We are pleased to announce the publication of the third edition of the Herbert Smith Freehills Guide to Restructuring, Turnaround and Insolvency, Asia Pacific.
Against a backdrop of the COVID-19 pandemic and the resulting economic downturn, we are seeing companies and lenders respond to a new and challenging business environment. The challenges associated with this new environment are further exacerbated as the influencing factors change in nature and intensity.
The Australian Federal Government has announced significant insolvency law reforms that will affect small businesses with liabilities of less than $1 million. The reforms are expected to commence on 1 January 2021 and will introduce, among other measures, a new debt restructuring process and liquidation pathway for small businesses which the Government intends to be simpler, more flexible and more efficient than existing processes.
In brief
The Australian Federal Government has announced the temporary amendments to insolvency and corporations laws will be extended until 31 December 2020 in light of the continuing challenges of COVID-19.
In brief
We are still in the early days of the economic shock of the coronavirus, with positive trends not yet clear. Restructuring specialists at Keystone Law have combined our experiences of enquiries from businesses, Insolvency Practitioners (IPs) and other stakeholders during lockdown and noted the following developments which will help businesses and advisors prepare for a post-lockdown business environment:
The Australian Federal Government has now passed temporary amendments to insolvency and corporations laws in light of the challenges COVID-19 poses to many otherwise profitable and viable businesses.
Businesses will be considering dramatic changes over the next few days and weeks. The Government last week closed certain business such as pubs, theatres, restaurants and cinemas. Last night, the Government went further and ordered that all non-essential retail businesses and hotels should close and that people should not leave their homes to work unless it absolutely cannot be done from home.
The Australian Federal Government has announced today (22 March 2020) that it intends to make temporary amendments to insolvency and corporations laws in light of the challenges COVID-19 poses to many otherwise profitable and viable businesses.
In particular, the government intends to relieve directors from the risk of personal liability for insolvent trading, where the debts are incurred in the ordinary course of business.
The Australian Federal Government has announced today (22 March 2020) that it intends to make temporary amendments to insolvency and corporations laws in light of the challenges COVID-19 poses to many otherwise profitable and viable businesses.
In particular, the government intends to relieve directors from the risk of personal liability for insolvent trading, where the debts are incurred in the ordinary course of business.
With coronavirus causing unprecedented distress to the whole global economy, all types of business in every sector will be affected. These are not normal times, and it is clear that all businesses will need to formulate coherent action plans to survive. The Government appears to be working on emergency plans to provide help to trade and industry that has already been badly affected by underlying economic uncertainties. More high-street names have closed their doors this week.
Retail, as a sector, has long been under pressure from increased competition from online retailers, which has resulted in reduced footfall on the high street, affecting many companies, including many well-known names.
Between 2016 and 2019, 13 of 23 company voluntary arrangements (CVAs), which are used by UK businesses to reduce their debts, saw their group going into administration, while other companies that did not agree a CVA ended up seeking investors to buy the business.
What is a CVA?