Successfully executing an acquisition from stress, distress, or insolvency requires a creative approach to reconcile competing interests.
The Corporate Insolvency and Governance Act 2020 completed ‘ping pong’ in the House of Commons on the afternoon of 25 June 2020, received Royal Assent at 18:08 the same night and took eff ect the following day, 26 June 2020.
At 254 pages, it covers a lot more than just statutory demands and winding-up petitions, including a new company moratorium procedure, but for property folk the immediate impact is that it eff ectively removes the statutory demand/winding-up route against defaulting tenants until at least 30 September.
The tragically unforeseen current novel coronavirus (COVID-19) global pandemic has brought unprecedented challenges to all aspects of Hong Kong society including the health of its citizens, the economy and the business community. Economic activities across most sectors globally are being devastated. The dire economic situation in Hong Kong has been exacerbated by the trade war between Washington and Beijing and the new national security law.
As the lockdown restrictions ease and employers slowly return to more normal ways of working, it is unfortunately inevitable that the impact of the coronavirus means some businesses will have to implement restructures and redundancies in order to survive.
This article looks at the key employment law provisions in restructuring/redundancy situations and offers practical guidance for managing these challenging processes.
Restructures and reorganisations
Background
As a result of the legal amendments on German tenancy law that were passed in March 2020 in connection with the COVID-19 pandemic, landlords are not allowed to terminate lease agreements for default of rental payments occurring in the period from April 1 to June 30, 2020, until June 30, 2022, if those defaults result from the COVID-19 pandemic.
Six key takeaways for COVID-19 Restructurings and Antitrust
Bresco Electrical Services Ltd (In Liquidation) -v- Michael J Lonsdale (Electrical) Ltd [2020] UKSC 25
Section 82 of the Coronavirus Act 2020 prevents landlords from forfeiting ‘relevant business tenancies’ until 30 June, and possibly longer. Regulations have also been made restricting the use of commercial rent arrears recovery (CRAR) during the same period, and emergency legislation is promised preventing landlords from serving statutory demands and instituting insolvency proceedings. But tenants should think twice before withholding rent and other lease payments, and landlords do not necessarily have to take a passive role.
Issuers face numerous restructuring alternatives, both within and outside the bankruptcy process