Tant au niveau fédéral que régional, les autorités belges ont introduit un grand nombre de mesures de soutien pour aider les entreprises belges à faire face à la crise actuelle du Coronavirus. Malheureusement, malgré ces mesures, il n’est pas exclu que de nombreuses entreprises ne soient plus en mesure de payer leurs dettes à court, moyen ou long terme. Jusqu’à il y a peu, ces entreprises pouvaient compter ‘uniquement’ sur la procédure de réorganisation judiciaire pour se protéger contre une faillite (imminente).

On April 24, 2020, the Paycheck Protection Program and Health Care Enhancement Act was signed into law and provided an additional $310 billion for the Paycheck Protection Program (PPP). The Small Business Administration (SBA) resumed accepting PPP loan applications on April 27, 2020. In light of the quick exhaustion of initial PPP loan funds, eligible businesses should apply for PPP loans soon to increase the likelihood of receiving available funds.

The SBA has also provided additional guidance for entities applying for loans.

Many companies are facing new and challenging circumstances given the fast-moving COVID-19 situation. It is likely that during the coming weeks you and your fellow board members will be called upon to make difficult decisions. This is a critical time during which it is imperative to ensure you are focused on the key issues and equipped to act prudently and in accordance with your duties.

What are your duties?

Un informe de la Comisión Europea, del 3 de diciembre de 2019, analiza en los marcos legales sobre insolvencia e impago de deudas de los diferentes Estados miembros y, en concreto, los distintos sistemas de ejecución –tanto individual como colectiva– y su efectividad para recuperar los créditos de dudoso cobro (NPLs).

The government has provided temporary relief against winding up petitions for companies between 23 April 2020 to 31 December 2020 (“Prescribed Duration”). This has come about by increasing the minimum amount of indebtedness needed for a deemed statutory insolvency and by exempting the compliance period for a statutory demand for payment of 21 days, and permitting compliance within 6 months. This was done by gazetting Companies (Exemption) (No 2) Order 2020 (the “Exemption Order”) pursuant to S.466 of the Companies Act 2016 (the “Act”).

While it did not focus on bankruptcy relief, the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act contained provisions relating to small bankruptcy debtors.

On 28 March 2020 the Business Secretary announced further new far-reaching measures to help businesses combat the financial impact of COVID-19.

In a welcome intervention, the Business Secretary declared it was the government’s intention to suspend wrongful trading provisions and to introduce a moratorium for businesses undergoing a restructuring process. Both measures are intended to assist companies to trade through financial distress caused by the loss of business due to the COVID-19 pandemic.

A voluntary administrator is often appointed by the company. The directors have a role in selecting the administrator; often the referral will come through one of the company’s advisers, such as the accountant or lawyer.

This quick guide summarises the duties that directors of companies incorporated in Australia are subject to, and how those duties change when a company is insolvent or at risk of being insolvent.

It also gives an overview of the personal risk to directors when a company is in financial difficulty.

This note is intended as an overview and should not be relied on as legal advice. Should you require legal advice in relation to your specific circumstances, please contact the Restructuring & Insolvency team member whose contact details are at the end of this note.

On 21 April 2020, the Russian Supreme Court issued clarifications addressing various issues related to COVID-19 (“Clarifications”).

Terms of performance of obligations

According to the Clarifications, the period from 30 March to 30 April 2020, which was declared to be non-working by the Decree of the Russian President, does not extend the terms of performance of obligations, including payment terms.

Limitation period