European Real Estate Finance: Market Update – Q1 2021 March 2021 Authors: Jeffrey Rubinoff, Dr. Thomas Flatten, Thierry Bosly, Hadrien Servais, Carl Hugo Parment, Fernando Navarro, Christophe Goossens, Julio Peralta, Angel Calleja, Aurélie Terlinden, Alexandra Stolt, Amitaben Patel & Brendon Vyas Further information on the response to COVID-19 can be found here, and we also have a German-language article, available here, looking at the impact on commercial leases. LIBOR Discontinuation Much has happened in the world of LIBOR Discontinuation since our last update.
The Government has issued a consultation paper regarding statutory audits and financial reporting. The consultation makes proposals in relation to four areas, namely directors, auditors and audit firms, shareholders and the audit regulator.
In addition to the extension to the commercial eviction ban until 30 June 2021, the UK Government has now also extended the moratorium on commencing winding-up proceedings until 30 June 2021.
You may view the regulation from the UK Government at gov.uk.
Asenior employee of a company no matter how malfeasant, fraudulent, dishonest, incompetent, or inept they have proved themselves to be in the performance of their role cannot be disqualified under section 6 of the Company Directors Disqualification Act 1986 unless they were one of the company's directors or shadow directors.
In the world of companies, therefore, disqualification for unfitness following insolvency is the sole preserve of directors and those in accordance with whose direction or instruction the directors are accustomed to act.
BITE SIZE KNOW HOW FROM THE ENGLISH COURTS
The Commercial Disputes Weekly will be taking a short break, returning on 6 April.
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Recently, the Supreme Court in the decision of Arun Kumar Jagatramka v. Jindal Steel and Power Ltd. & Anr1 (“Arun KumarDecision”) examined the interplay between liquidation proceedings under the Insolvency and Bankruptcy Code, 2016 (“IBC”) and Section 230 of the Companies Act, 2013 (“Act”). The issue before the Supreme Court was to decide whether a person ineligible to submit resolution plan under Section 29A of the IBC is barred from proposing a scheme under Section 230 of the Act.
Amplifying JCAM Commercial Real Estate Property XV Ltd v Davis Haulage Ltd [2018] EWCA CIV 276 the court has again considered repeated Notices of Intention to Appoint (NOITA) and the effect on the interim moratorium.
Background
This case involved the Company filing 4 successive NOITAs although only two of them were the subject of these proceedings (NOITA 1 and NOITA 2).
The Company owned a Property which was subject to a legal mortgage and QFC. The secured loan was in default and the Company was seeking to delay enforcement whilst it refinanced.
The Small Business Reorganization Act of 2019 (“SBRA”) took effect in February 2020. The SBRA gives small businesses new forms of bankruptcy relief that were not previously available to them under federal law, including the ability for business owners to retain ownership of their businesses without first paying their creditors in full.
Unlike the GFC, which was essentially a liquidity crisis, Australia is likely to face a gradual increase in business insolvencies, rather than the feared ‘insolvency cliff’, as the Federal Government’s COVID-19 stimulus measures are wound down at the end of March.
The Australian government has taken swift action to enact new legislation that significantly changes the insolvency laws relevant to all business as a result of the ongoing developments related to COVID-19.