Directors of companies have been facing, and continue to face, extremely challenging circumstances due to the financial impact of the coronavirus pandemic. The decisions they have taken through the pandemic to date have been made against a backdrop of unknowns: unknown closure durations, unknown projections and uncertain futures.

Both businesses and individuals have suffered financially throughout 2020 as a consequence of the coronavirus pandemic.

There has been a significant increase in the use of CVAs, in particular in the retail and hospitality sector over the last 12 to 24 months, largely impacting landlord creditors. Consequently, there has been an increase in landlords challenging CVAs.

Landlords (and other creditors) may apply to court to challenge a CVA on the grounds of material irregularity or unfair prejudice.

On 15th September 2020, the Companies Act (Suspension of Filing for Dissolution and Winding Up) Regulations (the ‘Regulations’) were introduced as part of several other measures intended to protect local businesses from the adverse economic impact brought about by the COVID-19 pandemic. They became applicable retrospectively as from 16th March 2020.

IMPACT ON CREDITORS AND SHAREHOLDERS

On 24 February, the Government published draft regulations that, if implemented, will impose new restrictions on pre-pack administration sales to connected parties. For all `substantial disposals' (which will include `pre-pack' sales) to connected parties, taking place within eight weeks of the administrators' appointment, the administrators will either need creditor consent or a report from an independent `evaluator'.

Context

Now that the UK has left the EU and the transition period ended on 31 December 2020, this briefing considers the key points of the legal and regulatory landscape from the perspective of Ireland.

Deal or no-deal?

In effect, there is both. The December 2020 EU-UK Trade and Cooperation Agreement¹ (the “TCA”) includes a ‘deal’ so far as concerns EU-UK trade in many types of good. However, the TCA makes little provision for trade in services and so, broadly, it is ‘no-deal’ as regards most types of service.

With tech now more vital than ever for most businesses, the failure of an IT service provider can be catastrophic. As businesses suffer from the knock-on effects of the pandemic and insolvencies look set to increase, it is important for businesses to protect themselves as far as possible in their commercial relationships.

Protection for both the IT service provider and the business comes from the contract they enter into with each other. We take a look at the key points to consider.

IT service providers

Key Takeaways

Some interesting recent scheme and plan law of late, proving that schemes and plans continue to be popular restructuring tools for all types of companies and international groups.

DeepOcean companies (Part 26A plans) – January 2021

This was the first time that the court had to consider the application of the new ‘cross-class cram down’ procedure under Part 26A. Trower J approved the plans proposed by three DeepOcean companies but had reserved judgment and in late January handed down a written judgment with important guidance for future plans.

SUMMARY