This week’s TGIF looks at a recent case where the Federal Court ordered the reinstatement of two companies to allow proceedings to be commenced against the liquidator of those companies for alleged breaches of duty (Lee v Parker [2020] FCA 1453).
Key takeaways
In late September 2020, the federal government announced that it would be introducing changes to Australia's Corporations Act (Act) and the most significant amendments to the corporate insolvency regimes in decades. The main objective is to help the small business sector deal with and overcome the economic, financial and trading challenges posed by the ongoing pandemic. Since then, the government has released its new laws via the Corporations Amendment (Corporation Insolvency Reforms) Bill 2020 (Cth) (New Laws).
Recent insolvency law reforms in the UK, Singapore and Australia impact upon the ability of a party to a construction contract to terminate it due to the other party's insolvency.
Background
Australia's largest corporate insolvency reform in 30 years is set to be introduced at the beginning of 2021. Draft legislation, which applies to small businesses, was released last week. Organisations need to familiarise themselves with the information ahead of an anticipated wave of insolvencies in 2021, as COVID-19 related government incentives cease.
Key takeouts
During the better part of 2020, the federal government has injected an unprecedented level of stimulus into the Australian economy in an attempt to mitigate the economic impact of COVID-19. As a result, despite a significant contraction in the Australian economy, roughly half as many Australian companies are entering insolvency processes today compared with the same time last year. As that stimulus is wound back, it seems inevitable that the number of insolvencies will rise.
10/14/2020 Lacunae in the Legislation: Small Business Restructuring and the Restructuring Practitioner | Mills Oakley https://www.millsoakley.com.au/thinking/lacunae-in-the-legislation-small-business-restructuring-and-the-restructuring-practitioner/ 1/32 Lacunae in the Legislation: Small Business Restructuring and the Restructuring Practitioner M e n u 10/14/2020 Lacunae in the Legislation: Small Business Restructuring and the Restructuring Practitioner | Mills Oakley https://www.millsoakley.com.au/thinking/lacunae-in-the-legislation-small-business-restructuring-and-the-restructuring-practi
In brief - A useful summary for aviation industry, finance and insolvency practitioners of the Full Court of the Federal Court's decision in VB Leaseco Pty Ltd (Admin Appointed) v Wells Fargo Trust Co, National Association [2020] FCAFC 168
This is a service specifically targeted at the needs of busy non-executive directors. We aim to give you a “heads up” on the things that matter for NEDs in the week ahead – all in two minutes or less.
In this Edition, we consider the 2020 -2021 Federal budget, the Takeovers Panel’s reasons for its Alto Metals Limited decision, the Treasury’s consultation on insolvency reforms and the new alternative JobKeeper test.
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