Following the expiry of the protections for debtors on 30 September 2021 under the Corporate Insolvency and Governance Act 2020, the government’s new amending regulations have come into force.
The Corporate Insolvency and Governance Act (Coronavirus) (Amendment of Schedule 10) Regulations 2021 aim to give smaller companies more time to trade before creditors can take action to wind them up.
The new temporary measures will apply for the period 1 October 2021 to 31 March 2022 and include:
• An increase in the debt threshold which must be owed by a company to a creditor before that creditor can present a winding up petition from £750 to £10,000.
• A requirement that, before presenting a winding up petition, creditors must seek proposals for payment from a debtor business, giving them 21 days for a response before they can proceed with winding up action.
• A creditor can apply to court for permission not to write to a company or to give a company less than 21 days to put forward repayment proposals.
• The winding up petition must contain a statement confirming that the regulations have been complied with.
The regulations also affect commercial landlords and prevent them from presenting a winding up petition in respect of “rent or any sum or other payment that a tenant is liable to pay” under a business tenancy and which is unpaid by reason of a financial effect of coronavirus until 31 March 2022.
If you are a creditor and require assistance with debt collection, please email lawyers@rooksrider.co.uk and a member of our Rooks Rider Solicitors’ Dispute Resolution team will be in touch.
