Davies Restructuring Review 2021: Issue 1 Contents The Insolvency Landscape One Year into the COVID-19 Storm 01 Global Outlook on Corporate Insolvency: Lessons from Past Crises?
Although 2020 may be behind us, the economic conditions and lockdowns caused by the COVID-19 pandemic still linger. With the emerging picture for Canada in 2021 looking to largely resemble that of 2020, many are wondering how long struggling businesses and their creditors can hold their breath while waiting for improved cash flows and customer demand.
Canadian Insolvency Trends in 2020: A Pandemic Year in Numbers Contents Introduction 01 Insolvencies in Canada in 2020: The Numbers Explained 02 Bankruptcies and Proposals in a COVID-19 World: A Snapshot 03 The Hardest Hit Sectors 06 Trends in Business Bankruptcies 08 Trends in Business Proposals 09 A Look at Receiverships 10 Developments in CCAA Filings 14 CBCA Section 192 Arrangements 16 Looking Ahead 17 Contributors 18 Key Contacts 19 Canadian Insolvency Trends in 2020 1 Introduction The economic conditions caused by the COVID-19 pandemic are unprecedented.
The Treasurer has announced major proposed reforms to Australia’s insolvency framework aimed at facilitating the restructuring of small to medium businesses (MSMEs) and streamlining their liquidation if rescue is not achievable (Reforms). The Reforms are intended to come into effect from 1 January 2021, after the suite of current insolvency protections introduced to address the economic impact of COVID-19, expire on 31 December 2020.
Introduction
Parliament passed on July 27, 2020, the Time Limits and Other Periods Act (COVID-19) (Time Limits Act), which we summarized in a previous bulletin. Briefly, the Time Limits Act automatically suspends statutory time limits for federal civil proceedings for six months and grants federal ministers the power to issue orders extending statutory and regulatory time limits in a range of areas.
The Australian Government has announced that the operation of temporary COVID-19 relief measures for businesses in the hope of aiding distressed companies and preventing further economic breakdown will be extended until 31 December 2020.[1]
In its recent judgment involving the PAS Group of companies[1], the Federal Court held that rent payable by the PAS Group during an extension of the period in which an administrator had been excused from personal liability (Standstill Period) is an expense properly incurred by a ‘relevant authority in carrying on the company’s business’ and is therefore a priority debt under s 556(1)(a) of the Corporations
Dans une décision unanime rendue le 20 juillet 2020, la Cour d’appel du Québec (la « CAQ ») met un terme à une controverse jurisprudentielle concernant la mise en œuvre au Québec du régime de séquestre prévu à la Loi sur la faillite et l’insolvabilité (la « LFI »). La CAQ confirme qu’il est possible pour un créancier garanti d’obtenir la nomination d’un séquestre au terme de la LFI, mais que les exigences de fond et de procédure prévues au Code civil du Québec (le « C.c.Q.
The Supreme Court of New South Wales has helpfully given guidance to the liquidators of the RCR Tomlinson Group on a number of unsettled questions that have challenged insolvency practitioners (particularly liquidators of construction companies) when assessing whether certain intangible rights and assets are circulating assets.
The questions include:
This week, the Federal Court published judgments in three unfair preference claims brought by the liquidators of the Gunns Group. We acted for the liquidators in each proceeding.