The government announced on Saturday 28 March a relaxation of the Insolvency Rules to assist struggling business during the coronavirus.
Such measures will include changes to assist companies undergoing rescue or restructure to continue trading giving them help to try and avoid insolvency; these changes will enable companies to continue buying supplies such as utilities and raw materials while attempting a rescue and there will be a temporary suspension of the wrongful trading provisions (so where directors should not normally continue to incur debt when they know or ought to know that the company is insolvent and incurring personal liability if they do so). This suspension of the wrongful trading provisions will have retrospective effect from the 1 March 2020 and will run for 3 months to provide company directors with some breathing space to allow them to keep trading without the threat of this personal liability.
It is hoped that this will provide businesses with much needed help to keep going during these unprecedented difficult times.
Should you require legal insolvency advice for your business or for you personally please contact Leanne Schneider-Rose on 0121 698 2200 or email l.schneider-rose@sydneymitchell.co.uk
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