The Insolvency Service has recently published its interim report (the "Report") which considers the three permanent measures that were introduced pursuant to the Corporate Insolvency and Governance Act 2020 ("CIGA"). For further details on the temporary and permanent measures introduced pursuant to CIGA, see our previous update.
As outlined in our previous briefing note on the Corporate Insolvency and Governance Act 2020, a new restructuring tool was introduced in June 2020 in the form of the Part A1 free-standing moratorium (the "Moratorium").
Welcome to the sixth edition of our quarterly disputes newsletter, which covers key developments in the dispute resolution world over the last three months or so.
Since 9 January 2022, the public type of the Dutch Scheme is automatically recognized in the EU under the European Insolvency Regulation. This will be further discussed in this blog.
Last year saw the introduction of the Dutch Scheme (we refer to our previous blogs for further details on the Dutch Scheme).
The High Court has dismissed a challenge to Caffe Nero's company voluntary arrangement (CVA) in Young v Nero Holdings Limited. The Applicant in the proceedings, Mr Young, was a landlord of premises let to the First Respondent, Nero Holdings Limited (the Company) and challenged the Company's CVA under s 6(1)(a) and (b) of the Insolvency Act 1986 (the Act).
In response to the COVID-19 pandemic, legislation was introduced during 2020 to prevent creditors filing statutory demands and winding up petitions on the basis of their debtor's inability to pay its debts, unless it could be shown that non-payment was not a result of the pandemic. These temporary measures had been extended a number of times during the pandemic as businesses continued to suffer the effects of multiple lockdowns and trading restrictions, but are now gradually being phased out.
On 28 June 2021, the Minister of Justice presented a draft temporary bill on transparency of expedited liquidations (de tijdelijke wet transparantie turboliquidatie). As a result of the COVID-19 pandemic, the Minister expects that there will be an increase in the number of businesses that will need to be liquidated. Under Dutch law, the most efficient way to do this is through expedited liquidation (turboliquidatie). However, as the expedited liquidation barely provides for safeguards to creditors, it is often considered a mechanism that is open for abuse.
The UK Government has announced a further extension to certain protective measures for businesses which are currently in place in response to the COVID-19 pandemic.
During the pandemic, the UK Government has put legislative measures in place to protect commercial tenants by preventing landlords from using certain remedies such as forfeiture and winding up petitions. However, the legislation does not specifically prevent a landlord from issuing debt claims against its tenants for arrears of rent and other amounts due under a lease (see the recent case of Commerz Real Investmentgesellschaft mbh v TFS Stores Limited [2021] EWHC 863 (Ch)).