Corporate Insolvency Proceedings Update
The restrictions implemented in June 2020 as a result of the coronavirus pandemic (suspending the majority of winding up petitions in the UK) are finally coming to an end today. The government is replacing these blanket restrictions with some more limited ones, intended to protect smaller businesses in this recovery period. In summary, the new restrictions in place from tomorrow (1st October 2021) until 31stMarch 2022 are as follows:
- A creditor may not present a winding-up petition in respect of commercial rent that is unpaid because of a financial effect of coronavirus.
- A creditor may not present a winding-up petition if it is for a debt or debts totalling less than £10,000.
- A creditor may not present a winding-up petition unless written notice has been delivered to the debtor seeking the company’s proposals for payment of the debt and the company has not made a proposal that is to the creditor’s satisfaction within 21 days. A creditor may, however, apply to court for an order that they do not need to deliver a written notice or give the debtor 21 days to make a satisfactory proposal.
- A creditor will again be able to rely on non-payment of a statutory demand to evidence a debtor’s inability to pay their debts provided the other conditions are met.
If you have an outstanding debt you wish to resolve or recover, do not hesitate to contact our Dispute Resolution department for expert guidance on how best to proceed and protect your interests in this changing landscape.