Introduction
Huboo Technologies Limited (now Hub Realisations Limited Company number 09727464) ceased operations during December 2024 before a new entity acquired its assets. The pre-pack administration procedure enabled the business to operate under a different name. The pre-pack administration process appears to function as a loophole which enables failing companies to continue their operations.
How Did Huboo Use a Pre-Pack Administration?
Huboo entered administration on 23 December 2024.
It was immediately sold for just £9 to Brislington Tradeco Limited.
The new company, Huboo Tech Limited, was set up in December 2024.
Why Are Pre-Pack Administrations Controversial?
Unsecured Creditors Are Left With Nothing
Huboo owed money to suppliers, small businesses, and HMRC.
The new company, Huboo Tech Limited, failed to assume responsibility for outstanding debts.
It’s a Legal Way to Wipe Away Debt
Huboo Tech Limited gets a fresh start while creditors suffer.
Meanwhile, businesses owed money have no recourse.
It Creates an Unfair Playing Field
Businesses that handle their finances correctly do not receive the same benefits as other companies.
A failing business should not have the right to begin anew without facing any penalties.
Should Pre-Pack Administrations Be Restricted?
Should stricter regulations prevent businesses from escaping debts this way?
Should customers and suppliers be given advance warning when a company is about to collapse?
Conclusion
The legal loophole enabled Huboo to transform into Huboo Tech Limited immediately after its collapse. A failing business can use this legal loophole to eliminate debts before restarting operations while other companies must bear the consequences.
