Insolvency Act receives Royal Assent
The Insolvency Act last week received Royal Assent giving assistance to viable small businesses that fall in to difficulty.
The Act allows companies in trouble, breathing space, with which they can prepare a Company Voluntary Arrangement, a rescue plan, to put to creditors.
The government also hopes the Act will improve the efficiency of the procedure for the disqualification of unfit company directors.
Competition and consumer affairs minister, Dr Kim Howells, said: ‘The new provision in the CVA procedure will help give more time to businesses experiencing short-term problems to agree a rescue proposal with their creditors.
‘This will stop creditors taking legal action against the assets of the company before it has had the chance to agree a solution to the problem with them.’
Implementation of the Act will take place next year, when the necessary secondary legislation is ready.