Fixed Charge Receivership

Appointing a Fixed Charge Receiver (FCR) is a remedy of a secured creditor not an insolvency procedure.

A Fixed Charge Receiver (FCR) may be appointed over specific assets by secured creditors with a fixed charge. This is a relatively cost-effective way of securing recovery in certain distressed situations and the ability of a lender to separate the fixed assets from any floating charge elements of the security is often a crucial aspect of the Appointment.

Unlike other insolvency procedures, the purpose of the FCR is to secure the best possible return for the lender, rather than creditors as a whole.

The FCR will consider an appropriate strategy, including the status and occupancy of the property as well as any issues that may be detrimental to its value and that could be overcome. There is also a duty to safeguard and manage the property and the FCR will insure against the usual risks and be accountable for receipts and outgoings.

Assets subject to a Fixed Charge Receivership can often be problematic and it is important to appoint someone who is suitably experienced and who will take responsibility for resolving difficult issues whilst realising the maximum potential value of the secured asset.