The COVID-19 pandemic has already led to business failures and forced others into negotiations with lenders, landlords and other stakeholders. For many sectors, the crisis has reinforced or accelerated the challenges that they were already facing. Government support measures including loans, furlough and temporary legislative changes have delayed some of the usual pressure points, but as support is eased, many businesses will have to find cash from significantly reduced turnover to satisfy deferred liabilities or repay loans.

The recent High Court decision in Hellard & Anor v Registrar of Companies & Ors [2020] EWHC 1561 (Ch) (23 June 2020) serves as a useful reminder to any party seeking the restoration of a company to the Register of Companies that it is important first to consider whether such party has the requisite standing to make the application.

This was an application by the administrators of Lehman Brothers International (Europe) Ltd for a direction under paragraph 63 of Schedule B1 IA86 that they be at liberty to consent to a request from the company’s directors to distribute surplus funds to the company’s sole shareholder.

The Court has granted one of the first Winding Up Orders under CIGA 2020.

The winding up petition had been issued on 1 May 2020, 8 weeks before CIGA 2020 came in to force, but after 27 April 2020, the date from which CIGA 2020 applies retrospectively. As a result, the petitioner could not have ensured that the winding up petition satisfied the requirements of CIGA 2020, as those requirements were not in existence at the time that the petition was presented.

The liquidators of a subsidiary company had submitted a proof in the CVA of the parent company. The proof was based upon a claim under section 239 of the Insolvency Act 1986 (IA86) that  certain payments by the parent to the subsidiary had amounted to unlawful preferences of the company. The liquidators appealed against the decision by the supervisor of the CVA to reject that proof.

Following the Insolvency Service’s announcement that it will produce monthly (as opposed to quarterly) company and individual statistics for England and Wales, to assist the Government and the insolvency sector in monitoring the impact of COVID­19, the results for July showed that:

The Department for Business, Energy & Industrial Strategy (BEIS) has recently issued a press release regarding proposed changes in the law to better protect consumers in the event that a company, and in particular a retailer, becomes insolvent.

Under existing law, if a company becomes insolvent but goods pre­paid for are still in its possession, they may be considered as assets belonging to the business and can be used by administrators to pay off the company’s debts.

So you have a freezing order against a start-up company, now what? Can that start-up use the assets which are the subject of your order, or any of its other assets, to continue to pursue its risky business, or must it stay idle and wait for the inevitable?

The tragically unforeseen current novel coronavirus (COVID-19) global pandemic has brought unprecedented challenges to all aspects of Hong Kong society including the health of its citizens, the economy and the business community. Economic activities across most sectors globally are being devastated. The dire economic situation in Hong Kong has been exacerbated by the trade war between Washington and Beijing and the new national security law.

In standard building contracts most commonly used in the UK, a party is entitled to terminate the contract if the other party is insolvent (Clause 91 of NEC3 and NEC4 and Clause 8.5 and 8.10 of JCT/SBCC).

The Corporate Insolvency and Governance Act 2020 provides measures for businesses that are designed to provide temporary reliefs during the COVID-19 pandemic, as well as permanent measures for companies in financial difficulty.