In fact, the PVA process is practically identical to that of a CVA with the obvious differentials surrounding partnerships rather than companies. Partnership members would be responsible for drafting the PVA proposal which in a Company Voluntary Arrangement (CVA) would be drafted by directors of the company.
It is imperative that a Partnership Voluntary Arrangement is only agreed upon if the partnership itself is a viable business – or where the partnership has a number of valuable and disposable assets that could be realised to raise capital in the short-term and provide a boost to cash flow.
For partnership members in this position – struggling under the weight of debts or diminishing cash flow – contact Begbies Traynor and our specialist partnership insolvency team can advise you on the right steps to take. If you’re owed money by a business partnership, a PVA is another way of accessing the money that’s owed to you. In a PVA, a proposal will be made to you that enables the partnership to continue trading so that it can repay you from its current assets and future profits.
Unlike an Individual Voluntary Agreement (IVA), a PVA does not provide the partnership with protection if you are absolutely determined to pursue your claims against them in the period before the creditors meeting that must be called under the PVA.
If you choose to formally enforce your claims against the business – and if the partners have personal assets and liabilities – they may have to enter into IVAs, which will run concurrently with the PVA.