Today, new legislation comes into force* that provides directors of companies in financial difficulty with a second breathing space from the financial impact of the wrongful trading provisions.
On 26 June 2020, the Corporate Insolvency and Governance Act 2020 (Act) came into force with changes to insolvency law to help businesses manage the economic implications of Covid-19. The new Act’s permanent measure on continuing supply stands out for the construction industry.
This round-up collates the information, analysis and guidance relating to insolvency issues shared by our Construction and Restructuring, Insolvency and Bankruptcy teams during the COVID-19 pandemic. For further information on any of the issues below, please get in touch with one of the Key Contacts.
The stringent regulations introduced to avoid the spread of the Coronavirus (COVID-19) pandemic caused widespread disruption across UK sites. The consequent commercial challenges were too great for some businesses − despite government measures to help those facing financial difficulty. Inevitably, insolvencies followed.
Recent changes in the Australian regulation of third-party funders will have a dramatic effect on the funding of certain disputes. Although these changes were accompanied by Government and industry commentary that they would not affect litigation funding for insolvency-related claims, this may not be the case for all insolvency funding arrangements.
Singapore confirms further widening of third-party funding options
As we head towards the last part of 2020 in the midst of a recession and some of the most challenging business conditions many have ever faced, it is worthwhile considering the aftermath of the 2008 global financial crisis. Then, in the real estate funds space, there was a shift away from pooled investments through funds and an uptick in real estate joint ventures, as investors sought to take greater control over their investments.
The United Kingdom and Australia have recently implemented legislative changes to permit external administrators to assign or sell causes of action available to them.
On 26 June 2020, The Corporate Insolvency and Governance Act 2020 (Act) became law, providing the UK (but with separate provisions for Northern Ireland) with temporary and permanent changes to insolvency law aimed at helping businesses manage the economic implications of COVID-19.
Of particular interest to the construction industry will be one of the new Act’s permanent measures relating to continuing supply.
Judgment has now been handed down by Marcus Smith J in another important case regarding the Lehman estate. This gives much needed clarity on how subordinated debts rank as between themselves.
The judgment concerned: