The temporary restrictions on the winding up of companies were lifted on 31 March 2022. This means the legal regime governing insolvency has returned to its pre-pandemic approach.
The pre-31 March position
In a decision delivered on the 13th March 2022, case no. 246/2018 ISB, the Civil Court (Commercial Section) placed the defendant company into liquidation on the ground that it was unable to pay its debts, after considering and concluding that the circumstances that had previously led the Court in the same case to determine the existence of a bona fide dispute and consequently suspend the hearing of the liquidation proceedings, no longer existed.
Readers will recall, on April 1, 2020 the RF President signed RF Law No. 98-FZ, amending RF Law No. 127-FZ On Insolvency (Bankruptcy) of October 26, 2002 (the Law) and authorising the Government to impose a moratorium on creditors’ initiation of bankruptcies to stabilize the economy in exceptional cases (a Moratorium).
Immediately thereafter, by Decree No. 428 of April 3, 2020 as part of the COVID-19 relief program, the Government adopted such a Moratorium until 7 January 2021 (the COVID Moratorium).
As we know, the past two years have been a difficult time for many businesses and with such continuing uneconomic uncertainly, it seems there is precious little light at the end of the tunnel yet.
In this article, we consider the potential claims that might be levied at directors of an insolvent company and matters of which directors should be aware.
"Zone of insolvency”
As we previously reported, certain temporary bankruptcy code amendments that Congress originally enacted in connection with the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) expired as of
In the recent case of Baker v Financial Conduct Authority (Re Ipagoo LLP) [2022] EWCA Civ 302 the Court of Appeal has given useful guidance on the interaction of the Electronic Money Regulations 2011 (EMRs), which implemented the EU Electronic Money Directive (EMD), with the Insolvency Act 1986 (the 1986 Act), in respect of the status and basis of the Asset Pool, and the waterfall of payments where there is a distribution from an insolvent estate.
Vigilantibus, et non dormientibus, jura subveniunt is a noted maxim which means ‘the laws assist those who are vigilant, not those who sleep over their rights‘ . This is a pertinent principle which applies predominantly while determining if a particular cause of action has been espoused within the limitation period.
Two years into the pandemic, policymakers struggle to strike a balance between mitigating the ongoing human costs of the crisis and exacerbating the financial strain caused by economic support measures. The 2022 World Development Report (Report) considers the central role that finance will play in enabling countries to recover economically from the pandemic, which in 2020 caused the global economy to shrink by approximately 3% and led to the largest singleyear surge in global debt in decades.
The federal government has announced plans to further reform Australia’s insolvency laws.
On 30 March 2022, the Assistant Treasurer announced that the government intends to:
• simplify the unfair preference rules so that transactions between a company and a creditor of less than $30,000 or that are made more than 3 months before the company entered external administration aren’t able to be clawed back by the company’s liquidator
“Retail apocalypse” was the phrase coined to describe the anticipated demise of the brick-and-mortar retail store in the face of the unparalleled convenience of online shopping and other electronic commerce. Over the past decade, in response to the challenges faced by the changing retail landscape, many shopping centres tried to “e-proof” their properties by emphasizing in-person experiences that can be provided through salons, arcades, movie theatres and restaurants.