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On 26 June 2020, the Corporate Insolvency and Governance Act 2020 (the “Act”) introduced the biggest reforms in a generation of U.K. insolvency law. It also implemented several temporary changes to both insolvency and company law to deal with solvency and governance pressures resulting from the coronavirus pandemic (“COVID-19”). These reforms were fast-tracked through the legislative process in the U.K., representing a clear move towards a more debtor-friendly, “rescue culture” for companies facing financial difficulty. In some respects they align U.K. insolvency law more closely with U.S. insolvency law, in particular Chapter 11 proceedings under the U.S. Bankruptcy Code. Our earlier briefing, COVID-19 Changes Announced to U.K. Insolvency Law and for AGMs, provided some background to these new reforms.
