The temporary measure allowing companies and other qualifying bodies to hold AGMs virtually will be extended until 30 December 2020. The measure, which was introduced as part of the UK Government's response to the COVID-19 pandemic, had been due to expire on 30 September 2020.

One of the first questions we are often asked by buyers in distressed M&A situations is what is the likely quantum of employee liabilities? It is not uncommon for buyers to want to restructure the workforce post-completion and early engagement on this issue is key.

Transaction structure and its impact on employment

Recent Hong Kong cases have highlighted varying approaches regarding the impact of arbitration clauses on insolvency proceedings, in particular, on the Court’s discretion to make a winding-up order where a debt is disputed.

Recent judgments have varied between the so-called Traditional Approach which requires the company-debtor to show a genuine dispute on substantial grounds and the Lasmos Approach which requires the company only to commence arbitration in a timely manner.

Summary

The Corporate Insolvency and Governance Act 2020 (CIGA 2020) came into force on 26 June 2020 after a fast-tracked consultation process. Intended to provide a lifeline to struggling businesses during the COVID-19 pandemic and beyond, it consists of temporary measures, meant to alleviate the short-term disruption caused by the pandemic and permanent measures, which are more broadly designed to assist companies in times of difficulty.

Introduction and points for consideration by trustees

Summary

As most global markets attempt a return to normal (or a new form of normal) business, it is hard to imagine a sector or an industry that isn’t already reeling from the effects of the past three months. Getting back on your feet is hard enough in the current environment, without having to worry about further setbacks impacting your business. But how would you react if your key supplier called tomorrow to let you know that they were insolvent and unable to provide you with goods or services?

For some time we have been following with interest the case of Bresco Electrical Services Ltd (in liquidation) v Michael J Lonsdale (Electrical) Ltd as it progresses through the courts. Why? Because this concerns an important question which comes up time and time again: are the regimes of construction adjudication and insolvency set off compatible?

The Corporate Insolvency and Governance Bill (the Bill) has completed all of its stages in the House of Commons, without material amendment to the Bill as originally drafted. All three readings in the House of Lords are scheduled to take place in June 2020, and expectations are that the Bill will receive Royal Assent, and will be enacted, very shortly thereafter.

Part II: Customer Considerations: Risk Mitigation = Smarter Sales

In the coming months, very few companies, whether public or private, will be able to avoid including statements in their quarterly reports or financials that attribute single or double digit percentage declines in revenue to doubtful accounts and insolvencies of major customers caused by the pandemic. For many, if not most, that disclosure will continue beyond Q4 of 2020 and through 2021.