U.K. social housing securitizations have, up to now, enjoyed exemption from administration risk - where a third party suspends control of a company if its solvency become questionable. Because the social housing deals were believed to be exempt from administration risk, several of these transactions have been outstanding for a number of years. However, recent court cases tried under the new European Union insolvency legislation may threaten their special status.
Up until now, housing associations fell under the status of Industrial and Provident societies, which are not exposed, to administration. Recent U.K. high court cases have highlighted that under the new EU regulation, administration proceedings can now extend to unregistered companies.