Although Japan has so far been successful in keeping COVID-19 cases relatively low, the economy has been heavily hit by the COVID-19 pandemic and the government’s request for self-restraint. The number of bankruptcy cases in Japan has been increasing due to such economic impact and unfortunately, the number is expected to continue to grow in various industries. This Newsletter provides an outline of general bankruptcy proceedings in Japan and the impact of COVID-19 on bankruptcy practice.

Overview of Bankruptcy Proceedings in Japan

On 1 August 2020, the Companies (Miscellaneous Provisions) (COVID-19) Act 2020 (Act) was signed into law. This legislation, due to commence soon, will address certain specific company law issues arising because of the ongoing and unprecedented Coronavirus (COVID-19) crisis.

General Meetings

What is it and what has changed?

Wrongful trading is a term that has received quite a bit of press over the last few months, mainly through the headlines generated by the UK Government’s unprecedented amendment to the wrongful trading provisions contained within our insolvency legislation.

But what exactly is wrongful trading and what has changed?

We live in uncertain and financially very troubling times. The coronavirus pandemic and the unprecedented measures put in place to tackle it have caused severe disruption to businesses. Big names such as Harveys, TM Lewin, Intu and the owners of Café Rouge and Bella Italia all went into administration at the beginning of the month. They will not be the last.

A recent case in the NSW Court of Appeal clarifies the purpose, and limits, of a public examination summons

In Short

The Situation: When determining and quantifying unfair preference claims in Australia, does the Corporations Act permit liquidators to value transactions forming part of a single "continuous business relationship" (such as a running account) from the point of peak indebtedness, even if doing so disregards earlier transactions that might act to reduce the value of the claim against the creditor?

Nearly two years after it was first passed in Parliament on 1 October 2018, the Insolvency, Restructuring and Dissolution Act (“IRDA”) has now come into operation on 30 July 2020. The IRDA not only unifies Singapore’s legislation in relation to personal and corporate insolvency and debt restructuring, but also introduces significant changes to the present regime.

In this update, we will highlight nine key changes of the new provisions of the IRDA.

1. Restriction of Ipso Facto Clauses in Insolvency/Restructuring Proceedings

In the table below, we have summarised the key differences between the remedies available to distress company which is unable to pay monies to its creditors.

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COVID-19: LEGAL & REGULATORY CHANGES

CORPORATE INSOLVENCY AND GOVERNANCE ACT 2020 IN FORCE

The rapid onset of the COVID-19 pandemic, coupled with the drastic lockdown restrictions, has left many businesses – particularly those that rely on heavy footfall – in dire financial circumstances.

Businesses are therefore seeking tools to help them weather this storm and light-touch administration is an option that continues to rear its head.

What is it?