The Bankruptcy and Diligence (Scotland) Act 2024

The Bankruptcy and Diligence (Scotland) Act 2024 (Commencement No.1, Transitional and Saving Provisions) Regulations 2024 were passed by Parliament and came into force on 20 January 2025.

These Regulations bring into force sections 6, 8, 9 10, 13, 17, 19 and 20 of the Bankruptcy and Diligence (Scotland) Act 2024 subject to transitional and saving provisions. They primarily make modifications to the Bankruptcy (Scotland) Act 2016 (“the 2016 Act”) and the law of diligence by:

• amending sections 22 and 98 of the 2016 Act to correct cross-reference errors
• amending sections 69 and 134 of the 2016 Act to provide that specified parties can appeal to the sheriff within 14 days of the Accountant in Bankruptcy (AiB) issuing a decision following an appeal to AiB on a determination issued by commissioners fixing the amount of outlays and remuneration payable to the trustee or their representatives.  Where AiB has issued a decision before 20 January 2025, that decision may be appealed to the sheriff up to 14 days after 20 January 2025, instead of within 14 days after that decision
• creating a requirement, where a trust deed is granted by a debtor on or after 20 January 2025, for a trustee to provide the debtor with a copy of a trust deed information document in addition to the Debt Advice and Information Package (DAIP). It also requires the trustee to give the debtor adequate time to consider the information given to them and whether a trust deed is the appropriate solution to address their debts. It does not apply where the trust deed has been granted before 20 January 2025
• modifying sections 76 and 77 of the 2016 Act to reinstate the position that no commissioners may be elected in sequestration cases when AiB is the trustee and where a commissioner already holds office, that commissioner would cease to hold office if AiB becomes the trustee
• requiring that a creditor, where they are applying to the court for a warrant for diligence on the dependence under section 15D(1) of the Debtors (Scotland) Act 1987, must provide the debtor with a DAIP. If this has not been provided the court cannot grant the warrant. This does not apply where the application was made before 20 January 2025
• making it competent for a sheriff officer to execute money attachment on any day or at any time when premises are open for the purposes of trade or business without the requirement to obtain prior approval from the court where it is outside the hours of 8am and 8pm
• allowing arrestment to found jurisdiction of a ship to take place on a Sunday

More information on these provisions is included in the Policy Note.

The Bankruptcy and Diligence (Scotland) Act 2024 (Commencement No.2, Transitional and Saving Provisions) Regulations 2025 were laid in Parliament on 3 April 2025.

These Regulations will bring into force sections 4, 5, 11 and 12 of the Bankruptcy and Diligence (Scotland) Act 2024 (“the 2024 Act”), subject to transitional and savings provisions, on the 25 June 2025.

They primarily make modifications to the Bankruptcy (Scotland) Act 2016 (“the 2016 Act”)  by:

• making minor amendments to clarify the process for applying for recall of sequestration. These will only apply where an application for recall has not been made before 25 June 2025
• where a debtor is seeking a recall of sequestration, it will not be a condition for recall for interest to be paid on their debts if the whole of those debts are paid in full within 6 months of the award of sequestration. For existing cases interest accrued on the debt between the date of sequestration and the date of payment of the debt is not payable if payment of the debt is made in full within 6 months after 25 June 2025
• allowing a trustee in sequestration to resign if the debtor cannot be traced and clarifies that the trustee is entitled to take outlays and remuneration from the ingathered estate up to the date of their resignation
• introducing a new process for a trustee to resign from office, when a debtor has failed to cooperate, by applying for the Accountant in Bankruptcy to take over as trustee

The Regulations make provision for the commencement of section 12 of the 2024 Act on 17 April 2025 but only for the limited purpose of enabling Scottish Ministers to make Regulations under inserted section 147A(3), (5)(a) and (6)(b) of the 2016 Act.

More information on these provisions is included in the Policy Note.

To support the commencement and implementation of the policies underpinning sections 4 and 12 of the 2024 Act, consequential amendments are required to further parts of secondary legislation. 

These amendments will be brought forward in a further set of Regulations called The Bankruptcy and Diligence (Scotland) Act 2024 (Consequential Amendments and Forms) Regulations 2025 which, if passed by Parliament, will come into force on 25 June 2025.