Government measures in key jurisdictions 5th edition - Flipbook - Page 64
Ireland
Insolvency
•
Lay-Offs and Short Time: The Government suspension of redundancy provisions in relation to
temporary lay-offs and short time during the Covid-19 emergency period has been extended until
31 March 2021. This suspension means that an employee who has been laid off or kept on shorttime due to the effects of measures required to be taken by his or her employer in order to comply
with government policy to prevent, limit, minimise or slow the spread of infection of Covid-19
cannot give notice of his intention to claim redundancy during that period.
•
Enhanced Illness Benefit: Employees or unemployed people who receive medical certification
that they are unable to work due to a diagnosis of Covid-19, or that they have been instructed to
self-isolate, may avail of an enhanced illness benefit of Ä350 per week. Further information in
relation to this benefit can be found here.
The Companies (Miscellaneous Provisions) (Covid-19) Act 2020, which came into effect on 21
August 2020, has implemented the following changes in the area of insolvency during the
“interim period” (which is currently until 9 June 2021):
Has the
government made any
changes to insolvency •
legislation?
(i) Insolvency: A company will be deemed to be unable to pay its debts during the interim
period, if it fails after 21 days’ notice to pay a debt of Ä50,000. (In the ordinary course of
events, a single debt of Ä10,000, or aggregate debts of Ä20,000 would be sufficient).
•
(ii) Examinership: The duration of the examinership process has been extended by an
additional 50 days during the interim period if the examiner has been unable to make his
report within the usual 100 days and if “exceptional circumstances exist in respect of the
company”.
•
(iii) Meetings of Creditors: much like virtual board meetings, the liquidator of an
insolvent company is given discretion to conduct a meeting of creditors at a physical
venue or wholly or in part as an electronic meeting, provided that all attendees have the
ability to participate in the meeting. The Act sets down specific information that must be
provided to shareholders in the notice of the meeting.
There have also been some changes to legislation in other areas such as, for example,
landlord / tenant or employment law that will impact on insolvency practitioners,
particularly receivers and liquidators, during this emergency period.
Contractual
Issues
What measures
have been taken
to reinforce
contracts?
There has been no recent legislative intervention in respect of the reinforcement of
contracts and the usual contractual rules apply.
Due to the disruption caused by the Covid-19 outbreak and the extensive Government
restrictions, many businesses, as a precautionary measure, may wish to review their
current contracts in order to determine whether they are protected or can avail of some
form of relief, in case they are unable to perform their obligations. Such relief may take
the form of a force majeure clause within a contract or relying on the doctrine of
frustration if the circumstances permit.
Force majeure clauses are interpreted strictly by the Irish courts, so businesses should
evaluate the contents of their clauses in key contracts with their legal advisor in order to
ascertain whether they cover the current Covid-19 crisis.
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Government measures in key jurisdictions
