The ASB has welcomed the publication of a report which draws attention to the serious difficulties caused by outmoded legal restrictions on the ability of companies to make distributions, and in particular the rigid link between distributions and statutory accounts which is a feature of UK and European law.

The Report recommends that European and national authorities urgently consider an alternative that would both be easier to comply with and provide superior protection for creditors. This would focus on the need to ensure maintenance of solvency rather than capital.

The Report, which was published in June by the British Institute of International and Comparative Law (BIICL), has been produced by an interdisciplinary group led by Jonathan Rickford, the Director of the BIICL's Company Law Centre. The Group was set up at the joint initiative of the ASB and the Company Law Centre.

Details of the Report may be found at www.biicl.org