The government has introduced a new law project to solve companies’ governance and insolvency problems in Parliament.
Indeed, more than half a million of British companies are on the way to reach a critical financial situation because of the coronavirus.
So, the country decides to fight against the phenomenom by proposing radical measures to deal with it in this new law statement.
Based on an American model, the moratorium is designed to give to companies a period of 20 days to explore restructuring options before any legal decision of the justice, in case of a lawsuit.
During this period, the company will remain under the control of its direction; However, the process will be supervised by a certified insolvency expert who will have to assist the company during the entire duration of the moratorium.
The process may also be extended to 40 working days if the creditors or the court find an agreement on it.
In March, rules penalizing companies that were no longer able to pay creditors were relaxed.
Indeed, companies involved in a justice case for insolvency will not see the losses that they get between March 1 and June 30 (for all types of transactions) take into account by the justice court.
Organizations can request a default delays of three months for bank accounts and confirmation statements to the justice court, without getting any penalties.
These new rules are also used for events deposits.
Annual general meetings
Since March 26, companies which have manage general meetings, have adhered to social distancing measures and have not respected their statutes; will be conformed to the law.
Companies forced to postpone their annual general meetings after March 26 will also be authorized to suspend them until the end of September.
For the following
All these tools were created to save businesses threatened by a bankruptcy situation.
Will they be enough to save half a million of British businesses?
Is there other efficient measures ?