In this article on the changing landscape of UK fashion retail, we consider the challenges and changes faced by the industry and comment on the opportunities available for existing players and potential new entrants to the market.
The UK fashion industry is estimated to contribute over £21 billion annually to the UK economy. Of this figure, an estimated £2.5 billion comprises retail spending. With over 800,000 people employed in the industry, fashion retail is a significant and vibrant part of UK Plc.
The UK Government has reintroduced the temporary suspension of wrongful trading measures from 26 November 2020 until 30 April 2021 pursuant to The Corporate Insolvency and Governance Act 2020 (Coronavirus) (Suspension of Liability for Wrongful Trading and Extension of the Relevant Period) Regulations. The suspension was originally introduced in March 2020 under section 12 of the Corporate Insolvency and Governance Act 2020 and expired on 30 September 2020.
Intro
The UK insolvency regime has changed. Our earlier alert set out a brief overview of the changes. This is note provides more detail and flags some practical steps that the suppliers of goods and services may wish to consider.
In a nutshell
Navigating the road between regulatory compliance and business rescue
When dealing with a goods vehicle operator in an insolvency context:
European Union
Lenders contemplating potential claims against insurers of insolvent professionals will welcome the fact that the Third Parties (Rights Against Insurers) Act 2010 (2010 Act) is to finally come into force from 1 August 2016, having been updated by the Third Parties (Rights Against Insurers) Regulations 2016.
With APCOA Parking, the English High Court sets out the latest line of authority in the increasing use of schemes of arrangement by foreign companies.
This case, APCOA Parking (UK) Limited & Ors [2014] EWHC 997 (Ch), presents two novel aspects:
The onset of COVID-19 has precipitated and accelerated substantial change for businesses in fashion retail, adding to particular headwinds already facing the sector in the UK. While many brick-and-mortar fashion retailers were already experiencing challenging trading conditions at the start of 2020 – ranging from rent and rates overheads to increased online competition – restrictions on and changes to consumer preferences resulting from the pandemic have intensified the challenges facing many fashion retailers and businesses operating in the supply chain.
The rapidly changing impact of COVID-19 on companies and the wider economy presents directors with the unenviable task of balancing the immediate need to secure the survival of their company against the longer-term implications for their stakeholders. In March, the UK Government announced that wrongful trading measures would be temporarily suspended to ease this pressure. The suspension measures are included in the Corporate Insolvency and Governance Act 2020, which introduces both temporary measures, such as this, and permanent and significant changes to UK insolvency law.
Navigating the road between regulatory compliance and business rescue
When dealing with a goods vehicle operator in an insolvency context: