THERE IS AN INCREASING NUMBER OF CORPORATIONS IN INSOLVENCY DUE TO THE COVID-19 PANDEMIC. THE BRITISH GOVERNMENT INTRODUCED A RELEVANT NEW LEGISLATION IN 2020, NAMELY “CORPORATE INSOLVENCY AND GOVERNANCE ACT 2020” (CIGA ACT 2020). HEREBY, THE EXTENT TO WHICH THE CIGA 2020-INDUCED CHANGES WOULD FACILITATE THE SURVIVAL OF CORPORATIONS POST-COVID-19 IS ADDRESSED

Abstract

Abstract: The UK enacted new legislation, CIGA 2020, which introduced temporary and permanent measures to assist corporations in the country through coronavirus lockdown’s financial difficulties and effects. This secondary research uses a comparative methodology to compare and contrast the UK and US systems of Restructuring Plan (cross-class cram down feature), wrongful trading and fraudulent conveyance. There is also the use of doctrinal methodology to help in analysing relevant legislation and case law. Accordingly, the methodologies assist in exploring the importance of CIGA 2020 in supporting business survival after the coronavirus pandemic. The study finds that the UK and US systems are comparable and have several similarities and differences. In addition, the research progresses with the argument that while CIGA 2020 introduced relevant changes to insolvency law in the UK, some issues could arise, for instance, with cross-class cram down, and the major issue is valuation disputes. Similarly, the study identifies some shortcomings with the suspension of wrongful trading rules, thus, the recommendations of the study target the same. The project finalises by providing suggestions for future study, which is related to the current research topic.