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Financial distress and your safety net during COVID-19

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At our Wednesdays With Redchip webinar in August, the Litigation team explored the temporary changes to insolvency laws and the safety net offered to businesses during COVID-19.

 

See below the presentation slides from the webinar or download them here.


 

Temporary changes to insolvency laws mean businesses have a safety net so they can resume normal operations once the crisis has passed. This includes an increase to the statutory demand limit (to $20,000), and extended protections for directors against personal liability for trading whilst insolvent.

This safety net, however, is due to expire on 24 September 2020 and businesses can then expect sudden and aggressive debt recovery measures from creditors including the ATO.

Redchip’s insolvency experts Robert Champney and Rebecca Forsyth covered:

  • Changes to occur from 25 September – statutory demands, bankruptcy notices, and obligations as a director;
  • Debt recovery options available to your clients to improve cash flow; and
  • “Red flags” that determine financial distress, what options are available to restructure, and the need for proactive conversations with your client and legal advisors.

Please get in touch with our team if you have any follow up questions on the content provided.

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