The Corporate Insolvency and Governance Bill has been introduced to Parliament. MPs will consider all stages of the Bill on 3 June 2020 and it will then progress to the House of Lords. The Bill is subject to the fast-track procedure as it aims to give companies flexibility and breathing space to continue trading in the COVID-19 crisis rather than entering into insolvency.

In addition to the crisis-related measures, there are three key areas of the Bill which will affect financial services companies and their arrangements with customers:

As businesses experience diminishing revenues, falling stock prices, and other economic hardships resulting from Coronavirus Disease 2019 (COVID-19), some economists project the possibility of an unprecedented number of business bankruptcies. Some of these businesses own brands, and some have entered into relationships, most commonly trademark licenses, under which they allow others to use their brands. What happens to a trademark license when a brand owner becomes insolvent, particularly in the context of a reorganization under Chapter 11?

As the business world starts to count the cost of the COVID-19 pandemic and the government measures taken to contain it, attention is turning to the tools available to help companies that have been financially impacted.

Many companies are deferring payments to conserve liquidity, raising difficult questions around directors’ duties and leading to an immediate focus on how to protect the business from resulting creditor action.

The English Court of Appeal has handed down its judgment in the Debenhams case, on which we acted. A copy of the judgment can be downloaded here. This upholds the decision of the High Court, which followed the earlier decision in Carluccio’s.

On April 20, 2020, Massachusetts Governor Charlie Baker signed legislation suspending evictions of many residential and commercial tenants as well as halting the foreclosure of most residential properties. The new law, Chapter 65 of the Acts of 2020, “An Act providing for a Moratorium on Evictions and Foreclosures During the COVID-19 Emergency,” takes effect immediately and will remain in place until the earlier of August 18, 2020 or 45 days after Governor Baker lifts the Coronavirus Disease 2019 (COVID-19) emergency declaration.

The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), signed into law March 27, 2020, and the Small Business Reorganization Act of 2019 (SBRA), which went into effect Feb. 19, 2020, provide options for small business debtors considering chapter 11 bankruptcy protection. Designed to alleviate costs and create greater efficiencies in the chapter 11 process, the SBRA was modified by the CARES Act to raise the maximum qualifying debt level from approximately $2.7 million to $7.5 million, through March 27, 2021.

This note sets out the duties of the following directors of French companies with a particular focus on the duties owed by such directors of companies in financial difficulties:

The declaration of the state of emergencybecause of the COVID-19 crisis will significantly increase the number of applications for insolvency in Spain.

Measures proposed by the General Council of the Judiciary (Consejo General del Poder Judicial) (GCJ) are designed to streamline insolvency proceedings in order to facilitate the continuity of the business activity of insolvent companies or, at least, to enable them to obtain the maximum performance from the sale of their assets.

In this context, the GCJ measures appear to be based on two principles:

Enacted March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) places short-term obligations and restrictions on lenders and servicers of federally backed loans. As part of these limitations due to Coronavirus Disease 2019 (COVID-19), lenders and servicers are temporarily subject to moratoriums on foreclosures, mandatory forbearance obligations, and revised credit reporting obligations.

As part of the package of measures to mitigate the effects of the corona crisis, the German Bundestag has fast-tracked an act to mitigate the consequences of the COVID-19 pandemic in civil law, insolvency law, and the law on criminal procedure, adopting it into law on 25 March 2020. 

The act contains a civil law moratorium that benefits parties who owe certain forms of contractual performance where the COVID-19 pandemic has forced them into the position that they cannot meet their contractual obligations.