This is one of a series of articles we at Morton Fraser are producing to guide finance companies through the wholesale change proposed in Scots law in relation to security over goods, intellectual property and shares, on the one hand, and invoice finance or the purchase of receivables, on the other. For a general introduction to what the Bill covers, see here.

This is one of a series of articles we at Morton Fraser are producing to guide our clients through the wholesale change proposed in Scots law in relation to security over goods, intellectual property and shares, on the one hand, and invoice finance or the purchase of receivables, on the other. For a general introduction to what the Bill covers, see here.

As we enter a new era of ‘living with Covid’, new financial woes accompany new freedoms for many. Inflation is now at a 30-year high, with income failing to keep pace with the cost of living and interest rates rising twice in the last 4 months. A number of retailers, including Next, B&M and Greggs, have warned that soaring costs cannot be fully absorbed and will lead to price rises for consumers in 2022.

So, what is going on for retailers post-pandemic? And what steps can smaller, boutique brands take to mitigate the risks to their businesses going forward?

Following the 54% increase in the energy price cap announced by Ofgem on 3 February, and with many predicting that a second substantial increase may be required this October to keep pace with wholesale prices, what is next for beleaguered small energy suppliers?

With the UK Government protections to prevent a flood of corporate insolvencies all now tailing off, will 2022 see the much talked about "tsunami" of insolvencies? Market views on that are mixed but it does seem certain that there will be at least a significant upturn in insolvencies compared to 2020 and 2021. With that in mind, it's worth considering the major differences between Scotland and England when it comes to corporate insolvencies.

1. There is no Official Receiver in Scotland

The Insolvency Service published its latest company insolvency statistics at the end of January, reporting both on Q4 2021 as well as 2021 as a whole.

The statistics can be accessed here and we highlight some of the key takeaways below.

1. Q4 2021 Company insolvency statistics

Throughout the pandemic, a steady stream of government support was made available to prop-up businesses. As we move towards a New Normal, those support packages are being scaled-back. Many businesses are still recovering from the shock of the last 18 months and, with high levels of historic debt as an additional burden, are not yet back to full financial health.

The FCA has issued proposed guidance on its approach to compromises by regulated firms, which will have the effect of putting consumer outcomes front and centre for any firm proposing a compromise with retail customers. With a particular focus on schemes (or other compromises) relating to redress liabilities - for instance in relation to mis-selling claims - the guidance inevitably recalls many of the aspects of the ill-conceived scheme proposed by Amigo Loans last year, which the High Court ultimately refused to sanction.

Tommy Robinson, founder of the English Defence League was in court last week being pursued by the many people he owes money to. This has increased scrutiny on whether he genuinely disposed of assets in his timely divorce from Jenna Lennon.

In Re AFM (1932) Ltd (in liquidation) [2021] EWHC 3460 (Ch) the court confirmed that where an applicant is already contractually entitled – as against another party - to be reimbursed, together with interest, by that other party in an amount equivalent to the value transferred by that applicant under a related transaction, there cannot be a transaction at an undervalue pursuant to section 238 of the Insolvency Act 1986.

Facts