COVID-19 Coronavirus: Restructuring

The UK Corporate Insolvency and Governance Act 2020 became law on 25 June 2020 and introduces temporary measures to help companies that are in financial distress because of COVID-19, including limiting when and how winding-up petitions may be used.

Read our guidance: Insolvency Alert: Corporate Insolvency and Governance Act 2020 Becomes Law (UK) - July 10, 2020

A UK High Court judge was persuaded, on the evidence, that there was a strong case that COVID-19 had a financial effect on the company before the presentation of a winding-up petition and, further, that the facts on which the petition would be based would not have arisen if COVID-19 had not had a financial effect on the company. This OnPoint discusses the implications of this case on any future insolvency matters in the UK.

Read our guidance: Insolvency Alert - England & Wales High Court Ruling on COVID-19 Protections in Corporate Insolvency and Governance Bill 2020 (UK) - June 8, 2020

The UK Government's Corporate Insolvency and Governance Bill will implement the most significant reform to the insolvency framework in decades. In addition to permanent landmark changes, including introducing a business rescue moratorium and new restructuring plan, the Bill contains a number of temporary measures to help businesses respond to the COVID-19 crisis. Whilst the timing for implementation is currently unclear, we anticipate that this new framework may be enacted as soon as June 2020.

Read our guidance: Corporate Insolvency and Governance Bill (UK) - June 4, 2020

This alert focuses on notable features of Dubai's DIFC Insolvency Law, while also looking at the recent temporary suspension of the wrongful trading rules introduced as a result of the COVID-19 pandemic.

Read our guidance: Revisiting the DIFC Insolvency Law in the Context of the COVID-19 Crisis: An Innovative Toolkit for the Turnaround of Troubled Enterprises (UAE) - April 30, 2020

The UAE overhauled its bankruptcy regime on December 29, 2016 with the introduction of the Bankruptcy Law. Until now, the Bankruptcy Law has only been anecdotally applied to a fairly small number of low profile insolvencies, but is now likely to be tested on a larger scale both in terms of numbers and size of debtors affected by insolvency proceedings. This alert is a refresher of some of the key features of the Bankruptcy Law and potential areas of concerns for debtors, their directors and their shareholders.

Read our guidance: The UAE Bankruptcy Law: Stepping up to the challenges raised by the COVID-19 crisis (UAE) - April 9, 2020

In response to the COVID-19 pandemic, the UK Government has announced the temporary suspension of wrongful trading rules retrospectively from 1 March 2020, for a period of three months. It has also indicated that it intends to fast track the implementation of significant reforms to the insolvency and restructuring regime.

Read our guidance: UK insolvency and restructuring update: COVID-19 support and major reform (UK) - April 3, 2020