The Insolvency Service has published an interim report which evaluates three permanent changes to the insolvency regime as introduced by The Corporate Insolvency and Governance Act 2020 (CIGA): restructuring plans; the standalone moratorium and the restriction on contractual termination rights (so-called ipso facto clauses). The takeaway messages are as follows:
Cryptoassets continue to be in the spotlight with prices no longer heading ‘to the moon’, the recent high-profile failure of an algorithmic stablecoin and the difficulties experienced by various service providers. This all forms the backdrop to the UK Government’s publication of proposals with respect to managing the failure of systemic digital settlement asset firms.
Overview
Insolvency figures for May 2022 were published by the Insolvency Service on 17 June, and reveal an increase in corporate insolvencies both compared to pandemic and pre-pandemic levels.
On 18 March 2021, the UK Government published its white paper on restoring trust in audit and corporate governance. On 31 May 2022, the Government published its response to the consultation.
The deadline for obtaining an order to suspend discharge from bankruptcy is absolute, as confirmed in the recent case of Paul Allen (as Trustee in Bankruptcy) v Pramod Mittal (in bankruptcy) [2022] EWHC 762 (Ch).
Background
The High Court (Mr Justice Trower) today gave its judgment sanctioning Amigo’s ‘New Business Scheme’. A team of us at Freshfields were pleased to help Amigo with this. Here we outline the technical innovations that, despite significant legal and regulatory uncertainty, delivered the best available outcome for Amigo’s redress creditors and the prospect of Amigo lending again for the benefit of those creditors and future customers. We also identify two approaches that addressed the practical challenge of implementing a complex legal process with retail creditors.
The recent company insolvency statistics for Q1 2022 show the number of company insolvencies is continuing to increase. The figures show creditors’ voluntary liquidations as being the most common procedure followed by compulsory liquidations – the number of which is more than twice as high as in the previous quarter, although still below pre-pandemic levels.
In Re Edengate Homes (Butley Hall) Limited (in liquidation) [2022] EWCACiv 626, the Court of Appeal considered a challenge to an assignment of claims by a liquidator.
Government-backed loan schemes implemented to assist ailing businesses during the pandemic have been subject to widespread abuse. An estimated £4.9bn of the £47bn invested in business support loans during the life of the pandemic is thought have been lost to fraud and up to £17bn may never be repaid. In response to concerns about potential abuse of limited company liability, new legislation received Royal Assent on 15 December 2021 - The Rating (Coronavirus) and Directors Disqualification (Dissolved Companies) Act 2021 (the Act).
The deadline for obtaining an order to suspend discharge from bankruptcy is absolute, as confirmed in the recent case of Paul Allen (as Trustee in Bankruptcy) v Pramod Mittal (in bankruptcy) [2022] EWHC 762 (Ch).
Background