After a period of significant inactivity as a result of the various temporary measures introduced during the pandemic, we are now approaching an insolvency cliff edge in the UK. In this video, senior restructuring and insolvency lawyers from TLT’s Scottish, Northern Irish and English offices discuss:
Additional conditions will be imposed on administrators seeking to dispose of a company’s business or assets to a party connected to the insolvent company within 8 weeks of their appointment, for administrations beginning on or after 25 June 2021. Equivalent provisions have been in force in Great Britain since 30 April 2021.
Summary
Affected sales will be subject to either
(1) prior creditor approval or
(2) prior review by an independent evaluator.
What is it and what has changed?
Wrongful trading is a term that has received quite a bit of press over the last few months, mainly through the headlines generated by the UK Government’s unprecedented amendment to the wrongful trading provisions contained within our insolvency legislation.
But what exactly is wrongful trading and what has changed?
This is inevitably a challenging time for many company directors throughout Northern Ireland and beyond. Businesses have been faced with a quite unprecedented set of social and economic circumstances due to the Covid-19 pandemic and now, as lockdown has eased and restrictions begin to be lifted, the focus turns to how those businesses that have been most severely impacted by this crisis will evolve. Directors are no doubt busy strategising how to best ensure their company’s immediate short term stability and in time their longer term growth and prosperity.