Extending the period of administration – it’s not pushing on an open door!

May 20, 2026

Extending the period of administration – it’s not pushing on an open door!

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By Charles Collar

Read time:  3 minutes

Administration is designed to be a temporary insolvency process, but in practice, many administrations cannot be completed within the standard 12-month period.

Whether administrators are pursuing asset recoveries, resolving litigation, or making distributions to creditors, an extension is often needed to achieve the purpose of the administration.

While extensions were once granted relatively routinely, the courts are now taking a far more rigorous approach, with extension applications now subject to much closer scrutiny. Administrators seeking extra time must be prepared to clearly justify both why the extension is needed and how it will benefit creditors.

Our insolvency experts have summarised the key considerations and recent case law surrounding applications to extend the period of administration.

If the administrator believes further time is needed to carry out and fulfil their duties, they can seek to extend the period of administration by either obtaining creditor consent or a court order.

Creditor consent will usually be the first option most administrators will use, as it does not require a court application. However, the consent route can only be used once and the period of the extension is limited to one year. Consequently, if an administrator requires further time after obtaining creditor consent, they will need to apply for a court order for a further extension of time.

[The court can extend the administration more than once, even if it has already been extended with creditor consent, and can extend the period for more than one year if believes appropriate in the circumstances].

There are two leading authorities which set out the court’s approach when deciding whether to make an order and the issues that are commonly encountered. In Re Nortel Networks UK Ltd and others [2017] EWHC 3299 (Ch) (“Nortel”), it was held the court’s discretion should be exercised in the interest of creditors as a whole and the following circumstances should be taken into account:

• whether the purpose of the administration remains reasonably likely to be achieved;
• whether any prejudice would be caused to creditors by the extension; and
• any views expressed by the creditors.

In Nortel, the court also noted that if the unsecured creditors are to receive a distribution in the administration, and an extension is required in order to allow those distributions to be made, the extension will likely be appropriate. However, creditors should at least be provided with notice of the administrator’s application and given an opportunity to express their views on a further extension, otherwise the court may take the view that the administrator has failed to consider the interests of the Company’s creditors as a whole.

Further guidance was provided in Re TPS Investments (UK) Ltd [2020] BCC 437, where the court identified the following questions which should be addressed in extension applications:

• Why has the administration not yet been completed?
• Whether an alternative insolvency regime is more suitable?
• Is an extension likely to achieve the purpose of administration?
• If an extension is appropriate, how long should it be granted for?

It is also important to ensure that any previous extensions were validly obtained and that there were no procedural defects, for example consent was obtained from each of the Company’s secured creditors. If any defect transpires, a retrospective administration order may also be required in order for a further extension to be granted.

Key takeaway

These cases demonstrate the court’s focus when considering an extension application, and administrators and their lawyers should be prepared to justify both the need and period of the extension sought, with evidence and a realistic plan to achieve their goals. Importantly, applications for an extension to the period of administration should not be simply regarded as rubber-stamping exercise by the court.

If you have any questions or concerns regarding this article, or need any help or advice on an insolvency related matter, please contact one of our insolvency specialists on 02920 829 100 for a free initial chat or via our Contact Us form.