The Corporate Insolvency and Governance Bill was recently introduced into Parliament. While the effects of some of the changes proposed are intended to be only temporary, they have potential consequences for pension schemes.
Changes of particular relevance are as follows:
- Restrictions on the use of statutory demands for winding up petitions.
- New Moratorium process
- Court approved corporate restructuring plan
The Bill received its second and third readings on 3 June 2020 and will now go to the House of Lords for consideration.
In his judgment handed down on 7 May 2020 in the case of Gregory v ARG (Mansfield) Ltd [2020] EWHC 1133 (Ch), HH Judge Davis-White QC, sitting as a Judge of the High Court, commented (on an obiter basis) that where a company regulated by the Financial Conduct Authority (the “FCA”) seeks to enter administration, section 362A of the Financial Services and Markets Act 2000 (“FSMA 2000”) and paragraph 29 of Schedule B1 of the Insolvency Act 1986 (the “Insolvency Act”), require that writ
On 20 May 2020, the Corporate Insolvency & Governance Bill 2019-2021 was introduced to Parliament. With the Bill slated to be fast-tracked into law, here are some of the key insolvency aspects to be aware of.
Why now?
The government has published the Corporate Insolvency and Governance Bill which, if passed, will significantly restrict suppliers’ ability to exit commercial agreements due to restructuring or insolvency-related causes.
That the current pandemic has thrown a curveball at many businesses is a given.
At the end of February, the Bank of Scotland Business Barometer reported that overall business confidence in the UK was at a net balance of 23%. Only two months later and confidence plunged to minus 29%.
The government has introduced fundamental changes to the procedures for presenting winding-up petitions and making winding-up orders in the Corporate Governance and Insolvency Bill.
Hot off the press, yesterday we learnt a great deal more about the proposed suspension of the UK’s wrongful trading laws with the publication of the Corporate Insolvency and Governance Bill 2019-21.
Although the contentious background to the applications to restrain the presentation of two winding up petitions heard together in (but only listed singularly as) the case of Shorts Gardens LLB v London Borough of Camden Council [2020] EWHC 1001 (Ch) is somewhat unusual, these cases nonetheless raise some interesting points of principle which may be used by the courts in determining whether it is appropriate to restrain or dismiss a winding up petition due to COVID-19.
The extraordinary disruption to UK business caused by the COVID-19 lockdown has spawned much discussion about changes to existing insolvency laws to help businesses which are struggling to survive in this abnormal environment. One topic of discussion has been the so-called ‘light touch’ administration. Here we provide a quick overview of what this involves.
What do we mean by a ‘light touch’ administration?
Can a company in liquidation adjudicate? Balfour Beatty Civil Engineering Limited & Anor v Astec Projects Limited, or what happens when an irresistible force meets an immoveable object?
“Art is born when the temporary touched the eternal; the shock of beauty is when the irresistible force hits the immoveable post” G K Chesterton
“Your Courage, Your Cheerfulness, Your Resolution; Will Bring Us Victory” – Ministry of Information, 1939
The phrase “unprecedented times” seems to crop up in almost every recent article and news report and there is no doubt that it is a true statement. It is therefore rather nice that some things are reassuringly the same. This is true of my recent experience of advising on a number of adjudications, in this period of lock-down.