The Commodity Futures Trading Commission proposed its first comprehensive overhaul of its bankruptcy rules since 1983. The recommended new rules do not substantively change anything but codify many CFTC interpretations and views developed over 40 years and refresh references to means of communication and recordkeeping practices to reflect current norms.
A government press release issued on 23 April 2020 will be welcomed by commercial tenants up and down the country, particularly those in the retail and leisure industries, but it will not make such welcome reading for landlords.
In the current climate many commercial tenants are having a difficult time and consequently so too are landlords. The government has urged landlords and investors to work collaboratively with high street businesses which have found themselves unable to pay their rent during the COVID-19 pandemic.
At the Commodity Futures Trading Commission (CFTC) open meeting on April 14, the CFTC unanimously approved proposed amendments to Part 190 of its rules governing bankruptcy proceedings of commodity brokers, including futures commission merchants (FCMs) and derivatives clearing organizations (DCOs). The proposed amendments are intended to comprehensively update Part 190 to reflect current market practices. Among other revisions, the proposed amendments to Part 190 would:
Background
In the 2018 Autumn Budget, the Chancellor announced his intention to reintroduce Crown Preference with effect from 6 April 2020. Due to the attempts to prorogue Parliament and the General Election last year, the necessary legislation was not passed. However, it has now been introduced in the Finance Bill 2020, with the later start date of 1 December 2020.
Cash flow and current and future liquidity are now real concerns for many businesses during this COVID-19 pandemic. Increasingly, the attention of directors and the wider economic ecosystem is turning to consider the issues of approaching insolvency and the duties of directors.
In line with the current approach of the UK Government to support businesses, on Saturday, 28 March, the Business Secretary, Alok Sharma, announced that UK wrongful trading insolvency laws are to temporarily change to help give businesses and directors some "breathing space".
Despite what seemed like three months ago to be something only happening a very long way away, and would hopefully dissipate as quickly as it started, the Coronavirus pandemic has well and truly arrived on our shores.
Daily news reports are revealing the far-reaching effects of the outbreak, the likes of which have not been seen for generations. In what form, and to what extent, the health, financial and social implications will be in the aftermath of the pandemic remain an unknown quantity for us all.
Four months on from our inaugural newsletter – and where do we start??
Theresa out, Boris in; champagne super overs at Lords; hottest bank holiday on record; largest ever peacetime repatriation (of holidaymakers); Parliament unlawfully prorogued; Brexit on hold (again); and a general election two weeks before Christmas. It’s been anything but dull.
The team have been equally as active in the same period, having seen a significant influx of new work. Amongst the main highlights were:
The press reported recently that British Steel Limited had been placed into compulsory liquidation putting 5,000 jobs at risk. The Official Receiver took control of the company as part of the liquidation process. We understand that British Steel Limited continues to trade normally, but the limited company was transferred to the Official Receiver because the company did not have sufficient funds to pay for an administration.
A statement from the Official Receiver reported
In an effort to think about something other than Brexit, the Business Support & Insolvency team at Boyes Turner have put together a snap-shot of some of the significant updates which have happened in the world of insolvency (as well as in the team) in the last quarter.
What have we been up to?
In an 8-1decision issued on May 20, the Supreme Court held that rejection of an executory trademark license agreement in a bankruptcy of the licensor is merely a breach, and not a termination or rescission, of the agreement. The licensee retains whatever rights it would have had upon a breach of the agreement prior to bankruptcy and can continue to use the trademarks pursuant to its contractual rights under applicable law. Mission Product Holdings, Inc. v. Tempnology, LLC, 587 U.S. ___, No. 17-1657 (May 20, 2019).
Background