argyrotsipi/train-dataset huggingface dataset:
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Alok Kumar Sharma (Conservative, Centre-right): My hon. Friend the Under-Secretary of State will elaborate on some of the points that my hon. Friend raised. I would simply say that in July 2019, the Government issued a call for evidence on the insolvency regulatory framework, to determine whether any changes needed to be made. That included questions on whether there should be a single regulator. We expect to publish the Government response to the call for evidence later this year. Perhaps my hon. Friend the Under-Secretary will elaborate later Returning to the Bill, the package of measures has three elements. The first is a moratorium. That will give a company that is threatened with insolvency temporary respite from its creditors and a chance to arrange refinancing or a rescue. The moratorium will be for an initial period of 20 days, which can then be extended. There will be a time-limited easing of the eligibility criteria for a company to enter into a moratorium, to make it more accessible during the covid-19 response period.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Housing
Michael Jon Wood (Conservative, Centre-right): The temporary measures that my right hon. Friend has included in the Bill will provide great respite for many businesses, particularly in the hospitality sector, where businesses have been unable to trade throughout this outbreak but rents have remained very high; the measures will protect them from aggressive landlords. Those pressures will continue well past the end of June, so will he consider extending the protection for tenants from winding-up petitions?
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Alok Kumar Sharma (Conservative, Centre-right): Of course, that is part of the measures that we will bring in. I recognise why my hon. Friend wants to ensure that tenants have protection, and that is why we will introduce the temporary measures around this issue, but of course we also need to think about landlords. I will address that point as I go through my speech Returning to the moratorium, the time-limited easing of the eligibility criteria for a company to enter a moratorium, to make that more accessible during the covid-19 response period, will be in place for a month after Royal Assent. Of course, that can be extended if it is deemed necessary The second part of the new permanent restructuring measures will allow companies in financial difficulty to propose a rescue plan to restructure complex debt arrangements, and to bind creditors to it, as long as certain thresholds are met. That means that viable companies struggling with debt obligations will be able to restructure under the new procedure There are, however, significant safeguards and protections for creditors, which is right and proper. The plan must be sanctioned by the court and, indeed, any dissenting creditor class bound to a plan must not be made worse off than it would have been in the next most likely outcome. I know that a number of colleagues, both in the House and outside, have raised this issue. That is why we have ensured that this measure is in place The third part of the restructuring package will prohibit termination clauses. That will prevent suppliers from terminating contracts or raising prices just because a company has entered an insolvency procedure or a moratorium. Of course, we recognise that requiring companies to supply under those circumstances may cause them financial difficulties, so we have built in a number of protections for suppliers too If continuing supply would cause a supplier hardship, it can apply to the court for permission to terminate the contract. In addition, if goods or services supplied after the insolvency begins are not paid for, the supplier can terminate the contract. Further, the Government will temporarily exempt small suppliers from this requirement altogether during the covid-19 crisis, recognising the particular challenges that those firms face.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Mark Julian Francis Pawsey (Conservative, Centre-right): Small businesses often find themselves dictated to by larger organisations, and the last thing we want is for small businesses to be put at a disadvantage by being compelled to supply when they are not capable or it is not in their interest to do so. Will the Secretary State reassure us that small businesses in particular will be protected by these provisions?
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Alok Kumar Sharma (Conservative, Centre-right): My hon. Friend raises a really important point about protecting small suppliers. They will of course have this exemption. According to the definition in the Companies Act 2006, a small supplier is one that meets two of the following three criteria: having up to 50 employees, a turnover of up to £10.2 million, and gross assets of up to £5.1 million. I think that will cover a very large number of businesses in our country.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Richard Quentin Fuller (Conservative, Centre-right): May I thank you, Madam Deputy Speaker, for permitting so many interventions? As we are rushing through the Bill relatively quickly, it is important that Members on both sides of the House have the opportunity to raise points directly with the Secretary of State, so thank you for permitting some latitude for interventions. The small business commissioner appeared before the Business, Energy and Industrial Strategy Committee a few weeks ago, and I posed some questions about whether he had the powers he needed. As my right hon. Friend looks at this period, with the particular pressure caused by covid-19, is he assured that the small business commissioner’s powers are as will be needed, or does he envisage wanting to look again at this in the future?
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Alok Kumar Sharma (Conservative, Centre-right): My hon. Friend raises an incredibly important point. I championed this issue—support for small businesses—when I was on the Back Benches. As he will know, the Government’s payment terms are favourable in setting a very time-limited period within which payments must be made to Government suppliers, and of course the Government also require that if a large organisation is being paid by the Government under a contract, they need to pass on that speed of payment to smaller subcontractors. He will also know that in the manifesto on which he and I stood we committed to looking further at the role of the small business commissioner and how it might be strengthened. We will bring forward a consultation on that in due course I move now to the temporary measures in the Bill. The first set provides for a suspension of the serving of statutory demands and a restriction on winding-up petitions. These measures will be retrospective from 1 March and 27 April respectively and will last until one month after Royal Assent, although they can be extended if that is deemed necessary. The Coronavirus Act 2020 temporarily suspended the right of commercial landlords to forfeit the tenancies of retail businesses in order to protect tenants unable to trade because of covid-19. While this temporary suspension has been in place, the majority of landlords and tenants have been working well together to reach agreements on debt obligations, but a small number of landlords have been using aggressive debt recovery tactics to put pressure on tenants, including through the use of statutory demands and threats of winding up. For this reason, the measures in the Bill to limit the use of statutory demands and winding-up petitions have been welcomed by many, especially in the hospitality sector.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Housing
Alok Kumar Sharma (Conservative, Centre-right): It is intended to apply to all suppliers—I am sure I will be corrected if I am wrong on that. As my hon. Friend has also been keen to point out, although this measure is not restricted to commercial landlords, some landlords will have particular concerns, and I can reassure him that the Government will monitor the impact of the measure and are asking lenders and investors to consider how debt obligations can be met in a way that does not put unnecessary pressure on landlords.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Housing
Kevin Paul Hollinrake (Conservative, Centre-right): In respect of commercial loans, currently the banks, when showing forbearance, are providing capital repayment holidays but only on the capital element of the repayment. In respect of residential mortgages and loans, they are giving complete repayment holidays. The monthly capital repayment is a small element of the overall payment. The banks could be much more helpful to landlords by giving a complete holiday across the whole repayment for a period of time while showing forbearance to their tenants.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Alok Kumar Sharma (Conservative, Centre-right): Colleagues in the banking sector will I am sure be watching this debate and listening in, and they will have heard what my hon. Friend has said. I would be happy to have a discussion with him after this debate if there are particular points that he wants to raise or if he wants to talk about particular organisations The second temporary measure is the suspension of the wrongful trading provisions. This will be retrospective to 1 March and will be in place until one month after Royal Assent, and again it can be extended if that is deemed necessary. Hon. Members will know that wrongful trading is an important deterrent against company directors continuing to trade when the company is insolvent and when doing so increases the losses to creditors. Directors can be made personally liable as a result. However, during this difficult period, many otherwise viable companies may become technically insolvent, particularly if they have been severely affected by a drop in demand caused by covid-19. This measure gives company directors the confidence to use their best efforts to continue trading without the threat of personal liability, should the company ultimately go into insolvency. Since the measure was announced in March, we have received much support for it from stakeholders. The Institute of Directors has welcomed it, saying that it "will help to avert entirely preventable corporate collapses." The Bill also contains the necessary time-limited powers to extend these temporary provisions, should that prove necessary The Bill will also allow the Government to make other temporary amendments to insolvency law or the new restructuring plan to deal with the effects of covid-19, where needed. The power to amend corporate insolvency or governance legislation will allow the insolvency and business rescue regime to react quickly to the challenges we face as a result of the impact of covid-19, and that power will expire on 30 April 2021. However, due to the potential unforeseen circumstances relating to covid-19, the expiry date of this power can be extended if it is deemed necessary. If an extension is sought, the House will of course have an opportunity to scrutinise it The next group of temporary measures deals with meetings and company filings. These measures enable companies and other bodies, including mutual societies and charitable incorporated organisations, to hold AGMs and other meetings in a safe way, while respecting social distancing rules.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Alok Kumar Sharma (Conservative, Centre-right): There are, of course, other methods for shareholders to question directors of a company. There will be shareholders’ days, for example. The reality is that businesses will be reacting and doing their best to try to get information to their shareholders. I am sure that the hon. Lady’s point will be noted, but the intention of this Bill—and, I think, of the business community—is not in any way to use these measures to restrict shareholders’ access to information. This is actually about making sure that we can get past the pandemic and be in a position to bounce back The flexibility in terms of these meetings and filings will apply from 26 March—retrospectively, obviously—until 30 September. The measures also enable AGMs to be postponed until 30 September this year, where necessary.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Sara Alice Britcliffe (Conservative, Centre-right): I am encouraged that the measures for AGMs and other meetings are temporary. Does my right hon. Friend share my belief that in-person AGMs provide the best opportunities for shareholders to hold their directors to account?
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Alok Kumar Sharma (Conservative, Centre-right): My hon. Friend makes an important point. We would all like to get back to those face-to-face discussions, just as we are doing in the House today. These are temporary measures, and I hope that when we get through to the other side there will again be that opportunity for shareholders to meet and ask questions face to face, because that is right and appropriate.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Gareth Mark Davies (Conservative, Centre-right): Can my right hon. Friend confirm that the Government are not mandating how companies and organisations are to hold an AGM, but rather giving them flexibility at this incredibly difficult time as to how best to engage with shareholders?
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Alok Kumar Sharma (Conservative, Centre-right): My hon. Friend makes an incredibly important point. This is not about mandating; this is about giving choice. I expect that many companies will take up the temporary support that is being made available through these measures Expanding on the announcement I made on 25 March that companies would have an extended period for filing accounts, the Bill will also give businesses more time to meet a range of filing requirements. The extensions to the various filing requirements will be set out in regulations to be laid once the Bill receives Royal Assent. We will be giving businesses the maximum period allowable under the powers in the Bill for filing their accounts, confirmation statements and event-driven updates. We will also extend the period within which charges should be registered with Companies House to 31 days, which I believe strikes the right balance between providing businesses with breathing space and ensuring that lenders are protected In conclusion, the package of measures that the Bill introduces will give businesses the best opportunity to survive the effects of the covid-19 crisis and lay the foundations for a bounce-back in the UK economy. This Government are committed to supporting businesses. We are listening, and we are putting in place meaningful and common-sense measures to provide that support. Let me end by again paying tribute to the millions of business owners up and down our country who are doing their bit to keep Britain moving. In bringing these measures forward, we demonstrate again that we stand with them. I commend the Bill to the House.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Kevin Paul Hollinrake (Conservative, Centre-right): The right hon. Gentleman touched on his amendment that would ring-fence 30% of assets for unsecured creditors; is he not concerned that if we did that, people who are willing to extend finance to businesses on a secured basis may be less willing to lend?
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Abimbola Afolami (Conservative, Centre-right): Would the right hon. Gentleman support the ideas that I have been doing some work on—as have lots of people—outside this place in relation to recapitalising the British corporate sector, not just in terms of debt to equity, but in finding ways to get much more equity into our businesses so that they are not weighed down by debt? That approach could be how we recover from this situation.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Kevin Paul Hollinrake (Conservative, Centre-right): I agree with my hon. Friend and support his point. I think the provision to which he is referring is proposed new section A6(1)(e) in the Insolvency Act 1986, which contains the wording: "in the…monitor’s view, it is likely that a moratorium for the company would result in the rescue of the company as a going concern." Simply changing "would" to "could" would resolve the issues.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Kevin Paul Hollinrake (Conservative, Centre-right): That is a very important point. I think the legislation is covered under clause 95 of the Finance Bill, which makes HMRC a preferred creditor once again. The real concern is not just that lenders will be less willing to lend on that basis—that is a concern because you go above lenders with a floating charge—but that HMRC may be less willing to show forbearance to businesses that are seeking protection and time to get through these problems.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Kevin Paul Hollinrake (Conservative, Centre-right): I think it is a bit harsh to say that the schemes are not working at all. About £30 billion has been lent under both those schemes—about £9 billion under the CBILS and £21 billion under bounce-back loans. The CBILS issue seems to be that, although the forward-looking viability test has been removed, banks are still assessing whether businesses can afford to make the loan repayments over that period. If we remove the requirement for banks to do that, a lot more money would go out the door under the CBILS.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Mark Julian Francis Pawsey (Conservative, Centre-right): Does my hon. Friend agree that part of the problem is the 30-day, 60-day, 90-day culture that has arisen in trading between companies? It is much easier now for companies to get an earlier payment, because so many payments are by electronic transfer, and the notion that the cheque has to be there when the guy delivers the goods no longer applies. If this measure moves trading in that direction, does he agree that that would not necessarily be a bad thing?
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Richard Quentin Fuller (Conservative, Centre-right): It is a pleasure to serve on the Committee of which the hon. Member is Chair. I am interested to hear him talk about the differential impact on different sectors. He mentioned retail. Does he think that the Government’s policy to close retail was wrong?
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Richard Quentin Fuller (Conservative, Centre-right): My hon. Friend is making an important point. Does he share my concern that there is a certain vagueness about what continuing supply might mean for a business in crisis? Does it mean that the historic pattern of supply should be continued? Does it mean that a company that is potentially insolvent has the right to demand a much greater increase in supply? It is very unclear.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Mark Julian Francis Pawsey (Conservative, Centre-right): That is a good point, and I hope that the Minister will consider that, because in many cases a contract has been entered into on the basis of a certain volume of business. Many businesses have contracted, so a purchasing company may not be buying the same volume. Does that provide the ability to keep the price at the original position? Price and volume go hand in hand, and there may be additional economies of scale. There are concerns, and I know that the Minister will respond My hon. Friend the Member for Huntingdon (Mr Djanogly) raised the issue of debts accruing because of extended payment terms. Buyers are often more interested in payment terms than the price of the product. A buyer does a great job if he manages to screw 60 or 90-day payment terms out of a supplier, rather than a particularly good deal on the product. If we can move our culture away from extended credit many of the provisions in the Bill would be rather less necessary than they are. The Minister will deal with those issues, and it is entirely right that in the Bill he guarantees that supplies that are made during the moratorium are exempt—the supplier is guaranteed to be paid once the monitor has agreed that they will continue to trade. That goes some way towards providing substantial confidence to the supplier. I am also happy with the exemption from the provisions for small companies. As the Secretary of State has said at the Dispatch Box, the usual criteria on size apply I want to conclude with the temporary suspension of the rules on wrongful trading, which I entirely support. Right now, business directors around the country are pretty worried about the financial viability of their businesses and their liabilities if they continue to trade, particularly if the trade position continues to worsen. The current rules are that they could be liable personally if they do not bring their business to a conclusion, even though the challenges facing those businesses are not of their making. Relaxation of those wrongful trading provisions will enable many directors across the country to sleep rather more soundly at night.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Jerome Patrick Burke Mayhew (Conservative, Centre-right): Could I just come back on that interesting point about the risk of personal liability hanging over directors? I declare an interest, as I am a director of a trading business. It fits very well, does my hon. Friend not agree, with the development of the CBIL scheme? Originally, that scheme was not very popular, because many banks insisted on personal liability for businesses and for the directors of businesses to stand behind the loans that they were giving. The current scheme removes the risk of personal liability for directors via the scheme.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Mark Julian Francis Pawsey (Conservative, Centre-right): My hon. Friend makes a good point, and we must provide every support to business owners and directors at this challenging time, to allow them to make decisions that will enable their businesses to continue to survive.
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Kevin Paul Hollinrake (Conservative, Centre-right): My hon. Friend is making an important point. Is he aware that some banks have a blanket restriction on lending money to football clubs and are applying that restriction to CBILS as well, so even though the Government support is not supposed to have a sector-based restriction, this is being applied to football clubs?
Corporate Insolvency and Governance Bill — House of Commons, 2020-06-03
Topic: Domestic Commerce
Damian Noel Thomas Collins (Conservative, Centre-right): I am following my hon. Friend’s remarks closely. Given his opening remarks, might it not be better, if we believe in backing British business, for us to have some skin in the game? We might not get our money back every time, but overall we probably would.