The governmental response

Global overview and supporting business guide

As governments across the globe take drastic action to help businesses weather the storm from COVID-19, we have produced a global guide which provides an insight into the issues likely to impact businesses and the key measures taken by governments across more than 50 countries, from financial support and business protection, through to employment and access to justice.



Content accurate as at 20 April 2020

What form of direct liquidity support has the government made available?

The UK government has launched four major specific lending schemes:

  1. the COVID Corporate Financing Facility which is a new lending facility from the Bank of England to help support liquidity among larger non-financial firms which make a material contribution to the UK economy and which were regarded as investment grade on 1 March 2020 (as determined by one of four main rating agencies (DBRS Morningstar, Fitch, Moody’s and S&P) or where evidenced by the firm’s existing lenders based on their internal ratings). This financing will be provided by a Bank of England entity buying commercial paper issued on standard terms by the issuer. The securities will be purchased at a spread (currently up to 60 basis points) above a reference rate based on the current sterling overnight index swap rate.
  2. the Coronavirus Business Interruption Loan Scheme, being run by the British Business Bank, which provides finance up to GBP 5 million to UK-based borrowers on repayment terms up to six years for firms with a turnover of up to GBP 45 million. This is accessed via a participating lender and the government provides the lender with a guarantee in respect of 80% of the amount advanced. It is available to businesses from any sector except banks and building societies, insurers and reinsurers, public-sector organisations, trade unions and employer, professional, religious or political membership organisations.
  3. the Coronavirus Large Business Interruption Loan Scheme, is an additional scheme announced on 3 April 2020 for larger companies. It will provide a government guarantee of 80% to enable banks to make loans of up to £25 million to companies with an annual turnover from £45 million up to £250 million and up to £50 million for companies with an annual turnover above £250 million who are unable to secure regular commercial financing.  To be eligible, companies must have a borrowing proposal which the lender would consider viable, were it not for the COVID-19 pandemic and which the lender believes will enable the business to trade out of any short-term to medium-term difficulty.  Companies accessing the scheme must not be a bank, building society, insurer, reinsurer or public-sector organisation.  The new scheme which opened on 20 April 2020 is being made available through commercial lenders and is expected to support a wide range of businesses to access finance products including term loans, revolving credit facilities (including overdrafts), invoice finance and asset finance available on repayment terms of up to three years. 
  4. The Future Fund convertible loan scheme is a new scheme announced on 20 April 2020 with an initial £250 million made available.  When made available in May 2020, this will make available convertible loans of between £125,000 and £5,000,000 to UK based early stage companies subject to equal match funding from private investors.  The eligibility criteria require that the business is an unlisted UK registered company that has previously raised at least £250,000 in equity investment from third party investors in the last five years and has a substantive economic presence in the UK.  If the company is a member of a corporate group, only the ultimate parent company, if a UK registered company, is eligible to receive the loan.  The funding is to be used solely for working capital purposes and not to repay borrowings, make dividend or bonus payments or pay any advisory or placement fees or bonuses to external advisers.  The funding is designed to be bridge funding that shall automatically convert into equity on the company’s next qualifying funding round at a minimum conversion discount of 20% to the price set by that funding right with a company repayment right in respect of the accrued interest.  The discount rate will be higher if a higher rate is agreed between the company and the matched investors.  The government shall be entitled to transfer the loan and any shares following conversion with restriction to an institutional investor acquiring a portfolio of the government’s interest in at least ten companies owned in respect of the Future Fund.

In addition, the Bank of England’s Financial Policy Committee reduced the UK countercyclical capital buffer to 0% of banks’ exposures to UK Borrowers supporting an increased ability of banks to supply credit to businesses and households. The Monetary Policy Committee has reduced the bank rate to 0.1%, its lowest ever rate and announced a GBP 200 billion increase in its programme of purchases of UK government bond and sterling non-financial investment-grade corporate bond purchases.


What form of additional financial support is there for employment?

Coronavirus Job Retention Scheme – all UK employers with a PAYE scheme can access support to continue paying part of their employees’ pay in circumstances where they have been furloughed due to COVID-19. This applies to employees who were employed and included on their employer’s electronic payroll return before 19 March 2020 and have been told to stop working, but who are being kept on the payroll, otherwise described as ‘furloughed workers’. HMRC will reimburse the employer for 80% of their wages, up to GBP 2,500 per month, plus the employer social security costs and pension contributions due on those wages. The scheme applies in its current form from 1 March to 31 July 2020.  A revised scheme will apply from August to October 2020 so that employers who are currently using the CJRS can bring back furloughed employees part-time. At that stage employers will be asked to share the costs of employees’ salaries - full details will be published by the end of May 2020.

Statutory sick pay relief - employers with fewer than 250 employees as at 28 February 2020 are entitled to reimbursement of statutory sick pay for up to two weeks per employee for COVID-19 related absences. Statutory sick pay is GBP 95.85 per week from 6 April 2020.


What national and local tax reliefs / payment holidays have been introduced?

The UK government has deferred VAT payments for three months for payments due in the period from 20 March 2020 to 30 June 2020. A 12-month business rates holiday has also been introduced for all retail, hospitality and leisure and nursery businesses in England for the 2020/2021 tax year.

In addition, small business grant funding of GBP 10,000 has been made available for all businesses in receipt of small business rate relief or rural rate relief and grant funding of GBP 25,000 has been made available for retail, hospitality and leisure businesses with property with a rateable value between GBP 15,000 and GBP 51,000.



Last updated: December 15 2020

What changes to rights of utility companies and property owners have been introduced?

Property owners

Closure of premises

As regards the construction industry, following the UK government’s measures on 23 March 2020 to force people to stay at home and close non-essential premises, and subsequent clarification that construction sites might only stay open if social distancing guidance could be observed, many construction sites closed.  The government produced further sector specific guidance on 7 April 2020 which makes it clear that sites may remain open if social distancing is observed where possible.  Where social distancing is not possible in connection with a particular activity, consideration should then be given as to whether the activity must continue in order for the site to remain operational.  Where it must, then all possible mitigating risks should be taken to reduce the risk of transmission of infection.  The guidance includes further measures to be adopted on construction sites when planning and carrying out work and manning vehicles in order to minimise the risk of infection.  This guidance is supported by a third edition of the Construction Leadership Council’s Site Operating Procedures, published on 15 April 2020. On 6 April 2020 (and again on 1 May 2020), the Scottish government issued guidance to the construction industry advising that construction work in non-essential sectors (the definition of which includes domestic housing, office buildings and other commercial properties, leisure, and retail) should cease until further notice. The guidance states that construction work may continue only on ‘essential’ projects, and only then where social distancing and health and safety guidance may be complied with.

Outside of the construction industry, the measures introduced on 23 March 2020 required all non-essential shops and community spaces to close. In its first major review of those measures, the UK government announced changes on 10 May 2020 which apply in England. Anyone who cannot work from home is encouraged to go to work (such as those in construction or manufacturing), but avoid public transport where possible. The government has published guidance for employers, employees and the self-employed on how to work safely during Covid-19. There are eight different guides covering a range of different types of workplace.

Non-essential shops and community spaces should remain closed for now, but the government envisages that, after 1 June at the earliest, the phased re-opening of shops may begin (depending upon the infection rate at that time). As a third stage, from July at the earliest, it is hoped that some hospitality and other public places may be able to re-open if they are safe and social distancing can be observed. The more stringent measures announced on 23 March remain in place outside of England.

Right to forfeit for non-payment of rent suspended

The Coronavirus Act 2020 has suspended a landlord’s ability to take forfeiture action for business tenancies in England and Wales, so that business tenants who cannot pay their rent will be protected from forfeiture. These measures mean no business tenant can be forced from their premises if they miss a payment between 26 March 2021 and 31 March 2021. Equally, during this period, no action by a landlord (other than giving an express waiver in writing) will be regarded as waiving a right of re-entry or forfeiture for non-payment of rent. The Coronavirus Act 2020 merely suspends a landlord’s ability to forfeit a lease during the suspension period. It does not prevent rent and other sums due under the lease from accruing. These sums, and interest, remain the liability of the tenant, so the Act merely offers breathing space for tenants. It does not waive the tenant’s liability to pay

The Coronavirus (Scotland) Act 2020 introduces a moratorium on irritancy (the Scottish equivalent of forfeiture) by lengthening (from 14 days to 14 weeks) the minimum period of notice which a landlord must give to a business tenant to pay arrears of rent (or other payments due under a lease) before the landlord can initiate court proceedings to terminate the lease for non-payment.

Other measures to protect tenants against aggressive debt recovery actions

In April 2020, the government announced its intention "to introduce temporary new measures to safeguard the UK high street against aggressive debt recovery actions during the coronavirus pandemic." These measures have been introduced by the Corporate Insolvency and Governance Act 2020 and are not sector specific and apply to any registered or unregistered company that can be the subject of a winding-up petition. 

The Act prevents any statutory demands made against companies in the period between 1 March 2020 and 31 March 2021 from being used as the basis of a winding-up petition at any point on or after 27 April 2020.

The Act also states that a creditor may not present a winding-up petition during the period 27 April 2020 to 31 March 2021, unless the creditor has reasonable grounds for believing that either (i) COVID-19 has not had a financial effect on the debtor company or (ii) the company would have been unable to pay its debts regardless of COVID-19.  Similarly a court will not make a winding-up order on the basis of a petition presented in that period unless the court is satisfied that the company would have been unable to pay its debts regardless of COVID-19.

The government has also introduced secondary legislation to provide tenants with more breathing space to pay rent by preventing landlords using the CRAR (Commercial Rent Arrears Recovery) procedure unless they are owed 189 days (rather than just 7 days) of unpaid rent. So far, no announcement has been made on whether there are plans to amend the rules on summary diligence (the Scottish equivalent to the CRAR procedure) whereby officers of the court have power serve a charge for payment and then on expiry of the charge to attach goods and money in the property in order to recover unpaid rent.  As lockdown is easing, it may be that there are no such amendments. 

More detail on the restrictions on winding-up processes can be found here. A fuller analysis of protections for tenants and rights retained by landlords is here.

Business rate relief

The UK government has introduced a 12-month business rates holiday for retail, hospitality and leisure businesses, including estate agents, lettings agencies and betting shops and, in addition, certain nurseries in England that have closed as a result of COVID-19. In Scotland, retail, hospitality and leisure businesses will get 100% rates relief for 12 months. To qualify for this relief, a property has to be occupied, but properties that have closed temporarily due to the government's coronavirus advice will be treated as occupied. Scottish airports will also get 100% rates relief for 12 months, as will organisations providing handling services for scheduled passenger flights at Scottish airports.

Use of premises as takeaways

Following the closure of pubs and restaurants after 20 March 2020, the UK government has also announced its position on the use of these premises to provide takeaway food, which position differs between England, Wales and Scotland. Legal advice should be obtained to confirm the position; please get in touch with your usual DLA Piper contact for help.

Use of premises for healthcare

Local authorities and healthcare providers have been given temporary development rights to provide emergency healthcare facilities in England and Wales, subject to conditions and limitations.

Extension of validity of planning consents

In Scotland planning permissions which are about to expire are granted an automatic 12 month extension.  These provisions do not (as yet) apply in England and Wales.

Utility companies

The government has agreed several measures with the energy industry to support vulnerable people through COVID-19. The measures include ensuring prepayment and pay-as-you go customers remain supplied with energy. 

Has the government given guidance or introduced laws to treat COVID-19 as a force majeure event?

No. Force Majeure in commercial contracts remains an entirely contractual principle.


Last updated: May 14 2020

What changes to employment law have been introduced (including social security entitlements and health and safety requirements)?

Employees who are required to self-isolate for 14 days (due to a member of their household displaying symptoms) and cannot work from home are entitled to SSP even if they do not have symptoms themselves.

Employers must not require employees covered by the government’s 12 week shielding measures (those with underlying health conditions/risk factors/pregnant workers) to attend work, but they are permitted to work from home if practicable. These employees can be designated as furloughed employees under the Coronavirus Job Retention Scheme.

General health and safety obligations continue to apply and have been adapted to the new situation.

For an analysis of financial support available regarding employment, please refer to the section regarding Financial Support.


Last updated: May 14 2020

When do businesses have to close their properties? 

Businesses and workplaces should encourage their employees to work at home where this is possible. Certain businesses and premises must remain closed, such as restaurants, non-essential retail businesses, cinemas and gyms. These businesses were asked to close from 24 March 2020. The first review of these measures will take place three weeks from that date.

A full list of businesses and premises that must close and any exceptions can be found here.



Last updated: May 14 2020

Have there been any changes to financial market regulations (e.g. in relation to short selling)?

There have been no relaxations in the duty to keep the market up to date. The Market Abuse Regulation remains in force and the FCA has reminded listed companies that they must continue to assess carefully what information constitutes inside information at this time, recognising that the global pandemic and policy responses to it may alter the nature of information that is material to a business’s prospects.

The Financial Reporting Council has issued guidance for companies on corporate governance and reporting requiring them to develop and implement mitigating actions and processes, consider how to secure reliable and relevant information and to pay attention to capital maintenance. They stress that boards are required to have a “reasonable expectation” of the company’s viability but acknowledge that this will carry a much lower level of confidence than usual.

Some European countries have introduced short selling bans and the FCA has followed those banks, where requested, in respect of shares for which relevant European National Competent Authorities are responsible. The FCA has not introduced such a ban on UK shares.


What additional requirements have been placed on financial institutions?

The Prudential Regulation Authority (“PRA”) has issued guidance to firms on forward-looking expected credit loss estimates and stated that their expectation is that extension of payment holidays should not automatically result in the loans triggering defaults under the EU Capital Requirements Regulation. Lenders are urged to consider carefully their responses to potential breaches of covenants arising directly from COVID-19 and its consequences. Where the uncertainties are of a general nature or are firm-specific but unrelated to the solvency or liquidity of the borrower, the PRA would expect lenders to consider the need to treat them differently compared to uncertainties that arise because of borrower-specific issues and in doing so consider waiving the resultant covenant breach.

The PRA has reminded firms that the extraordinary circumstances are likely to require changes to usual practices in relation to financial information as audits are likely to include modified and scope limited audit opinions and disclosures that management is aware of material uncertainties related to events or conditions that may cast significant doubt upon the entity’s ability to continue as a going concern.


What mortgage and consumer credit changes and protections have been introduced?

The FCA issued guidance requiring mortgage lenders to grant customers a payment holiday for an initial period of three months, where they may experience payment difficulties as a result of COVID-19 and where they have indicated they wish to receive one and to ensure that there is no additional fee or charge (other than additional interest) as a result of the payment holiday. Firms are also required to take steps to ensure that the payment holiday does not have a negative impact on the customer’s credit score. The FCA has also indicated that it does not consider that repossession will be in the best interest of the customer and should not be commenced or continued unless the regulated firm can demonstrate clearly that the customer has agreed that it is in their best interest.


Last updated: May 14 2020

Have changes been made to annual reports filing formats and deadlines and AGMs for companies generally?

Companies can apply for a three-month extension to file their accounts with Companies House. Applications citing COVID-19 or health matters will be automatically granted an extension. The statutory deadline for holding an AGM has not yet been formally extended.


Have there been changes to laws and regulations about holding board meetings?



Have there been any changes to foreign investments laws?



Regarding listed companies, are there any new requirements on annual and interim financial reporting obligations?

Yes, companies traded on the Main Market have been given a two-month extension to the requirement to publish their annual accounts within the usual four months after the end of the financial year.
Companies traded on AIM are required to publish their annual accounts within six months after the end of the financial year; those with financial year ends between 30 September 2019 and 30 June 2020 are able to apply for a three-month extension to this deadline.


Regarding listed companies, are there any new requirements on the holding of shareholder meetings?

The government has announced that it will bring forward legislation to ensure that companies required to hold AGMs can do so safely, consistent with the government's restrictions on movement and gatherings. The legislation will temporarily give companies greater flexibility, including holding AGMs online or postponing the meetings. Draft legislation has not yet been published. In the meantime, due to the UK government’s “stay at home” measures which were passed into law on 26 March 2020, a practical solution is to convene a physical meeting and arrange for it to be attended in person by the minimum number of people needed to form a quorum. Other shareholders should be informed that they cannot attend in person and strongly encouraged to submit proxy votes.


Last updated: 30 September 2020

What changes to the law have been introduced to protect against claims by creditors?

The Corporate Insolvency and Governance Act 2020 has the overarching objective of providing businesses with flexibility and breathing space to continue trading during the COVID-19 outbreak. The Act, introduces the following permanent and temporary measures:

A. Temporary measures:

1. Wrongful trading – Legislation on wrongful trading provides that directors can become personally liable in a subsequent insolvency process of a company if they fail to take every step to minimise potential losses to creditors once there is no reasonable prospect of avoiding insolvency. Generally, directors will not become personally liable for company debts unless their action has contributed to a worsening of the company’s financial position. The Act states that when the court is considering whether a director will be required to contribute to a company’s assets, it is to assume that the director is not responsible for any worsening of the financial position of a company or its creditors during the period 1 March 2020 to 30 September 2020. A second suspension on wrongful trading was announced on 26 November 2020 and applies for the period between 26 November 2020 and 30 April 2021.

However, directors should still act with due care and diligence and seek to minimise loss to creditors. The rules on fraudulent trading and director disqualification remain in place and so directors should continue to take advice and minute their decisions, particularly on incurring new credit, carefully.

Once the wrongful trading suspension is lifted, directors will again need consider their actions against a backdrop of potential wrongful trading liability, but as noted above the behaviours expected of directors while the suspension has been in place are very similar to what will be expected absent the suspension.

More detail on the changes to wrongful trading can be found here.

2. Winding-up petitions – The Act prevents any statutory demands made against companies in the period between 1 March 2020 and 31 March 2021 from being used as the basis of a winding-up petition at any point on or after 27 April 2020.

The Act also provides that a creditor may not present a winding-up petition during the period 27 April 2020 to 31 March 2021, unless the creditor has reasonable grounds for believing that either (i) COVID-19 has not had a financial effect on the debtor company or (ii) the company would have been unable to pay its debts regardless of COVID-19.  Similarly a court will not make a winding-up order on the basis of a petition presented in that period unless the court is satisfied that the company would have been unable to pay its debts regardless of COVID-19.  

These restrictions were initially in place until 30 September 2020, but were extended by regulation to apply until 31 December 2020. The restrictions were further extended on 9 December 2020, therefore will remain in place until 31 March 2021. 

More detail on these measures can be found here.

B. Reforms to insolvency law:

1. Moratorium: The Act introduces a new 20 business day moratorium (capable of being extended) for most insolvent or near insolvent companies to allow them breathing space from creditor enforcement action in order to formulate and pursue a rescue plan.

During the moratorium, a company will have a payment holiday for some pre-moratorium debts.  However, the company must continue to pay certain debts including newly incurred liabilities, payments for new supplies, rent in respect of the moratorium period, certain payments due to employees, and debts under financial contracts, including lending contracts. If those debts are not paid, the moratorium will end.

An insolvency practitioner, called the ‘monitor’, will be appointed to supervise the moratorium, and must be, and remain, of the view that a rescue of the company will be possible.

The moratorium is broadly similar to the administration moratorium, and includes restrictions (among others) on insolvency proceedings, enforcement of security, and forfeiture.

More detail on the moratorium can be found here.

2. Restructuring Plan

The Act also introduces another new tool for distressed companies, the restructuring plan.  The restructuring plan is modelled on the existing scheme of arrangement process but a distinguishing feature is that it provides for cross-class cram-down bringing the UK closer to the model used in US Chapter 11 and in other jurisdictions.  

Companies which have or are likely to encounter, financial difficulties that are affecting (or will or may affect) their ability to carry on business as a going concern may use the process to implement a compromise or arrangement between the company and its creditors or members with the aim of dealing with the company’s financial difficulties.

The restructuring plan has been created to be very flexible and will be able to cover financial and operational restructurings eg amend and extend transactions, debt for equity swaps, asset disposals and resizing all types of debt.

The restructuring plan does not include an inbuilt moratorium but a company could invoke the new moratorium to protect against creditor action while a restructuring plan is being pursued.   

More detail on the restructuring plan can be found here.

3. Termination of Supply Contracts

Often when a company enters into an insolvency or restructuring procedure, suppliers stop or threaten to stop supplying the company. 

The Act includes provisions preventing a supplier from terminating a contract or supply, or doing any other thing, simply because the customer has entered an insolvency process (this includes the new restructuring plan and the new moratorium).  Suppliers will also be banned from insisting on payment of sums falling due prior to the insolvency as a condition of continued supply. It is hoped that this will help continuity of business, minimise trading interruptions and consequently preserve business value and returns to stakeholders. 

More detail on these changes can be found here.


Last updated: May 14 2020

Have litigation procedures been adjourned / postponed nationwide?

England and Wales

  • Criminal: Jury trials that are already underway, continue. There will be no new jury trials. The Crown Courts and Magistrates courts are only covering urgent work (e.g. overnight custody and people brought from prison).
  • Civil: There is no national hold on litigation and limitation periods continue to run. Most courts remain open but are generally only dealing with urgent hearings and applications. Hearings that do take place are being conducted by video (Skype or similar) or telephone. Parties are expected to be flexible and proactive in suggesting how the court should deal with their proceedings. However, the courts retain powers to make directions in this regard (including to adjourn).

Her Majesty’s Courts and Tribunal Service is providing daily operational updates on its website. This site also provides links to COVID-19 related guidance issued by individual courts.


The position in Scotland is similar. The Court of Session, the High Court and ten sheriff courts remain open but are generally only dealing with urgent business. They are generally doing so by way of written submissions or telephone hearings. Operational updates are provided on the Scottish Courts and Tribunals Service website.


What exceptions to postponement exist?

England and Wales



Hearings are being continued or adjourned on an administrative basis.


Have procedural time limits been suspended or extended?

England and Wales

Not officially, but the courts are generally adopting a more flexible position. For example, (i) the Supreme Court (the highest civil court) has directed that parties may agree extensions of up to three weeks without obtaining court approval; and (ii) the High Court recently agreed a 56-day extension in a personal injury case. Parties should bear in mind the provision of the overriding objective of the Civil Procedure Rules, that unnecessary disputes over procedural matters are discouraged.


No. If a document needs to be lodged in accordance with a court timetable or interlocutor, it should be lodged by email (where the rules allow) or by post.


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