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COVID-19 Update: Corporate Insolvency and Government Act 2020

On 9th December 2020, the Government announced its latest plans to extend the operation of various Coronavirus (COVID19) related measures, originally introduced at the beginning of the pandemic, under the Corporate Insolvency and Government Act 2020.

The measures due to be extended include restrictions on statutory demands and winding-up petitions. At the time of writing, the relevant statutory instrument is yet to be made but the government has confirmed it intends these measures will now be in force until 30th March 2021.

This means that statuary demands served between 1st March 2020 and 31st March 2021 cannot be relied upon regardless of whether coronavirus actually had an impact on the financial position on the debtor company.

In addition, creditors may not present a winding-up petition, without ‘reasonable grounds for believing’ that the debtor company would have become insolvent regardless of Coronavirus.

The government has also announced that companies and other qualifying bodies will continue to benefit from the temporarily relaxed obligations concerning AGMs. Up to 31st March 2021 companies can continue to hold meeting virtually and shareholders can legitimately cast their votes remotely.

For more information or advice on this or any other insolvency-related issue, you can contact Head of Insolvency and qualified Insolvency Practitioner, Annabel Whittaker on 0115 9 100 256 or send her an email.

Posted on December 21, 2020

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