Directors stay in control under Covid Insolvency Laws. The 20 day Moratorium process under the 2020 Corporate Insolvency and Governance Act, CIGA 2020, protects the company from new legal recovery actions by creditors. It can easily be extended for an extra 20 days. It leaves the board in control, subject to an independent Monitor. Previously such protection required passing control to an administrator or liquidator.
CIGA 2020 also introduced a temporary relaxation, until 30 September, of Wrongful Trading and of actions made difficult by covid-19, such as document filing deadlines and shareholder meetings. CIGA 2020 was later extended to 31 December 2020, except for the temporary relaxation of Wrongful Trading rules.
The key change here is that Directors stay in control under Covid Insolvency Laws.
Our course covers this and other key topics in more detail
For more information please click the link to visit the Professional Directors Association
This change to allow Directors stay in control of their companies whilst being protected from their creditors brings the legal situation in the UK more closely in alignment with USA legislation.