COVID-19 Resources

The rapid global spread of the COVID-19 virus is presenting unprecedented challenges to businesses, governments and communities across the world.

Our primary focus at this time is to ensure the health and welfare of our staff and offer the full support to our clients and their businesses on challenges and complex legal issues arising during these uncertain times.

Read the message from our leadership team

The UK Government has announced an unprecedented stimulus package to help support businesses in the wake of the COVID-19 outbreak. These measures, originally announced by the Chancellor of the Exchequer in his budget on 11 March 2020, have rapidly expanded in the past days and weeks. The scenario is subject to constant (and rapid) change and the measures appear to have unlimited scope with both the UK Government and Bank of England encouraging businesses to open up a dialogue with them before making any long-term negative decisions. 

We have produced a summary of the key measures to help businesses which were announced by the UK Government as part of its response to the COVID-19 outbreak.

Read our briefing in full - COVID-19: new UK Government assistance available to businesses

Consumer-facing businesses responsible for holding large-scale public gatherings (such as concerts, performances or conferences) are not only facing the prospect of customers pulling out, but that they themselves may have to cancel such events.

Here, we look at similar issues for consumer facing businesses which are forced to cancel events, where consumer protection legislation adds an extra layer of complexity (as compared with business to business contracts).

• What are force majeure clauses? - Ordinarily, breach by a party of its obligations under a contract resulting from non performance or delayed performance, would result in that party being liable to pay the other party the losses that they suffer as a result of the breach. However, if the party's non performance or delay in performance was caused by an event which was outside their control, and where that circumstance is addressed by a force majeure clause in the contract (which typically includes a list of such events), then the party relying on the clause may be able to side step the liability that would ordinarily have arisen as a result of their breach.
• When does the Consumer Rights Act 2015 apply? - The CRA applies to all contracts between traders and consumers for goods, services or digital content. Even where you have chosen a governing law other than English law for your terms and conditions, if you pursue or direct your activities to the UK and the consumer is habitually resident in the UK, the CRA will still apply.
• What if the customer tries to cancel? - Again, much will depend on what your terms and conditions say, whether the relevant clauses are fair, and the circumstances in which they wish to terminate. If your terms provide your customers with generous rights to cancel, exchange or reschedule, then assuming they have been properly incorporated, you will need to adhere to these.
• More complex situations - The situation becomes more complicated where a customer cancels because a) they have COVID-19 and they are self isolating; or b) they will not be able to travel to the event, because public transport is not working (whether that’s because there aren't enough well people to operate the transport system, or the government has put limits on public transport). There is no clear answer here. Much will depend on how balanced your terms and conditions are generally (eg cancellation rights are provided equally for both sides),  precisely why the customer is cancelling, and the wider circumstances.

 

This is an extract from our Cancelling an event due to COVID-19 briefing.

Read the full Cancelling an event due to COVID-19 briefing here

Read our full Coronavirus – issues for business briefing here

Companies with an international footprint will need to ensure that their tax residence (and other taxable presence) is not affected by travel restrictions imposed in response to the COVID-19 pandemic. HMRC has published guidance on these issues, which is somewhat helpful if less definitive than the approach of a number of other jurisdictions. Careful thought will be needed where senior executives/management are unable to travel, and so are required to carry on their role or participate in key management or commercial decision-making in a different jurisdiction from usual. Similarly, businesses should avoid establishing or expanding a fixed place of business, as this could create a permanent establishment ("PE") for tax purposes or increase the allocation of profits to such a PE. Included at the end of this article are some practical steps that businesses might wish to take to mitigate these risks.

One of the many issues which businesses with a cross-border footprint will need to consider as a result of the measures taken to contain the global spread of coronavirus (COVID-19) is the maintenance of corporate tax residency, and more generally controlling the location of their taxable presence.

HMRC has now updated its International Manual to set out its approach to corporate tax residence and to permanent establishments in light of the disruption to business caused by the current COVID-19 pandemic. The guidance can be found here. Although HMRC is "very sympathetic" to the disruption to international travel and business operations caused by the pandemic, it has not followed the approach of a number of other jurisdictions by giving definitive comfort on the impact of the pandemic, as it considers that existing legislation and guidance provides sufficient flexibility to deal with the change in business practices necessitated by the response to COVID-19.

In addition, the OECD Secretariat has published its analysis (which can be found here) of the impact of COVID-19 on the international tax treaty rules. Its conclusions are discussed below.

The discussion in this briefing focuses primarily on the UK position. It is important to be conscious that similar issues could arise in other jurisdictions – for example, UK companies should manage their risk of becoming resident in other jurisdictions or establishing a new PE in other jurisdictions by reason of key employees or directors being located there. These issues should be looked at by businesses in the round.

For further information, read our Corporate tax residence, taxable presence and COVID-19 briefing. 

read Corporate tax residence, taxable presence and COVID-19 in full

In addition to the Bank of England's cut of base rate to 0.25% on Budget day, the Budget included a £12bn package of "temporary, targeted and timely" measures to help the country weather the global outbreak of COVID-19. This includes boosting NHS funding (to the tune of at least £5bn), extending sick pay and suspending business rates for many firms.  The Chancellor said that:

"Whatever the NHS needs to cope with coronavirus…it will get" whether its "millions or billions".  "For a period, it's going to be tough" but this will be "temporary" and "life will return to normal".

As the COVID-19 situation developed, the Chancellor subsequently announced a number of additional measures, on top of those announced in the Budget, to support businesses and individuals through the economic crisis caused by the virus.  The amount of additional funding provided is unprecedented.  The cost of the additional measures is estimated by the Treasury to be more than £20bn, with a further £330bn of guarantees being offered by the government – equivalent to 15% of UK GDP. On 20 March, the government announced a job retention scheme to protect jobs by providing assistance to employers in paying their employees.

The Chancellor has reiterated that the government will do "whatever it takes" to support individuals and businesses through the crisis and noted that the measures below are only the first steps, with more to follow in the coming days. Further details on the measures that have already been announced are expected in the coming days and weeks, which should provide information on how these measures will operate and (where relevant) can be claimed by businesses.

Key specific measures:

Support for individuals

• Statutory sick pay (SSP) will be available to anyone who is advised to self-isolate even if they do not have any symptoms

• A £500m "hardship fund" will be given to local authorities in England to help vulnerable people

• Those on zero hours contracts, in the gig economy and self-employed will be able to access benefits more quickly

• There will be no requirement to physically attend a Job Centre for individuals claiming benefits who have been advised to stay at home

• An agreement with mortgage lenders to grant payment holidays of up to 3 months to those experiencing financial difficulties due to COVID-19

• The next instalment of income tax payable by individuals who are self-employed (previously 31 July 2020) has been deferred to 31 January 2021

 

Support for businesses

• Contribution of 80% of employees' salary (up to a cap of £2,500 per month) by the government where employers make employees "furloughed workers" rather than making those employees redundant. The scheme will cover salary costs from 1 March 2020 for a 3 month initial period, and there are no limits applied to the funding available or to the operating sector or size of the employer
  
  
• The cost of SSP for those off work due to the coronavirus will be met by the government for businesses with fewer than 250 employees
  
  
• Deferral of the next quarter of VAT payments for all businesses until the end of June 2020 and an extension of the time that businesses have to pay that VAT until 31 December 2020
  
  
• Business rates will be suspended for a year for all retail, hospitality and leisure businesses
  
  
• Grants of £10,000 will be available to small businesses eligible for Small Business Rate Relief and £25,000 grants will be available to all retail, hospitality and leisure businesses operating from smaller premises, with a rateable value of £15,000 - £51,000
  
  
• A temporary "coronavirus business interruption loan scheme" will be established for banks to support small and medium-sized businesses with loans of up to £5m, with the first 12 months of that finance interest free for businesses as the government will cover the first 12 months of interest payments
  
  
• The Bank of England has also introduced further measures, being (i) a new Term Funding Scheme with additional incentives for SMEs financed by the issuance of central bank reserves, and (ii) the immediate reduction in the UK countercyclical capital buffer rate from 1% to 0% 
  
  
• In addition to the lending support for smaller businesses, the government will now provide support for liquidity amongst large businesses through unlimited loans and guarantees to bridge cash flow disruption to be offered by the Bank of England under a COVID-19 Corporate Financing Facility.  The Chancellor has also made available £330bn of guarantees for businesses to enable them to secure third party financing.
  
  

Click here for HM Treasury's COVID-19 updates

HMRC have introduced temporary procedures for the payment of stamp duty on, and the stamping of, stock transfer forms and other instruments of transfer. Under the usual procedure, stock transfer forms are physically stamped using a specialised machine located at one of HMRC's offices. However, due to the government's social distancing guidance, these HMRC offices are now closed, which means stock transfer forms cannot be submitted for physical stamping. HMRC have introduced temporary procedures to allow for the stamp duty process to be completed online via email. These temporary procedures apply to stamp duty, and not to stamp duty reserve tax or stamp duty land tax. 

For a summary of the temporary procedures introduced by HMRC, please read our Stamp duty: Temporary COVID-19 procedures briefing. 

read Stamp duty: Temporary COVID-19 procedures in full

The purpose of this note is to focus on issues that could particularly affect portfolio companies of private equity and other financial investors. We have a depth of experience in advising portfolio companies and PE houses at unpredictable times, including throughout the global financial crisis and the uncertainty arising from Brexit. Our team is working as usual during the current uncertainty and so please do feel free to pick up with your usual Travers Smith contacts or any of our team to discuss any issues.

This briefing covers:

• COVID-19 resources
• Insolvency considerations
• Debt financing 
• Employment issues 
• Supply chain issues
  
  

For further detail see our COVID-19: considerations for portfolio companies briefing. 

Read COVID-19: considerations for portfolio companies in full

On 20 April 2020, the Government announced a new scheme to issue convertible loans to innovative companies which are facing financial difficulties due to COVID-19, provided that funding is matched by at least an equivalent amount of funding from private investors (the "Future Fund Scheme").

The scheme will commence in May 2020 and will continue until 30 September 2020. The Government will initially make £500m available for the Future Fund Scheme, which will be delivered in partnership with the British Business Bank. This note summarises what has been announced so far, and the potential issues that could arise for businesses seeking to take advantage of the Future Fund Scheme. Further details and guidance are expected to be published in due course. View the headline terms published so far here.

For further information, read our Proposed future fund loans to mitigate the effects of COVID-19 on innovative companies briefing. 

read Proposed future fund loans to mitigate the effects of COVID-19 on innovative companies in full

The increase in the spread of coronavirus (Covid-19), both in the UK and globally, presents a number of challenges for employers. Below we highlight some of the key employment law issues raised by the outbreak.

• Self-isolation and pay: Employers are grappling with issues around pay and sick pay in relation to staff who are self-isolating in accordance with government guidelines. Such staff are now entitled to statutory sick pay if they are unable to work and employers are encouraged to apply any enhanced company sick pay as well. Employees who are able to work remotely while self-isolating are of course entitled to their normal full pay.
• Staff safety and wellbeing: Many employers have put in place measures to ensure the health and safety for those in key service roles who are continuing to work during the pandemic, including additional workplace cleaning, personal hygiene reminders, considering commuting arrangements and compulsory self-isolation for employees who are at risk, may have symptoms or come into contact others who pose risk. With homeworking also now commonplace, employers must consider how to support and ensure the wellbeing of staff working remotely. Many employers are putting in place measures to combat issues associated with homeworking, such as feelings of isolation and loneliness.

• Protecting personal data: Protecting staff presents a range of data protection issues for employers, particularly in relation to sharing information on staff who have been diagnosed with Covid-19, have symptoms or who otherwise present a risk (see our note on protecting personal data for a more detailed discussion of these issues).

• Job retention: Amid the significant economic downturn, many businesses are having to consider ways of reducing costs to avoid redundancies. The government has announced the Coronavirus Job Retention Scheme which will provide funding for 80% of wage costs (capped at £2,500 per month) for up to three months for employees who are retained but who are not working due to Covid-19. This will be welcomed by employers but there remain a number of employment law issues to consider such as how to agree and document the arrangements with staff, and how to select which employees to stand down if others will continue to work or possibly face redundancies. For some employers, other cost cutting measures may still be required such as unpaid leave or sabbaticals, agreeing pay cuts, reducing hours and overtime, or requiring staff to take holiday.

• Redundancy consultation: For some employers, redundancies will remain unavoidable in the current climate. Employers must be mindful of their consultation obligations, which are only relaxed in the most extreme cases. Generally, employers must consult trade union or elected employee representatives where 20+ dismissals are proposed at an establishment within a 90-day period, and consultation must last at least 30 days (for 20+ dismissals) or 45 days (for 100+ dismissals). Even where less than 20 dismissals are proposed, employers must consult with the individuals affected. These consultation obligations present a particular challenge for some with such a rapid and sharp decline in business caused by the COVID-19 outbreak.
• Time off for carers and volunteers: With the national closure of schools and childcare facilities, many employees are having to balance childcare and work. Employees have the right to reasonable unpaid time off to deal with disruptions in care arrangements and employers are having to consider how this interacts with homeworking arrangements. The government's Coronavirus Bill also creates a new right to emergency volunteer leave for workers volunteering with certain listed public authorities. Employees and workers will be able to take unpaid emergency volunteer leave in blocks of two, three or four weeks, with a UK-wide compensation fund to be established to compensate for loss of earnings and expenses.

With the EU's external borders now closed to non "essential" travel for 30 days, more and more countries are implementing or extending travel restrictions in a bid to reduce the spread of the COVID-19 outbreak. These restrictions and the outbreak itself are having a flow-on effect on immigration considerations for employers, including in relation to right to work checks, visa applications and sponsor compliance.

As the situation continues to develop, we have been working with clients to navigate some of these immigration issues, including:

• Right to work checks for new starters
• Sponsor compliance
• Visa applications from outside the UK
• Visa extensions
  
  

For further detail, see our COVID-19: immigration implications briefing. 

Read COVID-19: immigration implications in full

Businesses face an unprecedented set of challenges in dealing with the onslaught of the Coronavirus COVID-19 ("COVID-19"). We set out below some key considerations under the GDPR for businesses that process personal data.

GDPR compliance obligations continue, despite the extreme challenges facing businesses across the board. In deciding the appropriate measures to take in such circumstances, these core data protection principles should always form your starting point in decision making, and provide you with a route map towards compliance.

Key points:

1. Transparency: be transparent to employees and third parties (such as visitors) about your data processing activities, for example about how and why you collect their personal data and to whom may you transfer it.
   
   
2. Proportionality: if an action would be considered excessive by the public, it is likely to be.
   
   
3. Data retention: retain data for the minimum time necessary (and keep it secure whilst you hold it).
   
   
4. Data minimisation: only collect data which is essential for the relevant purpose.
   
   

This is an extract from our COVID-19: protecting personal data while protecting your employees briefing.

Read COVID-19: protecting personal data while protecting your employees in full

On 17 March, the Government announced that the changes to the Off-Payroll rules (the 'New Rules'), due to come in on 6 April 2020, would be delayed by one year as part of a package of measures to ease pressure on businesses in light of the coronavirus outbreak. In these challenging times, the news was welcomed by clients and contractors concerned about the financial impact the changes would have on them.

The Government has, however, made it clear that this is a delay and not a cancellation of the New Rules which will now come into effect on 6 April 2021. Many companies have already planned or made changes to the way they engage contractors and will be wondering what to do.

Read our Delay to the Off-Payroll reforms – What does it mean for your business? briefing, where we have answered some of the questions we think such organisations may have.

Read the full Delay to the Off-Payroll reforms – What does it mean for your business? briefing

In an unprecedented move, the Government has announced a wage subsidy for employers affected by the Covid-19 pandemic. The Coronavirus Job Retention Scheme (Scheme) is a government-funded scheme that provides a contribution towards wage costs for employers who stand staff down as a result of the COVID-19 crisis.  Where the employer does not have work for an employee to do, the employer can make them a "furloughed worker" instead of making them redundant.  If the employer chooses to do this, then the Government will contribute 80% of that employee's salary (subject to a cap of £2,500 per month), plus employers national insurance contributions and the minimum automatic enrolment employer pension contributions on the reduced salary.  The Scheme will be open to all organisations, regardless of size, and all employees employed as at 19 March 2020.  The Scheme will initially be open for three months backdated to 1 March 2020 (although it could be extended by the Government if necessary). It is expected that the Scheme will be operational by late April. Employers are required to pay salary costs upfront in the usual way and claim reimbursement under the Scheme once operational.

There is a range of complex employment law issues for employers to consider when placing employees on furlough. We have been speaking with a number of clients about these. We have also produced a Q&A covering some of the most frequently asked questions about the Scheme, which is available here.

Read the full Coronavirus Job Retention Scheme briefing here

At a time when restrictive measures are being implemented by governments across the globe in response to COVID-19, we understand it is difficult for organisations to keep abreast of these developments.

With this in mind, and with the assistance of some of the leading lawyers across Europe, we have put together a high-level summary of some of these current government measures. By keeping this data up to date, we will seek to track developments across Europe and monitor progress towards the roll back and easing of lockdown measures.

We hope this information supports our clients during this unprecedented crises and assists them in plotting their way back to something like 'business as usual'.

Our interactive map indicates the level of restrictions on a country-by-country basis. 

International tracker - COVID-19 restrictions

The UK Government has just updated its guidance for Employers, Employees and Businesses on coronavirus (COVID-19). This is aimed at assisting employers and businesses in providing advice to their staff on how to help prevent spread of COVID-19, what to do if someone has symptoms of COVID-19 in a business setting and eligibility for sick pay. Employees are also given guidance on relevant information such as statutory sick pay and absence from work.

Our briefing below is intended to be a summary only of certain sections contained within the guidance.

Read our COVID-19: Health and Safety Guidance for Employers, Employees and Businesses briefing here.

Read the full COVID-19: Health and Safety Guidance for Employers, Employees and Businesses briefing here

Ofwat and Ofgem has published guidance (see Ofwat/ MOSL COVID-19 guidance update Ofgem's COVID-19 guidance webpage) to consumers and industry which gives insight into the approach the regulators are taking in response to COVID-19.

Read a summary of these updates in our COVID-19: Updates from OFGEM and OFWAT briefing.

Read the full COVID-19: Updates from OFGEM and OFWAT briefing

The COVID-19 (coronavirus) pandemic has taken a significant toll on both the aviation and maritime sectors. Regulators in both areas have taken measures both voluntarily and involuntarily to try and mitigate the spread of the COVID-19 and have implemented guidance on the implications on both sectors resulting from the dramatic downturn in customer use and restrictions on non-critical trade routes.

Read the COVID-19: Regulatory and Government Guidance for UK Aviation and Ports briefing here

Published government guidance and public announcements in light of COVID-19 state that businesses and workplaces should encourage their employees to work at home, wherever possible. As a result, remote working arrangements are now widespread due to the UK COVID-19 management strategy.

We have summarised the key points in our Homeworking: Health & Safety Considerations, Coronavirus (COVID-19) updates briefing.

Read the full Homeworking: Health & Safety Considerations, Coronavirus (COVID-19) updates briefing here

Over a year after its initial formation, on 31 March 2020 France, Germany and the United Kingdom (the "E3") confirmed that the Instrument in Support of Trade Exchanges ("INSTEX") had successfully concluded its first transaction; facilitating the export of medical goods from Europe to Iran to assist with Iran's response to COVID-19.

This briefing explores the following questions:

• What is INSTEX?
• Why was INSTEX not used previously?
• What next?

For further information, read our COVID-19: UK and EU's actions to circumvent sanctions speak louder than US words briefing. 

read COVID-19: UK and EU's actions to circumvent sanctions speak louder than U.S. words in full

The economic impact of COVID-19 is expected to be unprecedented, but so are government promises to help economies recover from that impact.

The speed and scale of the response to the pandemic has led to inevitable, unflattering comparisons with responses (or lack thereof) to the climate emergency. The global shutdown caused by COVID-19 has had immediate positive effects on global emissions and local air pollution levels, but these are expected to be largely short term. Longer term, there is scientific evidence that pandemics will increase in frequency on account of climate change, as habitat loss and higher temperatures result in animals and insects coming into closer contact with each other and humans. These factors in combination have led to a growing sense that national and international economic stimulus packages should focus not just on any recovery but on an environmentally sustainable recovery.

Our briefing covers the following:

• What has been promised so far?
• Support for green stimulus packages
• What could green conditions look like?
• What next?

 

read COVID-19 economic stimulus package - can we build back better? in full

The COVID-19/Coronavirus outbreak has made many aspects of our lives more difficult but pension scheme members are relying on scheme administration continuing as normal, so far as possible.

We have set out a checklist for pension scheme trustees of key matters they should be considering. Read our COVID-19: Checklist for pension scheme trustees briefing here.

Read COVID-19: Checklist for pension scheme trustees in full

As the UK's workforce works from home, Andy Lewis looks at how the pensions industry can respond together to COVID-19.

Just as in wider society, COVID-19 will test the pensions industry. In this article, focussing on pension trustees, I will briefly outline some practical and legal considerations that may help our industry rise to the challenge.

This is an extract from our Professional Pensions: Isolation does not mean we are alone briefing.

Read Professional Pensions: Isolation does not mean we are alone in full

Furlough, until recently not a recognised concept of UK employment law, has now entered the mainstream in response to the extraordinary circumstances of the COVID-19 pandemic. What furlough could mean for pension benefits will depend on what type of pension arrangement is provided by the employer, the specific rules of that arrangement and what changes the employer might be making to pay and benefits during that period. There are a number of potential pitfalls and complexities that may need careful navigation in relation to pensions. Salary sacrifice arrangements can further complicate the position. We unpick in this briefing some of the key issues for DB and DC arrangements.

Click here to read our Coronavirus Job Retention Scheme - Pension aspects briefing.

Read the full Coronavirus Job Retention Scheme - Pension aspects briefing here

The Pensions Regulator has published several pieces of guidance for trustees, employers and administrators on Coronavirus related issues.  

The summaries in our briefing are very abbreviated and intended as an indication of the content of the guidance. They are not a substitute for looking at the guidance itself.

The Regulator is generally taking a proportionate and risk-based approach to enforcement in light of the challenging situation.  Regulatory easements, where granted, are typically in force until 30 June 2020.

read Pensions Regulator guidance on Coronavirus related issues in full

One of the thorny questions currently troubling many pension scheme trustees is what to do about cash equivalent transfer value (CETV) quotations and transfer payments.

Please fill out the document request form to read more.

Covid 19 has prompted some swift action on the part of MHCLG, with relaxations in delivery times and temporary rights to changes of use for pubs and restaurants. There are also changes to the Planning Inspectorate's approach to appeals to be aware of.

Changes to planning to keep things moving:

• Relaxation of delivery times to retailers and distribution warehouses
• Temporary rights for hot food takeaways
• New guidance from the Planning Inspectorate in relation to appeals
• Delegated powers have been extended to grant planning officers "emergency decision-making powers" in order to determine certain planning and licencing matters.

 

For further detail, see our COVID-19: changes to the planning regime to help suppliers and businesses briefing.

Read COVID-19: changes to the planning regime to help suppliers and businesses in full

The majority of landlords and tenants have over the last year had a number of discussions about the parties' obligations under their leases and the extent to which they can be complied with during the Covid-19 pandemic. However, this is a constantly shifting landscape so these agreements may need to be reviewed from time to time, and will in particular come under fresh scrutiny at the point when the Government lifts the protective measures which it put in place during 2020.

In our note we discuss the following questions that tenants might have in respect of payments under their leases:

1. Requests to pay less rent;
   
   
2. Requests to suspend payment of rent and service charge;
   
   
3. Refusal to pay elements of the service charge;
   
   
4. Claims for compensation for a breach of quiet enjoyment or derogation from grant; and/or
   
   
5. An argument that the lease has come to an end as a result of frustration or forfeiture.

For more detail, read our note: COVID-19: Rent mitigation negotiations between landlords and tenants briefing.

Read COVID-19: Rent mitigation negotiations between landlords and tenants in full

In response to the COVID-19 outbreak, the Care Quality Commission and Public Health England have been publishing regular updated guidance documents for registered residential care providers to follow.

Some of the key actions currently being taken are summarised in our COVID-19: CQC and Public Health England's response to risk in the residential care home sector briefing.

Read COVID-19: CQC and Public Health England's response to risk in the residential care home sector in full

Many commercial tenants urgently need to reduce their rent payments and other payments due under their leases. The Coronavirus Act 2020 (the "CA") protects commercial tenants from eviction for non-payment of rent has helped tenants. However, it does not remove their obligation to pay rent and is presently of only three months' duration, expiring on 30 June 2020.  The Government will need to consider whether to extend this for longer and how repayments of arrears accruing in this period will be made.

This note focuses primarily on the considerations that are likely to arise in landlord and tenant negotiations, during the COVID-19 crisis.  Tenants will also be concerned about any exposure they have to previous landlords under authorised guarantee agreements, other forms of guarantee and, less commonly, under "Old Leases". If you have any concerns around residual and contingent liabilities in respect of leasehold interests you have assigned, we would be happy to discuss this further with you.

This is an extract from our COVID-19: Considerations for tenants briefing.

read COVID-19: Considerations for tenants in full

Tenants are approaching their landlords to ask for assistance in mitigating their financial outgoings.  They are requesting rent holidays, rent reductions, and monthly as opposed to quarterly rent payment schedules.  Some tenants are also seeking longer term variations of their leases. Tenants might also decline to pay rent or certain items of a service charge, and in some cases may try to exit their lease altogether.

Some tenants will be close to insolvency if they cannot reduce their liabilities. For them in particular, it may be difficult to justify treating landlords preferentially, by paying rent quarterly in advance for premises that are shut or barely trading, when their other business payments may only be payable in arrears or on a monthly basis. In the event of insolvency, rent payments might be treated as preferences of one creditor over another and might therefore be liable to being set aside. The directors of such tenants will be concerned to ensure that they are not infringing insolvency legislation.

We have seen several different types of request from tenants in respect of payments under commercial leases, and provide comments on these below. We hope this may help you to reply to similar queries from tenants. Please be aware that every situation is different and this note assumes standard commercial lease terms. You must also consider the full terms of a tenant's lease and any other information you have, including the terms of any superior leases, to ensure that your decision accords with this general guidance. We are happy to discuss this with you and to assist you in reviewing specific leases.

The position is likely to change as a result of legislation introduced to deal with issues for landlords and tenants arising from Covid-19. We will update this note regularly to reflect any changes. 

This is an extract from our COVID-19: Considerations for landlords briefing. 

read COVID-19: Considerations for landlords in full

Developers, pre-let tenants and funders are all looking hard at their development agreements, development funding agreements, agreements for leases and building contracts to assess what impact the Covid-19 pandemic, and the Government's response to it, will have on their current construction works in England. We outline in this note some of the key information and issues for such parties to consider before deciding whether or not to suspend or continue their works.

This briefing aims to answer the following questions:

• Should the site be closed?
• How should the site be protected while it is closed?
• What happens if there are delays to target and/or longstop completion dates in development agreements, development funding agreements and agreements for lease?
• Are extensions of time permitted under the Building Contract?

 

For further information, read our briefing titled The impact of COVID-19 delays on developments.

read The impact of COVID-19 delays on developments in full

As COVID-19 continues to spread rapidly across the UK, competition law is being relaxed for supermarkets, allowing them to cooperate to a greater degree than would normally be possible. To what extent can other businesses do the same?

If you fall foul of competition law, the penalties can be severe. But in a bid to ensure competition law enforcement does not impede necessary cooperation between businesses to deal with the current crisis, the UK Competition and Markets Authority has now published guidance regarding its approach to such COVID-19 cooperation.

This is an extract from our COVID-19 & competition law - guidance from UK regulator briefing. 

read COVID-19 & competition law - guidance from UK regulator in full

How far does the current COVID-19 crisis justify contracting authorities departing from the normal procedures under EU and UK public procurement rules?  In this briefing, we look at recent UK government guidance and highlight the key points, both for businesses bidding for contracts and contracting authorities looking to enter into new contracts on tight timescales.

This is an extract from our COVID-19: Procurement by public bodies briefing.

 

read COVID-19: Procurement by public bodies in full

Although the UK has left the EU, significant change will only take place after the transition period has expired and the UK has moved to a new relationship with the EU. The UK Government has a choice as to how quickly that change happens. Going fast allows the Government to claim that it is delivering on its core promise to "get Brexit done" – but risks a significant shock to the economy. The Government has (outwardly at least) given the impression that it leans towards a "fast" Brexit.

Does the coronavirus outbreak change this calculation?

In this briefing we discuss:

• The problems with a "fast" Brexit.

• Factors in favour of a "fast" Brexit; and

• How could the Government change course?
  
  

Read our Will COVID-19 change the UK's Brexit strategy? briefing here.

Read the full Will COVID-19 change the UK's Brexit strategy? briefing here

With COVID-19 dominating the news, Brexit may seem like a distant memory – but it hasn't gone away.  In this briefing, with the help of trade policy expert Dmitry Grozoubinski, we look at what's been happening in the Brexit negotiations, what can (and can't) be done by video conference and the prospects for an extension.

This briefing covers the following questions:

• Has any progress been made in the Brexit negotiations?
• Can it all be done by video conference?
• Would an extension of the transition period help?

 

To find out more, read our How is COVID-19 affecting the Brexit negotiations? briefing.

How is COVID-19 affecting the Brexit negotiations?

This year's AGM season looks set to face disruption from the COVID-19 outbreak. Companies will need to consider:

• the practical implications of holding a meeting, including potential closure of venues, travel restrictions and the negative perception of encouraging a physical gathering of shareholders;
• the business of the AGM and, in particular, the company's normal dividend programme;
• the need to ensure authorities put in place at the AGM give maximum flexibility in order to deal with any impact on the company's financial position and cash flow; and
• directors' duties to stakeholders and the market.
  
  

This is an extract from our AGMs and dividends 2020: COVID-19 implications briefing.

read AGMs and dividends 2020: COVID-19 implications in full

Private investments in public equity (or "PIPEs" as they are more commonly known) typically involve the issue of preference or ordinary shares, or convertible unsecured loan stock ("CULS"), by a publicly traded company, often to a private equity, venture, growth or other fund. The issue is usually done at a discount to the prevailing market value.

Given the economic crisis arising out of the COVID-19 pandemic, listed companies in the UK are looking at creative fundraising solutions to meet their cashflow requirements, and PIPE transactions may fit the bill, although they are not without their issues.

The principal complexities for UK public companies undertaking PIPEs can be found in company law and in the Listing Rules (which apply to all companies whose shares are admitted to the Official List). The investor protection committee guidelines issued on behalf of UK institutional investors by bodies such as the Investment Association ("IPC Guidelines"), which apply to all companies on the Official List, can also create issues. Although compliance with IPC Guidelines is not mandatory, non-compliance may result in any shareholder approval required for the PIPE not being obtained.

The AIM Rules create fewer hurdles for PIPEs and therefore in practice it will be a lot easier to effect a PIPE in relation to an AIM company than it will be for one listed on the Official List. The IPC Guidelines do not strictly apply to AIM companies, although the proxy agencies do increasingly apply the same principles to their voting recommendations.

For further information on the matters to consider when looking at a PIPE, read our 2020: A new PIPE-line? briefing.

read 2020: A new PIPE-line? in full

On 8 April, in response to the COVID-19 crisis, the FCA announced a series of temporary measures aimed at helping listed companies to access capital through equity fundraisings.

Whilst these measures, which are explained in detail in their Statement of Policy, do not go as far as was hoped by some, they provide some additional flexibility to companies who have or develop a need to raise additional funding to shore up their balance sheet as a consequence of the COVID-19 crisis and also clarify the FCA's position on working capital statements.

We consider the detail of the changes in our briefing, but in short they cover:

• The ability to include COVID-19 crisis related qualifiers in working capital statements.
• Alternatives to general meeting approval for class 1 and related party transactions.
• Support for increased approval being sought to disapply pre-emption rights.
• The use of a simplified prospectus for secondary issuances.

 

read Listed companies: FCA equity fundraising measures in full

Listed companies: Fundraising options, duties and disclosure

COVID-19 has been a shock to the system of even the best capitalised companies, with cashflow squeezes causing most companies to consider their funding positions. This briefing focuses on the various equity fundraising options for UK companies needing to tap the market and explores the changing nature of directors' duties in this context, as well as the company's disclosure obligations.

This briefing covers the following topics:

• Fundraising options
• Disclosure obligations
• Directors' duties to shareholders and creditors
• Pitfalls to avoid

 

For further information, read our Steering your company through uncertain times (Official List companies) briefing. 

read Steering your company through uncertain times (Official List companies) in full

AIM companies: Fundraising options, duties and disclosure

COVID-19 has been a shock to the system of even the best capitalised companies, with cashflow squeezes causing most companies to consider their funding positions. This briefing focuses on the various equity fundraising options for UK companies needing to tap the market and explores the changing nature of directors' duties in this context, as well as the company's disclosure obligations.

This briefing covers the following topics:

• Fundraising options
• Disclosure obligations
• Directors' duties to shareholders and creditors
• Pitfalls to avoid

 

For further information, read our Steering your company through uncertain times (AIM companies) briefing. 

read Steering your company through uncertain times (AIM companies) in full

As the COVID-19 (coronavirus) outbreak worsens in Europe, the Financial Conduct Authority (FCA) and the European Securities and Markets Authority (ESMA) are working to try and mitigate its impact on the financial markets, financial services firms and their customers.

Some of the actions being taken are summarised in our Regulatory measures for financial services firms briefing.

read Regulatory measures for financial services firms in full

The ever increasing restrictions on movement and forced physical closures of businesses as a result of COVID-19 are a serious challenge to businesses. Understanding the risks in each part of your business is key to ensuring continuity in times of severe disruption like this.

Key questions for treasury functions:

• Do I have access to the terms and conditions which govern my derivatives?
  
  
• Managing cash-flows:
  - What are the payment terms?
  - What happens if I don't pay?
  - Can I defer or restructure my payments?
  
  
• Early termination triggers:
  - Can my counterparty terminate early?
  
  
• Logistics and business continuity:
  - Are we in a force majeure scenario?
  
  

Our briefing covers these issues for over-the-counter (OTC) derivatives transactions which are executed using either a 1992 Master Agreement or 2002 Master Agreement in the form published by the International Swaps and Derivatives Association (ISDA).

This is an extract from our COVID-19: issues for treasurers - derivatives and hedging briefing.

read COVID-19: issues for treasurers - derivatives and hedging in full

There have been increasing concerns in recent weeks that UK insolvency law does not accommodate the short-term impact of COVID-19 on many businesses. In response, the Business Secretary announced on 28 March that the UK's insolvency rules would be amended as part of the Government's wider business support package. Whilst the measures that the Government intends to implement have not yet been fully detailed, this note summarises what has been announced so far and what we might expect, based on the Business Secretary's comments.

This is an extract from our COVID-19: Insolvency law proposals for mitigating the short-term effects on viable businesses briefing. 

read COVID-19: Insolvency law proposals for mitigating the short-term effects on viable businesses in full

Over the last 4 weeks, in the face of COVID-19 the worldwide economy has experienced the sorts of pressures not seen since the Great Depression. Businesses around the world have been forced to close their doors; we have seen government interventions which, only 3 months ago, would have been unthinkable; and terms such as "social distancing" and "furloughing" have become common parlance.

Whether or not all of this will result in a seismic shift for the private equity industry in the longer-term remains to be seen, but as dark clouds gather once again liquidity is the number 1 priority for GPs and fund managers. Whilst new deals are largely on hold, with global M&A activity for Q1 2020 down 28% year-on-year, GPs and managers are urgently assessing the potential additional funding requirements of their existing portfolios to ensure they have sufficient firepower to inject cash where it's needed. Older vintage funds, where there is significant NAV at risk and (perhaps) little remaining by way of uncalled investor commitments, are particularly exposed.

We have seen a significant uptick in enquiries from GPs and managers, investors, lenders and the wider advisory universe about the tools available to provide that liquidity. Step forward NAV facilities and preferred equity products, whose day (or, perhaps more realistically, year) it is in the sun. From a practical perspective, is there going to be enough capital available to cover the GP-demand for products of this nature? Our (and the wider market's view) is that there will not be, so first mover advantage could be crucial.

This is an extract from our COVID-19: Liquidity, liquidity, liquidity briefing. 

read COVID-19: Liquidity, liquidity, liquidity in full

The Financial Conduct Authority (FCA) has set out its expectations of solo-regulated firms under the Senior Managers and Certification Regime (SMCR) in light of the coronavirus (COVID-19) pandemic.

The FCA's expectations may be found here.

Read our summary here.

read COVID-19: FCA's expectations under SMCR in full

Given the potential business disruption triggered by the COVID-19 Coronavirus, we set out here our thoughts on signing and closing logistics when signatories are forced to work remotely.

• Virtual signings for loan financings are nothing new. Since the infamous Mercury Tax case in 2008, market practice has settled on established ways for remote signatories to sign, scan and email signature pages so that documents can be executed without the need to handle 'wet ink' signatures.
• e-signatures were brought into focus recently when the Law Commission issued a report in 2019 confirming their validity.
• Various platforms (such as DocuSign) allow signatories to execute documents by way of an e-signature on a mobile device, rather than having to print, sign and PDF pages, post them, or attend meetings in person.
• Given the introduction of travel bans on public health grounds, parties may also consider appointing a power of attorney to sign key documents, to ensure availability of an authorised signatory in the relevant jurisdiction.
• It is common for board meetings to be held by telephone and/or for board resolutions to be passed by written resolution.
• Despite best efforts to achieve a relatively paper-free transaction, thought may need to be given to the logistics for the physical delivery of original documents and other transaction deliverables (such as share certificates) at a time when offices are closed.
  
  

This is an extract from our COVID-19: closing the deal when the office is closed briefing.

read COVID-19: closing the deal when the office is closed in full