The FCA has published consultation guidance for its approach to compromises, which are arrangements that allow a company to settle liabilities with creditors and shareholders, including taking a company to court if the situation requires.

The consultation sets out what is expected of companies seeking to limit their liabilities.

The guidance comes as the regulator has seen an increase in companies developing proposals, such as scheme of arrangements, to deal with significant liabilities to consumers in particular where there has been a rise in redress liabilities which is the main focus of this guidance.