Insolvency rules shake-up announced

Commercial business loans

Business Secretary Alok Sharma has revealed that changes will be made to insolvency rules to allow firms greater flexibility as they faced the coronavirus crisis. The new rules will allow companies undergoing restructuring to continue to get access to supplies and raw materials.

Mr Sharma also said there will be a temporary suspension of “wrongful trading” rules for company directors to remove the threat of personal liability during the pandemic, which will apply retrospectively from March 1. Although business groups welcomed the move, R3, the trade association for the UK’s insolvency industry, believes the rule change could be open to abuse.

Mr Sharma also announced that red tape will be scrapped to allow new producers of hand sanitiser to bring products to market “in a matter of days.”

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