Relaxation in Insolvency Rules and Wrongful Trading
Relaxation in Insolvency Rules and Wrongful Trading
The government has relaxed insolvency rules for struggling companies.
The Government has relaxed insolvency rules to give bosses more breathing space when their businesses are hit by the pandemic.
Business Secretary Alok Sharma announced on Sunday that struggling companies would be able to access supplies and raw materials while restructuring their finances.
There would also be a temporary suspension of wrongful trading rules, applied retrospectively from March 1, meaning that company directors would not be personally liable for their decisions during the pandemic.
A suspension or amendment of the existing law will protect directors during the pandemic, allowing them to continue paying staff and suppliers despite concerns the company could become insolvent.