As the year draws to a close, the Government has recently announced that it will extend some temporary provisions in the Corporate Insolvency and Governance Act, as well as reinstate one that had already lapsed.
Extension of Temporary Suspension of Statutory Demands and Winding-Up Petitions
The Government announced on 9 December that it will extend the temporary suspension of statutory demands and winding-up petitions, with the suspension running until 31 March 2021. This was due to end on 31 December 2020.
Extension of Temporary Suspension of Wrongful Trading
The Government also announced on 9 on 25 November, its intention to reinstate the temporary suspension of wrongful trading until 30 April 2021.
The wrongful trading suspension ended on 30 September 2020, and the new temporary suspension is effective from 26 November in England, Wales & Scotland and from 14 December 2020 in Northern Ireland.
Please note that with the Regulations having a retrospective effect, there appears to be a gap of approximately two months where wrongful trading liability for directors was not suspended. As a result, it would appear that decisions and actions taken by directors in England, Wales & Scotland during the interim period between 30 September and 26 November would be subject to the ordinary wrongful trading provisions.
Strange times indeed….
Companies and other qualifying bodies that are obligated to hold AGMs will continue to be able to hold these meetings virtually until 31 March 2021. This dispensation was due to expire on 30 December 2020.