The above measures are pragmatic steps to provide relief during this unprecedented period and will be strongly welcomed by the business community.
The suspension of the wrongful trading provisions at least during March, April and May 2020 (to be extended if necessary) should give directors the time and flexibility they need to assess the needs and future viability of their businesses without the threat of insolvency proceedings hanging over them. Further, directors will be able to make difficult decisions regarding company employees and suppliers without the risk of personal liability (subject to them acting in accordance with the director’s duties which remain in force).
The government have advised that they plan to bring forward legislation to bring into effect the new changes “at the earliest opportunity”, although the exact timing is uncertain at this stage. Parliament is currently in recess until 21 April 2020.
This article is for information purposes only and should not be relied upon in place of legal advice.