The Government wants to reduce the stigma associated with business failure, acknowledging that initial failure is often part of the innovative process.
As a result, the Government is to release a proposal paper, which is currently up for discussion with respect to the improvement of the insolvency laws to encourage innovation and which will include:
- Reducing the current default Bankruptcy period from three years to one year.
- Introducing a ‘safe harbour’ for Directors from personal liability for insolvent trading if they appoint a restructuring advisor to develop a turnaround plan for the company.
We will wait for further advice from the Government.
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