Q&As

What considerations should practitioners be taking into account when deciding whether or not the provisions on ipso facto clauses introduced by the Corporate Insolvency and Governance Act 2020 apply to agency, introducer, or commission agreements?

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Produced in partnership with Lynne Counsell of 9 Stone Buildings
Published on LexisPSL on 10/08/2020

The following Commercial Q&A produced in partnership with Lynne Counsell of 9 Stone Buildings provides comprehensive and up to date legal information covering:

  • What considerations should practitioners be taking into account when deciding whether or not the provisions on ipso facto clauses introduced by the Corporate Insolvency and Governance Act 2020 apply to agency, introducer, or commission agreements?
  • Corporate Insolvency and Governance Act 2020
  • Ipso facto clauses
  • Considerations for the practitioner

What considerations should practitioners be taking into account when deciding whether or not the provisions on ipso facto clauses introduced by the Corporate Insolvency and Governance Act 2020 apply to agency, introducer, or commission agreements?

Corporate Insolvency and Governance Act 2020

The object of the Corporate Insolvency and Governance Act 2020 (CIGA 2020) was to avoid insolvency and assist businesses to continue operating during the coronavirus (COVID-19) pandemic and ensuing economic uncertainty. The UK government published the Corporate Insolvency and Governance Bill on 20 May 2020. It went through the accelerated Parliamentary process and received the Royal Assent on 25 June 2020.

The main parts of CIGA 2020 consist of the following:

  1. a new moratorium whereby the formal insolvency process is suspended

  2. a new restructuring plan for companies in financial difficulty whereby a company and its creditors (and/or members) can agree a plan for the purpose of reducing, preventing or mitigating its financial difficulties

  3. a prohibition on the issue of statutory demands and winding up petitions relating to debts arising from coronavirus

  4. suspension of the wrongful trading provisions

  5. protection of the supply of goods and services by preventing termination on the grounds of insolvency

See News Analysis: Corporate Insolvency and Governance Act 2020.

Ipso facto clauses

CIGA 2020, s 14 deals with the supply of goods and services and ipso facto clauses. An ipso facto clause is a provision in

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