Directors to get insolvent trading relief, but debt recovery toughened, under temporary COVID-19 measures (Clayton Utz)

Author, Cameron Belyea (Partner, Clayton Utz) TMA Australia Chair

Directors will soon be free to make decisions to trade on even insolvent entities, and incur debts in the ordinary course of business, with the passing of the Coronavirus Economic Response Package Omnibus Act 2020 last night and Royal Assent today. The Act is intended to encourage business to continue trading free of risk that insolvent trading laws – which prevent directors of insolvent companies incurring fresh debt – would impose a personal civil and criminal liability on them. There are also changes to statutory demands and debtor’s petitions. More