On 25 June, the Corporate Insolvency and Governance Act (the "Act") received Royal Assent to introduce reforms to the existing insolvency and companies legislation. The Act has been fast tracked through Parliament, taking just over a month from start to finish. Many of the provisions take effect from today. Certain of the Act's temporary provisions have now been extended until the end of September 2020, and will have retrospective effect.
The Act introduces both temporary emergency measures and permanent measures. These measures have business rescue at their heart, and, together with government financial support, are aimed at limiting formal insolvencies and allowing business to 'bounce back' from the adverse financial circumstances caused by the Covid-19 pandemic. The Act provides distressed businesses and their directors with some welcome relief during these unprecedented times and provides further restructuring tools, with the aim of preserving jobs and restoring the economic and productive capacity of the nation. Given the wide market ramifications of the Act, we reached out to our network of Partners for their thoughts on how the changes will be played out in practice and affect different stakeholders.