During the UK government’s daily COVID-19 press conference on 28 March 2020, Business Secretary Alok Sharma announced that changes to insolvency laws are to be introduced at the “earliest opportunity,” to provide businesses with greater flexibility and support to “weather the storm.”
Proposed changes
The new restructuring tools include:
Amidst the uncertainty in the global capital markets introduced by the COVID-19 pandemic, many clients have begun to plan for an economic downturn. This briefing, while not exhaustive, highlights certain U.S. tax issues that clients, both debtors and creditors alike, should consider as they plan around the rapidly evolving economic environment.
Debt Restructurings and Modifications
On March 27, 2020 both chambers of the German parliament passed emergency legislation to mitigate the economic impact of the COVID-19 pandemic encompassing, inter alia, a suspension of the obligation to file for insolvency, corresponding limitations of the management’s and lenders’ liability and introduction of a moratorium on certain contractual obligations.
Healthcare workers are on the frontline of fighting COVID-19, but directors of companies have an equally important task, that of keeping the wheels turning and helping minimise the damage to the economy and the livelihoods of their employees, and keeping otherwise viable businesses intact for when the crisis passes.
How should directors respond to the fast-moving situation and the challenges posed by assessing and dealing with the impact on the business?
This article first appeared in Corporate Rescue and Insolvency (2019) 6 CRI 218.
In this journal in 2015, I wrote on the subject 'Funding insolvency litigation: a new dawn', outlining various streams of funding available to insolvency practitioners (IPs) (see (2015) 5 CRI 183). Since then, the sun has set on one era and risen again. This article considers key developments in litigation funding in recent years, as well as upcoming reforms which may further change the landscape.
Key Points
On December 20, 2019, the honorable Marvin Isgur, judge of the Southern District of Texas Bankruptcy Court, issued an opinion holding that Alta Mesa Holdings (“Alta Mesa”), an upstream oil and gas producer with operations based in the STACK formation, could not, under Oklahoma law, reject certain gathering agreements in its bankruptcy case.1 The holding in Alta Mesa follows a similar outcome issued less than three months earlier in In re Badlands Energy, Inc.,2 a case decided by a Colorado bankruptcy court applying Utah law.
The High Court decision in Re All Star Leisure (Group) Limited (2019), which confirmed the validity of an administration appointment by a qualified floating charge holder (QFCH) out of court hours by CE-Filing, will be welcomed.
The decision accepted that the rules did not currently provide for such an out of hours appointment to take place but it confirmed it was a defect capable of being cured and, perhaps more importantly, the court also stressed the need for an urgent review of the rules so that there is no doubt such an appointment could be made.
This article was updated on Jan. 9, 2020.
Retail Company Voluntary Arrangements (CVAs) are becoming an increasingly popular means of minimising liabilities and creating breathing space for tenants during a difficult trading environment on the High Street. Where does this leave landlords?