Small Companies Administrative Rescue Process (SCARP) is a formal Insolvency process designed to help small and micro businesses who want to continue trading during times of financial difficulty.
SCARP is a streamlined insolvency process introduced in Ireland by the Companies Act 2021. It helps viable small and micro companies restructure their debts and avoid liquidation.
SCARP offers a valuable option for companies in Ireland to manage financial distress while maintaining operations and protecting jobs.
The process begins with an initial consultation where the insolvency practitioner assesses the company’s financial situation.
If the company is eligible, the insolvency practitioner is formally appointed as the Process Advisor. They will file necessary documentation and discuss the SCARP process and plan with directors, then file resolution with the court.
The Process Advisor conducts a thorough financial assessment, which includes detailed analysis of company assets, liabilities, income, expenses and identify key financial areas where cost savings can be made.
The rescue plan and proposal is prepared and sent to creditors for review. Creditors meetings take place and negotiation happens in the hope of gaining creditor approval.
For the rescue plan to be implemented, it must be approved by the creditors. This involves facilitating a formal vote among creditors to approve the plan before day 49. At least 60% of creditors (in value, by majority number) must vote in favour for the plan to be accepted.
If approved, the Process Advisor oversees the implementation of the rescue plan, including managing payments, monitoring the company's financial performance and providing support and guidance.
There is a 21 day cooling off period where creditors can file an objection to the rescue plan. If there are no objections, the plan becomes legally binding. If there are objections, it will be reviewed by the court for review.
Throughout the implementation phase, the Process Advisor provides ongoing support to the company.
On successful completion of the rescue plan, the company exits the SCARP process. This involves preparing a final report and officially notifying all authorities and creditors that SCARP has been completed.
SCARP stands for Small Companies Administrative Rescue Process. It is a dedicated rescue process designed for small and micro companies facing financial difficulties. The process aims to help these companies restructure their debts and continue trading.
To be eligible for SCARP, a company must:
The SCARP process involves the appointment of a Process Advisor who works with the company’s directors to develop a rescue plan. This plan is then presented to the creditors for approval. If approved, the company can restructure its debts and continue trading.
The SCARP process is designed to be swift, typically taking around 70 days from start to finish, depending on the complexity of the case and the cooperation of all parties involved.
McCambridge Duffy, as experienced Insolvency Practitioners, will act as the Process Advisor, guiding you through each step of the SCARP process. We will work closely with you to develop a viable rescue plan and liaise with your creditors to seek their approval.
If you believe SCARP might be a solution for your company, contact us for a free consultation. Our team will assess your situation and advise you on the best course of action.
By working with McCambridge-Duffy, you are ensuring your business receives practical and efficient solutions to their financial challenges. Our expertise in SCARP not only helps businesses avoid liquidation but also sets them on a path to recovery. You will appreciate taking an early, proactive approach in guiding the business towards a brighter financial future rather than allowing your business to face liquidation down the line.
If your company or your client may need a CVL, our experienced team is here to help. Contact us for a confidential consultation.
Empower your business with the tools it needs to overcome financial difficulties. Contact McCambridge-Duffy today and help your business unlock the potential for a stable and prosperous future.
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