Winding-up and forfeiture restrictions extended

Published 19 July 2021

The Government has extended the restrictions in place concerning winding-up petitions and forfeiture of business tenancies until 30 September 2021 and 25 March 2022 respectively.

The extensions will receive a mixed reception, with landlords likely to feel particularly aggrieved at the limitations imposed on their ability to pursue debt (by winding-up petition) in circumstances where the tenant can pay, but won’t pay.

Winding-up petitions remain capable of being issued but will be subject to the coronavirus test meaning that many petitions are unlikely to make it past the initial stage and creditors will be wary of proceeding with a petition unless they are confident that the coronavirus test can be overcome.

There were rumours that other restrictions, such as the suspension of liability for wrongful trading, would also be extended but no legislation has been introduced in this regard and that suspension therefore ended on 30 June 2021.