The Act Part 2 – Sequestration and Trust Deeds Section 9 – certificate for sequestration
48.Section 9 amends the 1985 Act by introducing a new route into bankruptcy on the basis of a certificate completed by an authorised person. It also removes the existing route into bankruptcy by debtor application with concurring creditors.
49.Section 9(1)(b) repeals section 5(2A) of the 1985 Act to remove the provision that allows a debtor to apply for an award of sequestration on the basis of creditor concurrence (i.e. that a creditor concurs to a debtor’s application for sequestration). Section 9(1)(a) contains a consequential amendment which removes a cross-reference to the repealed section 5(2A).
50.Section 9(1)(c) amends section 5(2B) of the 1985 Act to provide that a debtor may apply to the Accountant in Bankruptcy for an award of sequestration if they have been granted a certificate for sequestration. There may be a prescribed period for a valid application following the grant of a certificate (see new section 5B(5)(c) of the 1985 Act). The existing section 5(2B) requirements for a debtor application for sequestration, together with other requirements of the 1985 Act, will apply in addition to the requirement for a certificate.
51.The effect of the new certificated route and the repeal of the creditor concurrence route is that, under the amended provisions of the 1985 Act, a debtor will be able to apply for their own bankruptcy if they meet the following conditions—
	they were habitually resident or had an established place of business in Scotland in the 1 year period preceding the date of their application – see section 9(1A) of the 1985 Act,
	they owe debts totalling at least £1,500 – see section 5(2B)(a) of the 1985 Act and the non-commencement of section 25 of the 2007 Act in article 3(1)(a)(iii)(aa) of the Bankruptcy and Diligence etc. (Scotland) Act 2007 (Commencement No. 3, Saving and Transitionals) Order 2008 (S.S.I. 2008/115),
	no award of bankruptcy has been made against them in the previous 5 years – see section 5(2B)(b) of the 1985 Act, and
	either—they are “apparently insolvent” as defined in section 7 of the 1985 Act,they have granted a trust deed which has been rejected as a protected trust deed,they meet the low income low asset conditions in section 5A of the 1985 Act, orthey have a certificate for sequestration issued within the prescribed period, confirming that they are insolvent and completed by an authorised person (this is the new certificated route).
52.Section 9(1)(d) inserts a new subsection (2F) in section 5 of the 1985 Act. This enables Scottish Ministers by secondary legislation to prescribe the maximum period allowed between the date on which an authorised person signs a certificate for sequestration and the date on which an application is made.
53.Section 9(2) inserts a new section 5B into the 1985 Act which introduces a certificate for sequestration (see below).
54.Section 9(3) amends section 12(1)(b) of the 1985 Act to remove the reference to section 5(2A) which is repealed by section 9(1)(b) of this Act.