The Insolvency Service published its quarterly insolvency statistics for the period January to March 2021 (Q1 2021) on 30 April 2021. By way of comparison, see our previous update on the Q4 2020 statistics here.
The published statistics for the first quarter of 2021 continue the downward trend seen in the previous 12 month period, with company insolvencies falling overall by 22% from the previous quarter.
squirepattonboggs.com 014-5095-0428/15/EUROPE Impact of COVID-19 on Insolvency Laws: How Countries Are Revamping Their Insolvency and Restructuring Laws to Combat COVID-19 26 April 2021 squirepattonboggs.com squirepattonboggs.com Contents Around the globe, our lawyers are receiving a large number of enquiries about mitigating the impact of the coronavirus disease 2019 (COVID-19) on companies' business operations and finances. Governments in several countries have reacted quickly to try to mitigate COVID-19's impact by changing or amending their insolvency laws.
The National Company Law Appellate Tribunal (NCLAT) has held that priorities amongst the secured creditors (first charge or second charge) will not prevail in distribution of assets in liquidation, in a case where the creditors had elected for relinquishment of security interest and for distribution of assets according to Section 53 of the Insolvency and Bankruptcy Code, 2016.
The COVID-19 pandemic has created unprecedented challenges for businesses worldwide and meeting those challenges unfortunately means that in some cases, redundancies are unavoidable. Ius Laboris lawyers across the globe have compiled a set of generally applicable tips for employers facing the need to restructure their businesses.
Dos and don’ts for international employers
Introduction
On 3 May 2021, the Treasurer and Assistant Treasurer of Australia announced that, as part of Australia’s economic recovery plan, the Government would be reviewing further aspects of the insolvency laws including to “consult on improving schemes of arrangement processes to better support businesses, including by introducing a moratorium on creditor enforcement whilst schemes are being negotiated.”
The question whether the institution or continuation of a proceeding under Section 138/141 of the Negotiable Instruments (NI) Act can be said to be covered by the moratorium provision, namely, Section 14 of the Insolvency and Bankruptcy Code (IBC) has been a crucial issue in the legal domain. Various High courts have had dissenting opinion in relation to this concerning matter. However the Apex court has now put an end to all doubts and confusions.
Creditors, such as private residential landlords, are being warned about an urgent change to the arrears process, which has been brought about by the government’s Breathing Space initiative.
Breathing Space, or the Debt Respite Scheme, was launched on 4 May 2021 to give people in debt up to 60 days’ legal protection from creditors.
Pre-packaged administration sales (where a sale of key assets is agreed prior to the appointment of administrators and then implemented by the administrators immediately following their appointment), have been a widely-used and highly successful tool to rescue businesses, or parts of businesses, that may otherwise have languished in administration interminably.
Law of Limitation prescribes the time limit for different types of suits for which an aggrieved person can approach the court for redressal. For Insolvency applications, the limitation period is 3 years.
