TSMP Law Corporation litigation director Felicia Tan commented in a Business Times article published in the 15-16 August 2020 edition on the new Insolvency, Restructuring and Dissolution Act (IRDA), which came into force two weeks ago.
She said: “There is a steady and continuous focus towards better facilitation of debt restructuring while discouraging a rush to wind the company up.”
She also said that the restriction of ipso facto clauses is the most impactful revolution. Suppliers or counter-parties are prevented from exercising this clause and terminating contracts on the sole basis that a debtor has initiated a restructuring procedure. This gives viable companies a reprieve and a chance at maintaining their businesses.
She added that the wider net for wrongful trading is is obviously a space worth watching once the prescribed period for temporary relief from wrongful trading provided under the Covid-19 Act expires in October.
The story can be found here: https://www.businesstimes.com.sg/brunch/saved-by-the-bell-how-singapores-new-insolvency-laws-could-extend-lifelines-for-distressed