The Corporate Insolvency and Governance Bill is currently being fast-tracked through Parliament, but is the Government making a mistake in seeking to combine a short-term breathing space for businesses during the current Covid-19 crisis with introducing the greatest changes we have seen to UK insolvency laws for decades?
Whilst the government has taken significant steps to help protect businesses from collapsing as a result of the current pandemic, it is evident that companies across the board are acutely aware that such protection cannot last forever.
We now have further evidence of the court's willingness to act within the spirit of the Corporate Insolvency & Governance Bill ("CIG Bill").
Under English law, there is no common law right to terminate a contract on a counterparty’s insolvency. As a result, in all well-drafted commercial contracts it common to see a contractual right to terminate on the event of a party’s insolvency.
Preparation of financial statements and corporate income tax, recommencement of time periods, remote trials, gradual return to workplaces, insolvency proceedings and compliance with criminal law
Los plazos administrativos se reanudarán el próximo 1 de junio, mientras que los plazos procesales y sustantivos lo harán el 4 de junio, tal y como aparece contemplado en el BOE del 23 de mayo de 2020.
New guarantee facility, extension of ERTE temporary layoff procedures, effects of the crisis on transfer pricing, return to judicial activity and ‘shields’ for businesses.
Esta semana cabe destacar la nueva línea de avales, la prórroga de los ERTE, los efectos de la crisis en los precios de transferencia, la vuelta de la actividad judicial y los posibles ‘escudos’ para empresas en dificultades.
The Government has announced proposals for retrospective changes for the urgent reforms to UK insolvency law, designed to protect companies and their directors during the COVID-19 outbreak.
Wrongful trading
These changes will include a temporary suspension (to the end of June 2020) of section 214 Insolvency Act 1986 in relation to wrongful trading, subject to passage of the upcoming Corporate Insolvency & Governance Bill through Parliament in the coming weeks.
Background: Financial Backdrop
The Stats