UK Insolvency and Governance Bill Published
05/20/2020The U.K. Government has published the U.K. Corporate Governance and Insolvency Bill. The Bill amends aspects of insolvency and company law to assist firms struggling to cope with the effects of the COVID-19 pandemic. The measures include:
- A new moratorium giving companies breathing space from creditors while they investigate rescue options;
- A prohibition on contractual termination upon insolvency clauses, preventing suppliers from refusing to supply goods while a company is going through a rescue process;
- A temporary removal of liability for wrongful trading for company directors who try to keep their businesses operating through the pandemic;
- A temporary prohibition on the filing of statutory demands and winding up petitions by creditors; and
- Temporary permission for companies to hold closed Annual General Meetings.
Financial services firms are exempt from the benefit of certain of these measures, but will have access to the Bill’s new Restructuring Plan. The Bill must now pass through the usual Parliamentary processes before being enacted.
View the announcement of the publication of the U.K. Corporate Governance and Insolvency Bill.
View details of the exemptions from the Bill for financial services firms.
Details of other regulatory responses to COVID-19 are available at our COVID-19 Research Center.
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