Notice: Statement of Insolvency Practice (SIP) 3.1

Individual Voluntary Arrangements in England, Wales and Northern Ireland.

This file may not be suitable for users of assistive technology.

This file may not be suitable for users of assistive technology.

The Joint Insolvency Committee (JIC), through a working group, has undertaken a review of SIP 3.1 and is consulting on proposed changes to the SIP. The working group comprised insolvency professionals, regulators and other stakeholders including HMRC and the Insolvency Service involved in the Individual Voluntary Arrangement (IVA) process

The Insolvency Service is the secretariat for the JIC and is publishing this consultation on the JIC’s behalf. This is part of arrangements which reflect the Government’s 2023 proposal for the Secretary of State to be given the overall responsibility for setting ethical and technical standards for the insolvency profession, subject to legislation.

The JIC remains responsible for maintaining Statements of Insolvency Practice and for considering consultation responses.

The IVA market continues to evolve; since the last update to SIP 3.1. in 2023 the FCA has implemented its ban on referral fees to debt packagers. This has led to the emergence of new routes through which IVA providers, particularly those in the volume sector, obtain work. As a result, customers may experience a complex referral journey that lacks transparency before entering an IVA.

The revised SIP therefore strengthens and expands the requirements for due diligence of referrers. It requires insolvency practitioners to identify and understand the entire referral journey and to ensure that debtors are aware of the roles and responsibilities of everyone involved in the IVA process. This would be from the initial point of contact and advice through to the implementation of the arrangement, including who each party works for.