The first tentative steps are now being taken to ease the lockdown restrictions imposed on the nation as a consequence of the COVID-19 pandemic and thoughts are turning to how we can return to “normal”. The construction sector is no exception but finds itself in a slightly different position to many businesses as sites were never required to close (provided that work could carry on “safely”). Nevertheless the impact of COVID-19 has wreaked havoc on the finances of the construction sector and the viability of current and future projects.

The Corporate Insolvency and Governance Bill (CIGB) was introduced to Parliament on 20 May 2020 and includes measures both as a response to COVID-19, which apply temporarily, and measures which apply permanently, part of a long-planned package of insolvency reform measures.

Pursuant to paragraph 11 of the order of Mr Justice Foxton dated 20 May 2020 (the ‘Order’), the Viscount of the Royal Court of Jersey (the Fifth and Tenth Respondent) has, on the request of Harbour Fund II LP (the Seventh Respondent), instructed Addleshaw Goddard to post a copy of Schedule 4 to the Order on its website.

Schedule 4 of the Order reads as follows:

CLAIM NO: CL-2017-000323

Key insolvency provisions: a practical guide to what has changed and why

TEMPORARY PROVISIONS

1. SUSPENSION OF WRONGFUL TRADING PROVISIONS

What's changed?

Included in this update: Corporate Insolvency and Governance Bill introduced to Parliament; FRC updates guidance on corporate governance and reporting and more...

Corporate Insolvency and Governance Bill introduced to Parliament

On 20 May 2020, the Government introduced the Corporate Insolvency and Governance Bill in Parliament. The Bill is a much awaited development following the Secretary of State for Business, Energy and Industrial Strategy’s statement on 28 March 2020 announcing key measures to help businesses address the challenges resulting from the impact of coronavirus.

Financial services firms subject to special insolvency regimes supervised by the FCA, PRA, and other financial services regulators have been largely excluded by the Bill.

It has been reported that Debenhams which entered administration earlier this month for the second time will be managed as a 'light touch' administration.

In this article we look at what this actually means and whether 'light touch' administration could be a useful tool for both businesses and insolvency practitioners looking to negotiate a route through the coronavirus pandemic.

On 28 March 2020, the Government proposed certain insolvency law reforms in response to the COVID-19 crisis, including a temporary suspension of wrongful trading provisions for company directors.

The measures are intended to apply retrospectively from 1 March 2020 for three months, and aim to encourage directors to continue to trade during the pandemic.

This is the second litigation involving the furlough scheme in the insolvency context, following on from Re Carluccio's (in administration). Please refer to our note on Carluccio's for background reading on how the furlough scheme weaves into insolvency law.

Issue

In the first litigation involving the Furlough scheme, the court in Re Carluccio's (in administration) ruled on how the administrators can lawfully give effect to furlough arrangements with the employees who have agreed to the variation of their employment contract.

Read on for our analysis of the case which gives an interesting insight into how the courts in the future might interpret the furlough scheme.

1. Background

Carluccio’s in administration