Late last month, the Government extended measures put in place to protect businesses from insolvency — the Corporate Insolvency and Governance Act, which was due to expire on 30 September 2020 — thereby giving businesses ‘much-needed breathing space’ during the Covid-19 pandemic.

The new temporary measures include: companies and other qualifying bodies with obligations to hold AGMs continuing to have the flexibility to hold these meetings virtually until 30 December 2020; statutory demands and winding-up petitions now continuing to be restricted until 31 December 2020, to protect companies from ‘aggressive creditor enforcement action’ as a result of Coronavirus-related debts; and ensuring that termination clauses are still prohibited, thereby stopping suppliers from ceasing their supply or asking for additional payments while a company is going through a rescue process (small suppliers will remain exempted from the obligation to supply until 30 March 2021 so that they can to protect their business if necessary).

Furthermore, the modifications to the new ‘moratorium procedure’, which relaxes the entry requirements to it, will be extended until 30 March 2021 (a company may enter into a moratorium if it has been subject to an insolvency procedure in the previous 12 months).

Measures will also ease access for companies subject to a winding up petition (the temporary moratorium rules will also be extended to 30 March 2021).

Business Minister Lord Callanan (pictured) said: “It is vital that we continue to deliver certainty to businesses through this challenging time, which is why we are now extending these important — and necessary — measures, to protect companies from insolvency and ensure that businesses are able to not only come through this testing period but also plan, adapt and ‘build back better’.”