Corporate Insolvency and Governance Act
From ACT Wiki
Law - UK - insolvency - COVID-19.
The UK's Corporate Insolvency and Governance Act 2020 was enacted in response to COVID-19.
It also accelerated a number of other reforms to UK insolvency law.
Among other changes, the Act:
- Introduced a credit moratorium for businesses, to give them more time to seek a rescue.
- Prohibited termination clauses engaging on insolvency, to prevent suppliers ceasing supply or asking for additional payments while companies enter rescue proceedings.
- Introduced a new business restructuring plan procedure.
- Temporarily removed the threat of personal liability for wrongful trading for directors seeking to keep companies afloat during the crisis.
- Temporarily prohibited creditors from filing statutory demands or winding up petitions for COVID-19 related debt.
The temporary measures were orginally scheduled to end on 30 September 2020.
They were subsequently extended to 31 December 2020 and 30 March 2021, for different measures.
See also
- Balance sheet insolvent
- Cash flow insolvent
- Chapter 11
- Company voluntary arrangement
- Cost of financial distress
- COVID-19
- Creditors
- Individual Voluntary Arrangement
- Insolvency
- Insolvency practitioner
- Insolvency Service
- London Approach
- Moratorium
- Restructuring plan
- Scheme of arrangement
- Solvency
- Statement of affairs
- Statutory demand
- Termination clause
- Voluntary liquidation
- Winding up petition
- Wrongful trading
