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Amends to insolvency laws to support businesses amid coronavirus (COVID-19)

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Published on: 02 April 2020

Published by LNB News

LNB News 02/04/2020

Document Information

Issue Date: 02 April 2020

Published Date: 02 April 2020

Jurisdiction(s): England, Northern Ireland, Scotland and Wales

Article summary

The House of Commons Library has released a briefing paper that considers the new insolvency measures announced by the government to help businesses continue to trade during the coronavirus (COVID-19) pandemic. Legislation will be introduced to parliament to amend insolvency laws. The proposal is to retrospectively suspend wrongful trading provisions for three months from 1 March 2020 in order to remove the threat of directors incurring personal liability while trading. All other ‘checks and balances’ which help ensure directors fulfil their legal duties will remain in force. Other measures include allowing companies access to essential supplies while attempting to rescue business and companies undergoing a restructuring process being given a time limited moratorium action.

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