28 May 2020
Generational Insolvency Reform restricts ipso facto provisions and pre-existing termination rights
The Corporate Insolvency and Governance Bill 2019-20, published during the COVID-19 pandemic, contains far-reaching reforms to the insolvency regime under the Insolvency Act 1986. We consider an area which will have a material impact on many commercial contracts: the introduction of restrictions on ipso facto clauses – provisions permitting a party to terminate a contract upon the counterparty suffering an insolvency event – in supply contracts, as well as wide-ranging restrictions on the ability of a supplier to exercise certain other rights after a company becomes subject to a relevant insolvency procedure.
This material is provided for general information only. It does not constitute legal or other professional advice.
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