Hazlewoods Business Recovery and Insolvency team has been working with businesses to provide proactive and commercial advice on the options available to them for many years. During these challenging times, the Government has provided a vast range of initiatives to support businesses and individuals; the team has analysed the information as it has become available and is ready to help.
The initial framework for the Corporate Recovery and Insolvency Bill has been around for some time; however, since the start of the COVID-19 pandemic various temporary provisions have been discussed and added.
The amended bill, first presented to Parliament on 20 May 2020, is set for a second reading on Wednesday 3 June.
The bill is intended to add to the UK’s corporate recovery and insolvency framework, with some permanent additions and some temporary measures for specific COVID-19 effects.
Permanent additions include:
- A new moratorium to provide breathing space for eligible companies to seek a rescue as a going concern.
- Arrangements and reconstructions for companies in financial difficulty.
- Expansion of the protection of supplies to companies in all insolvency processes.
Temporary measures include:
- Suspension of wrongful trading actions against Directors when making their best efforts to continue to trade thorough COVID-19.
- Prohibition of petitions presented to Court to wind companies up, including those on the basis of statutory demands as a result of COVID-19 financial difficulties.
If approved, the bill will act retrospectively from the beginning of the pandemic and is likely to last until July/August 2020, depending on the date the bill is enacted, with the option for the Secretary of State to extend them for up to six months.
If you are experiencing financial difficulties or would like to discuss the options for your business, please get in touch with Pete Frost at peter.frost@hazlewoods.co.uk.