Rescue, Rehabilitation and Insolvency (Corporate and Personal) Act 2026 · As enacted · Part XIII
386. Order of priority where fl oating charge receiver appointed
Official English translation. Where it differs from the Sinhala or Tamil text, the Act itself says which text prevails.
Official translationFrom Department of Government Printing, unchanged
This section applies to a receiver who was appointed by virtue of a floating charge.
In this section, “applicable floating charge” means the charge by virtue of which the receiver was appointed.
Subject to sections 234 and 331 and to the rights of the persons referred to in subsection (4), a receiver to whom this section applies shall apply the proceeds of realisation of the property in receivership in or towards satisfaction of the debt, determined as at the relevant date, secured by the applicable floating charge.
The following persons shall be entitled to distributions of the proceeds of realisation of the property in receivership in priority to the grantee of the applicable floating charge, and in the order of priority in which they are listed –
first, if the company is in liquidation, the liquidator, for any costs reasonably incurred by the liquidator in preserving and realising the property in receivership;
second, the receiver, for the costs, charges and expenses properly incurred by and the remuneration of the receiver under this Act;
third, the grantee of any fixed security over any part of the property that ranks prior to the applicable floating charge, for any debt owing to that grantee, determined as at the relevant date;
fourth, the persons having preferential claims, in or towards satisfaction of their claims,
Rescue, Rehabilitation and Insolvency determined as at the relevant date, set out in paragraphs 1, 2 and 8 of the Fourth Schedule, to the extent and in the order of priority specified in that Schedule, except such costs, charges and expenses as are referred to in paragraphs (a) and (b) of this subsection; and
fifth, the grantee of any floating charge over any part of the property that ranks prior to the applicable floating charge, for any debt owing to that grantee, determined as at the relevant date;
and
sixth, the grantee of any fixed security over any part of the property that ranks prior to the applicable floating charge but below the floating charge referred to in paragraph (e) of subsection (2) of section 431 of the Companies Act, for any debt owing to that grantee, determined as at the relevant date.
After the debt secured by the applicable floating charge has been satisfied in full, any further distribution of the proceeds of realisation of the property in receivership shall be made to the company or, if the company is in liquidation, to the liquidator.
Part XIV