We recently discussed the establishment of the Corporate Enforcement Authority (CEA) with effect from 7 July 2022, and the commencement of the Companies (Corporate Enforcement Authority) Act 2021 (CEA Act). With the commencement of the CEA Act, some insolvency-related amendments to the Companies Act 2014 (CA 2014) are now in force.
Directors resign for many reasons. For example, there may be disagreements among stakeholders about the future course of the company, they may be concerned about the risks associated with financial difficulty/insolvency, or they may just wish to retire.
With effect from 9 May 2022, a new Order 74C of the Rules of the Superior Courts came into operation. Order 74C facilitates the operation of the Companies (Rescue Process for Small and Micro Companies) Act 2021, which inserted a new Part 10A into the Companies Act 2014 (Part 10A).
On 11 May 2022, the Dáil and Seanad approved Ireland's opt-in to a regulation amending the Annexes to the European Insolvency Regulation, 2015/848 (EIR Recast). Regulation 2021/2260 (Amending Regulation) which replaces Annex A and B to EIR Recast came into force in January 2022.
The Corporate Insolvency and Governance Act 2020 ("CIGA") came into force on 26 June 2020. CIGA was rushed through Parliament at the very height of concerns that businesses faced a devastating economic downturn caused by the Covid-19 pandemic. CIGA has been the biggest change to the insolvency landscape since the Enterprise Act in 2003.
This is one of a series of articles we at Morton Fraser are producing to guide finance companies through the wholesale change proposed in Scots law in relation to security over goods, intellectual property and shares, on the one hand, and invoice finance or the purchase of receivables, on the other. For a general introduction to what the Bill covers, see here.
This is one of a series of articles we at Morton Fraser are producing to guide finance companies through the wholesale change proposed in Scots law in relation to security over goods, intellectual property and shares, on the one hand, and invoice finance or the purchase of receivables, on the other. For a general introduction to what the Bill covers, see here.
This is one of a series of articles we at Morton Fraser are producing to guide our clients through the wholesale change proposed in Scots law in relation to security over goods, intellectual property and shares, on the one hand, and invoice finance or the purchase of receivables, on the other. For a general introduction to what the Bill covers, see here.
With the UK Government protections to prevent a flood of corporate insolvencies all now tailing off, will 2022 see the much talked about "tsunami" of insolvencies? Market views on that are mixed but it does seem certain that there will be at least a significant upturn in insolvencies compared to 2020 and 2021. With that in mind, it's worth considering the major differences between Scotland and England when it comes to corporate insolvencies.
1. There is no Official Receiver in Scotland
The legal market in Scotland has changed over the last year, although perhaps not to the extent that anyone would have predicted. Firms have, in general terms, coped well with remote working and are beginning to cope well with hybrid working too. Traditional streams of work have been maintained and while some practice areas, such as insolvency and restructuring, have been quieter than anticipated, that has not had a significant impact on the bottom line. So, what can we expect in 2022?
1. Insolvencies will rise – even if we don’t experience the “tsunami”