This briefing considers what the new rules and what opportunities they will give to struggling companies.

Wrongful trading

The ability to hold directors personally liable for the additional net shortfall to creditors incurred during a period of wrongful trading, pursuant to section 214 of the Insolvency Act 1986, will simply be suspended (retrospectively) from 1 March 2020 until such date as the government determines.

Presumably this will have to continue for longer than the immediate pandemic to allow those companies who became of a doubtful solvency position during the pandemic to rescue.

New moratorium and restructuring