENDATIONS FOR AMAIN STUDY
7.1 INTRODUCTION
7.2 OPTIONS
7.3 RECOMMENDATIONS
ANNEX A - GLOSSARY OF TERMS
ANNEX B - INTERVIEWS UNDERTAKEN IN THE
SCOPING STUDY
ANNEX C - INSOLVENCY/BANKRUPTCY LITERATURE
REFERENCES

Tables, Charts and Figures
Table 1. Summary of approaches to defining
business-related bankruptcy
Table 2. Contribution of different methodologies
towards required information
Table 3. Summary of feasibility issues
Table 4. Approaches to defining business-related
bankruptcy
Table 5. Contribution of different methodologies
towards required information
Table 6. Summary of feasibility issues
Chart 1 - Debtor & creditor petitions for sequestration
and protected trust deeds
Figure 1 -The continuum of bankruptcies