The U.K. Pensions Regulator–Will Its Powers Be Limited?

This article originally appeared in Business Restructuring Review, March/April 2011.

Ever since the establishment of the U.K. Pensions Regulator (the "Regulator") by the U.K. Pensions Act 2004 (the "Act"), the Regulator's exercise of its authority has been of major importance to the U.K.'s restructuring and rescue business. The first judicial review of the Regulator's powers, however, hints that some of the procedures it has adopted may be curbed in the future.

THE PENSIONS REGULATOR AND THE RESTRUCTURING ENVIRONMENT

The increasingly large size of pension liabilities has made such liabilities central in any restructuring where there is a defined-benefit pension plan. Such a plan is usually the largest unsecured creditor by far, holding claims that in pure value often dwarf all other liabilities. The Regulator's powers to pierce the corporate veil and extend pension liabilities to group companies and shareholders have increased the importance of