Reflections on COVID-19 – Views from Italy

In this blog we examine the economic impact of Covid-19 on the Italian economy, through an analysis of economic data relating to the lockdown period from February to May 2020, an assessment of the impact of the Italian government’s measures, and a view on what the future might look like for the Italian economy.

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How Do The Changes to the UK Insolvency Laws apply to Energy Companies?

As we discussed in our previous blog relating to the Supplier of Last Resort Process, energy company insolvencies bring with them a range of different processes and requirements which other companies do not need to consider.

In particular, the involvement of the Secretary of State and the Gas and Electricity Markets Authority (GEMA) in energy company insolvencies is especially notable. This month, new legislation was introduced to dictate how the Corporate Insolvency and Governance Act 2020 would interact with energy company insolvencies.

On 3 September 2020, The Insolvency (Moratorium) (Special Administration for Energy Licensees) Regulations (SI 2020/943) came into force which make modifications to how the Part A1 moratorium introduced by the Corporate Insolvency and Governance Act 2020 applies to energy companies.

The new regulations mean that directors of energy companies must notify the Secretary of State and GEMA when seeking a Part A1 moratorium, and also when a moratorium is obtained. The directors of the company must also inform the Secretary of State and GEMA about any extension or end of the moratorium.

The regulations also state that even while an energy company is still subject to a Part A1 moratorium, the Secretary of State and GEMA is still able to apply for a special administration order against an energy company.

Part 1A moratoriums also do not prevent GEMA from initiating, carrying out or continuing any legal process in relation to an energy company. Court permission is not required.

Whether we will see instances of energy companies utilising the Part A1 moratorium remains to be seen. However, with the ability of the Secretary of State and GEMA to seek special administration orders regardless, the moratorium may not be providing energy companies with the breathing space that was intended.

Australia’s Directors Continue to Enjoy Two Safe Harbours as the COVID-19 Insolvency Laws Are Extended

The Australian federal government has announced that the temporary changes it enacted in March to the Corporations Act concerning insolvent trading laws and the creditor’s statutory demand regime have been extended to 31 December 2020. The changes were due to expire on 25 September.

Please see out alert for further information.

Reflections on COVID-19 – Views From Germany

Image of human hand pointing at touchscreen in working environment at meetingIn a series of blogs, we will be reflecting on how the coronavirus disease 2019 (COVID-19) has affected local economies and businesses considering the impact of lockdown, how businesses have fared during the pandemic, whether support from the government has helped protect against business failure, which sectors have been hardest hit by the pandemic and which have prospered, as well as considering the impact of a second wave and what the future might hold.

In this first blog, we focus on the impact of COVID-19 on Germany.

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Resetting Your UK Business for the New Normal

Image of human hand pointing at touchscreen in working environment at meetingMany local, national and global businesses with UK operations have been significantly impacted by the coronavirus (COVID-19) pandemic. Cash flows have been impacted, trade and supply chains disrupted and business and consumer confidence damaged.

Many businesses are facing the same challenges at the same time. The key for businesses to resetting for the “new normal” is to consider the options now and take advice. Resetting may involve:

  • Re-evaluating supply chains and remodelling financial and business plans
  • Restructuring by making redundancies, closing unviable operations or selling loss-making divisions
  • Improving cash-flow through rescheduling current facilities, taking out new facilities, debt for equity swaps or other refinancing strategies
  • Agreeing informal or formal compromises with creditors

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Quick Guide to Directors’ Duties across Europe

Different countries frame the exact description of the role of directors of a company in different terms. One feature is common to all – the obligation not to continue trading if a company is insolvent. Again, the detailed implications of doing so vary from one jurisdiction to another.

We have produced a consolidated guide to give pointers to how directors should think about their duties.

To access the guide click  here

UPDATED Global Insolvency Report: Impact of Covid-19 on Insolvency Laws

Our guide sets out how different jurisdictions are changing their Insolvency Laws to help alleviate additional pressures placed on businesses as a consequence of cash flow pressures caused by COVID-19.

We have updated our guide to introduce a traffic light system to show the current status of these measures and to include further changes to insolvency laws in  Japan.

Click here to see our guide.