Ipso facto meaning

Flowchart This Flowchart explains the criteria that need to be met for the court to find a transaction amounts to an extortionate credit transaction and order relief. It should be considered with Practice Note: Extortionate credit transactions—corporate and personal insolvency...

This checklist of resources highlights key considerations when preparing, reviewing and negotiating commercial contracts to take account of the limits on ipso facto provisions brought in by the Corporate Insolvency and Governance Act 2020 (CIGA 2020), and to ensure agreements remain compliant and workable on insolvency. Corporate Insolvency and Governance Act 2020-the impact for commercial lawyers CIGA 2020 amended the Insolvency Act 1986 (IA 1986), introducing measures to secure the continuity of essential supplies and to curtail contractual termination rights triggered by insolvency (the so-called ‘ipso facto’ clauses) in contracts for goods and services. The issues most pertinent to general commercial practitioners when drafting and negotiating contracts are: contractual rights to terminate for an insolvency event, or to take any other step because of a customer’s insolvency, in contracts for the supply of goods and services, are no longer effective the creation of a company moratorium, available to all companies, enabling companies to develop restructuring proposals without creditor pressure the introduction of a...

INSOL Europe/LexisR&I joint project on implementation of EU Directive 2019/1023—Bulgaria Lexis R&I and INSOL Europe are gathering articles from INSOL Europe’s membership and Country Coordinators, explaining how EU Member States have put into practice Directive (EU) 2019/1023 of the European Parliament and of the Council of 20 June 2019 on preventive restructuring frameworks, on discharge of debt and disqualifications, and on measures designed to enhance the efficiency of procedures relating to restructuring, insolvency and discharge of debt, which also amends Directive (EU) 2017/1132 (the EU Directive). A summary table of the outcomes prepared by INSOL Europe in association with Lexis R&I can be accessed here: INSOL Europe/Lexis+® UK Joint Project on EU Harmonisation Directive 2019/1023: consolidated table. As a general rule, you should seek advice from local lawyers in the relevant jurisdiction to confirm the measures currently in effect and the implications of any particular circumstances or nuances of your case. Question 1: When did/will the new restructuring law come into force? What is/are the name...

Introduction The UK’s disapplication of so‑called ipso facto clauses—contract terms allowing a party to end the agreement when insolvency proceedings begin against the other—was made a permanent feature by the Corporate Insolvency and Governance Act 2020 (CIGA 2020). For deeper commentary on CIGA 2020’s reforms, see News Analysis: Corporate Insolvency and Governance Act 2020—the rise of the moratorium and restructuring plan and the fall of the Scheme? Halting such terminations marks a significant shift in UK insolvency practice. Ipso facto defaults are standard in most formal agreements, save for the briefest or most transitory. Further, English authority has treated a counterparty’s insolvency as repudiatory where it deprives the insolvent of the ability to perform. Statutes invalidating these provisions exist in many jurisdictions. The UK legislation mirrors the conventional model: first declaring insolvency‑triggered events of default ineffective, then carving out financial markets and other exceptions. In the UK context, those exclusions are extensive. They have long traditionally been embedded as default triggers in comprehensive contracts, with only the most short‑lived...

INSOL Europe/LexisNexis research on implementation of the EU Directive LexisPSL is collaborating with INSOL Europe on a joint initiative to gather articles from INSOL Europe members and Country Coordinators explaining how EU Member States have implemented Directive (EU) 2019/1023 of the European Parliament and of the Council of 20 June 2019 on preventive restructuring frameworks, on discharge of debt and disqualifications, and on steps to enhance the efficiency of procedures concerning restructuring, insolvency and discharge of debt, which also amends Directive (EU) 2017/1132 (the EU Directive). A consolidated table is available at Practice Note: INSOL Europe/Lexis+® UK Joint Project on EU Harmonisation Directive 2019/1023: consolidated table. As always, local lawyers in the relevant jurisdiction should be consulted to verify the measures currently in force and the effect of any particular circumstances or nuances of your case. Question 1: When did/will the new restructuring law come into force? What is/are the name of the new proceedings which comply with the EU Directive? In Poland, the EU Directive came...

The life sciences industry Comprises a broad constellation of stakeholders, spanning small university spin‑out biotechs built around a single discovery and research team through to vast, global ‘Big Pharma’ firms commercialising and promoting blockbuster medicines across multiple markets. Across that continuum sit, among others, contract research organisations, contract manufacturing organisations, specialist logistics and distribution providers, wholesale and retail pharmacies, and, increasingly, technology and AI businesses offering support and capability. Countless enterprises contribute to the life cycle of a pharmaceutical product—a journey frequently laden with hazards and uncertainty, and one that is operationally complex for most organisations at every step for participants overall. Bringing a medicinal product to market is thought to take 12 to 15 years, with a significant likelihood of failure; only a minute fraction of candidates entering pre‑clinical studies will secure regulatory clearance for use in people over that path over time. Beyond the extraordinarily high costs of launch, the sector faces mounting price pressures from industry ‘payers’, who require evidence not only of safety and efficacy...

This Practice Note offers guidance for the commercial practitioner on identifying when a company is encountering significant financial distress. It also condenses the key matters to prioritise to steady the business whilst evaluating the options available to the company, and outlines considerations for a business trading with a company in financial difficulty... Establishing serious financial difficulty Signals can usually be detected in a company’s financial statements and management accounts, as well as in communications with major suppliers and debt providers (eg banks, supplier statutory demands, etc). If the board fails to deal with these indicators, they will, in most cases, result in a value‑destroying formal insolvency of the company... Warning signs heightened competition causing loss of key customers and tighter margins an outmoded business model due to technological advances or shifts in customer demand/revenue channels weak cash generation/poor working capital management excessive debt and...

This Practice Note examines retention of title clauses, also described as reservation of title, ROT or Romalpa clauses. It reviews how these clauses may safeguard a creditor-seller against a debtor-buyer’s insolvency, as well as their limits. It outlines the principal features of such clauses and distinguishes between basic and extended forms, including ‘all monies’ and ‘proceeds of sale’ provisions. It also addresses practical issues around incorporating ROT terms, enforcement, and other protective avenues open to a seller. Simple retention of title clauses Extended retention of title clauses, including ‘all monies’ and ‘proceeds of sale’ clauses What is a retention of title (ROT) clause? At its most straightforward, a retention of title clause is a contractual term enabling the seller to keep title to goods it has supplied until the buyer has paid in full or, where permitted, resold them to a third party (Aluminium Industrie Vaassen v Romalpa Aluminium). A retention of title clause is also known as a reservation of title...