Disclaimer: This publication contains comments of a general nature only, and is provided as an information service.
It is not intended to be relied upon as, nor is it a substitute for specific professional advice.
The Federal Government has announced that it will continue to provide regulatory relief for businesses that have been impacted by the Coronavirus crisis by extending temporary insolvency, and bankruptcy protections until 31 December 2020.
Regulations will be made to extend the following temporary regulatory measures:
- The temporary increase in the threshold at which creditors can issue a statutory demand on a company;
- The temporary extension to the time companies have to respond to statutory demands they receive; and
- The temporary relief for directors from any personal liability for trading while insolvent.
The Government is also providing over $314 billion in additional financial support for workers, households, and businesses to support them during the Coronavirus crisis.
The Government anticipates that the extension of the temporary measures, and the unprecedent amount of financial support, will prevent a further wave of businesses going into insolvency or external administration before they have had the opportunity to recover.
Businesses who have not become insolvent or gone into administration, should take advantage of the extensions of the temporary measures to examine their current operations, restructure and wind down if necessary, and position themselves to take advantage of the new economic environment that will emerge from the wake of the current Coronavirus crisis.