The last few months have significantly affected all businesses owners, not just their business but their personal life, well being and family. It has been a domino effect. So many blocks have come stumbling down!
The Government has eased the restrictions on businesses and the country has started to return to work. Directors are feeling the pressure and the effects on their companies, redirecting cash flow after such a lengthy lockdown will be tricky.
We have been advising numerous directors who feel they are drowning under paperwork and pressure from creditors with no clear plan or strategy.
The introduction of the Corporate Insolvency and Governance Bill, which is targeted at helping companies survive, protecting jobs and supporting the UK economy. There are so many ways to protect your business from closing down.
Some of the measures which are going to be introduced will only apply for an initial temporary period. The UK parliament will retain the power to extend these periods, if necessary. The introduction to the new legislation will involve:-
- Company Moratoriums – Insolvent companies or companies which are likely to become insolvent can obtain a 20 business day moratorium period which will allow viable businesses time to restructure or seek new investment, free from creditor legal action.
- Statutory Demands and Petitions – Temporary provisions to restrict statutory demands and winding up petitions issued against companies during the pandemic where the debt is unpaid for reasons relating to COVID-19.
- Suspension of Wrongful Trading – The Bill will temporarily suspend such wrongful trading provisions for a period of four months with retrospective effect from 1 March 2020 to 30 June 2020.
The new legislation is quite complex and so it is vital that the directors take advice as soon as practical to avoid any allegation of wrong doing.
The sooner you take advice, the more likely that there will be time to plan a way forward and deal with mitigating circumstances.
Next Steps
If you want to find out anything further about this topic then please feel free to call on 0330 236 9930, 0330 236 9938 or 07961 116321. All conversations will be in strict confidence. You can also email vee@navigatebr.com.
This article is for information and interest only. It is not a substitute for full professional advice, which will take in to account the specific and individual circumstances. Navigate Business Recovery Limited cannot accept any responsibility for any loss arising as a result of any person or organisation acting or refraining from acting on any information.
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