On 8 October 2020, the UK Government published draft regulations applying to sales in administration by way of a 'pre-pack' to a connected party purchaser.
UK pre-pack administrations
A pre-pack administration is where:
On 6 September 2020, the England and Wales High Court approved the second scheme of arrangement proposed by Codere (an international gaming group) in a little over five years, following a fully contested convening hearing spread over three days.
In the convening judgment ([2020] EWHC 2441 (Ch)), the Court concluded that the various fees payable to the members of an ad hoc committee of scheme creditors did not fracture the single class proposed by Codere.
On 26 June 2020 the Corporate Insolvency and Governance Act 2020 (the Act) came into force. The Act included far-reaching wholescale reforms to the UK’s restructuring toolbox, including the introduction of the restructuring plan, which has the potential to be a gamechanger for restructurings.
It also included temporary measures dealing with COVID-19 impacts on companies. The two most significant temporary measures for companies facing financial difficulties as a result of the COVID 19 pandemic were:
As the coronavirus pandemic began spreading through Europe in the early months of 2020, the authorities had little idea of how best to respond – both to the virus itself, and its impact on livelihoods and businesses.
But since then, Europe’s major economies have introduced a suite of measures to contain COVID-19’s spread and keep the economic fallout from social restrictions to a minimum.
In March 2020, Business Secretary Alok Sharma announced that provisions on wrongful trading would be suspended. The move came as part of a wider package of measures that sought to provide assistance to businesses – and their beleaguered boards – experiencing financial distress due to Covid-19.
Now set out in the Corporate Insolvency and Governance Act 2020 (CIGA), which was passed on 26 June 2020, the provisions adapt the wrongful trading regime making directors’ liability for the “relevant period” unlikely.
Why does it matter?
On 26 June 2020 the Corporate Insolvency and Governance Act (CIGA) came into force. The CIGA has made both permanent and short-term changes to the insolvency regime in response to the coronavirus pandemic and its consequences.
Why does it matter?
One of the permanent reforms provides that a contractual term of a contract to supply services or goods will be ineffective if:
The Abu Dhabi Global Market (ADGM)continues to enhance its legislative framework after recently publishing its fourth round of amendments to the ADGM Insolvency Regulations 2015.
As part of the latest round of amendments, the ADGM has introduced a new chapter dealing with priority funding (PDF), similar to US Chapter 11 style debtor-in-possession (DIP) funding.
On 26 June 2020 the Corporate Insolvency and Governance Act 2020 (the Act) came into force. The Act marks the most significant insolvency reforms in a generation. It doesn’t just deal with measures required to tide companies through the COVID-19 pandemic but includes far-reaching wholesale reforms to the UK’s restructuring toolbox, including the introduction of the restructuring plan, which has the potential to be a gamechanger for restructurings.
There are two temporary measures dealing with COVID-19 impacts on companies specifically:
The new Corporate Insolvency and Governance Bill (the Bill) has been introduced into the UK Parliament and proposes significant changes to insolvency law, including:
In March 2020, the UK government announced that changes will be made to enable UK companies undergoing a rescue or restructure process to continue trading, giving them breathing space that could help them avoid insolvency.
The legislation implementing this has now been laid before Parliament in the Corporate Insolvency and Governance Bill. This includes measures intended to tide companies through the COVID-19 pandemic, as well as far-reaching wholesale reforms to the UK’s restructuring toolbox.