Industry bodies and professional groups have welcomed the Irish government’s approval to fast track legislation that will make it cheaper and easier to restructure the debts of small companies at risk of insolvency, the Independent reported. The Companies (Small Company Administrative Rescue Process and Miscellaneous Provisions) Bill 2021 will amend the Companies Act 2014 to provide for a new dedicated rescue process for small and micro companies.
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Ireland
The Irish government is to introduce new legislative reforms over the medium term to enhance the rights of employees facing collective redundancies following insolvency, the Irish Times reported. In a new action plan, the Department of Enterprise and Employment says that in future workers affected by collective redundancy will in all cases have to receive 30 days’ notice.
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The Irish High Court has appointed a provisional liquidator to a shipping company which claims it has become “hopelessly insolvent” due to apparent fraud by its managing director, the Irish Times reported. The order was made in relation to a Co Louth-based freight forwarding business, Fast Shipping Ireland Ltd, which employs nine people. Following an investigation into its financial affairs, the company claims its currently suspended managing director, Simon Mulvany, used its monies for his own benefit, including the purchase of two racehorses.
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The Irish High Court has overturned an order requiring bankrupt businessman Sean Dunne to pay €7,000 a month for the benefit of creditors in his Irish bankruptcy, the Irish Times reported. On the basis of evidence, including that Mr Dunne’s net personal income for a 25-month period is €1,371 monthly, that he cannot access his pension until aged 70, and that the income of his children, of whom he is the sole carer, cannot be treated as his income, Mr Justice Richard Humphreys set aside the Bankruptcy Payment Order (BPO).
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Ulster Bank swung into an operating profit of €13 million in the Republic in the first quarter of the year as it freed up money that was previously set aside to cover bad loans, while its U.K. parent said that plans to wind down the unit over the coming years remain “on track,” the Irish Times reported. The Dublin-based lender’s loan book dipped by €200 million to €19.8 billion during the first three months of the year, as loan repayment outpaced new lending, while deposits dipped by €100 million to €100 million to €21.7 billion, driven by a reduction in commercial balances.
The proportion of businesses in the Republic availing of COVID-related income supports or wage subsidies peaked at 57 percent last April, according to the Central Statistics Office (CSO) and reported by The Irish Times. It fell to a pandemic low of 30 percent in September before rising again to 45.6 percent or 113,000 in January this year.
The Irish High Court has approved a survival plan for the troubled airline Norwegian Air and related companies, the Irish Times reported. In a written decision Mr. Justice Michael Quinn said he was satisfied to approve the scheme put together by the airline’s examiner Kieran Wallace of KPMG. The airline’s Oslo-based parent company and several of its Irish-registered subsidiaries had sought the protection of the Irish courts due to factors including the devastating impact that the Covid-19 pandemic has had on the airline industry and international travel.
The governor of the Central Bank of Ireland has warned that many Irish firms will not survive the pandemic, and will no longer be viable once State supports are removed, the Irish Times reported. “The viability and survival prospects of many affected firms remains highly uncertain, and is likely to depend on a range of future policy choices,” Gabriel Makhlouf told a webinar event hosted by the University of Limerick.
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New proposals to rescue Irish small businesses in the wake of the Covid-19 crisis must focus on those with viable futures, a leading insolvency practitioner has warned, the Irish Times reported. The Company Law Review Group (CLRG) has been seeking views on proposals for a scheme to rescue financially-troubled small businesses that avoids the need for court hearings but, like examinership, gives the enterprise temporary protection from creditors.
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