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Liquidity Measures
Reliefs
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Changes to Laws

Liquidity Measures

Coronavirus Large Business Interruption Loan Scheme (CLBILS)

Government Measure
  • Eligible business may apply for loans, overdrafts, invoice finance and asset finance facilities:
    • businesses with turnover between £45m and £250m can borrow up to £25m
    • businesses with turnover in excess of £250m can borrow up to £50m
    • larger businesses can borrow up to 25% of annual turnover, up to a maximum of £200m
  • UK Government guarantees 80% of all loans
  • Standard commercial terms and interest rate applied to the loans (no repayment holiday offered).
  • Terms three months to three years.
  • Collateral and guarantees decided on a case by case basis, but note that the Government guarantee sits behind the borrower, and the primary recourse for the lender remains against the borrower itself (i.e. the 80% government guarantee applies once the lender has exhausted recovery options against the borrower, including personal guarantees and collateral, excluding primary residence).
 
Eligibility

UK-based large businesses operating in any sector (excluding credit institutions, insurers, reinsurers, building societies, public sector bodies, further-education establishments (if grant funded) and state-funded primary and secondary schools).

Applicants requesting CLBILS guaranteed loans must not have used (or intend to use) the Bank of England's Covid Corporate Financing Facility (CCFF) (additional details below).

Any companies which are backed by a private equity sponsor will be treated as a separate company for the purposes of assessing turnover and will be eligible for a separate loan under the CLBILS (even where the sponsor has a majority stake).

Companies borrowing more than £50m under the CLBILs will be imposed restrictions on paying dividends and executive remuneration.

For more information about eligibility please see this link.

 
Supervising Authority

The British Business Bank.

Financing made available through accredited third party lenders.

Applications to be made directly to the accredited lender.

 
Availability

From 20 April 2020 until at least 20 October 2020

Coronavirus Business Interruption Loan Scheme (CBILS)

Government Measure
  • Eligible business may apply for loans, overdrafts, invoice finance and asset finance facilities with a value of up to £5  million
  • UK Government guarantees 80% of all loans
  • No interest or product fees in the first 12 months of the term
  • Finance terms of up to six years for term loans and asset finance facilities, and up to three years for overdrafts and invoice finance facilities
  • Collateral and guarantees decided on a case by case basis, but note that the Government guarantee sits behind the borrower, and the primary recourse for the lender remains against the borrower itself (i.e. the 80% government guarantee applies once the lender has exhausted recovery options against the borrower, including personal guarantees and collateral, excluding primary residence).
 
Eligibility

UK based SMEs:

  • which have a turnover of no more than £45 million per 
  • operating in any sector (excluding credit institutions, insurers, reinsurers, building societies, public sector bodies, further-education establishments (if grant funded) and state-funded primary and secondary schools)

Any companies which are backed by a private equity sponsor will be treated as a separate company for the purposes of assessing turnover and will be eligible for a separate loan under the CBILS (even where the sponsor has a majority stake).

For more information about eligibility please see this link.

 
Supervising Authority

The British Business Bank.

Financing made available through accredited third party lenders (including many high street lenders).

Applications to be made directly to the accredited lender.

 
Availability

From w/c 23 March 2020

COVID Corporate Financing Facility

Government Measure
  • Eligible companies can sell commercial paper to a Bank of England vehicle (both existing and newly issued commercial paper)
  • Maturity of the commercial paper must be between one week to 12 months and issued directly into Euroclear and/or Clearstream.
  • The commercial paper itself, were available, must have a credit rating of A-3 / P-3 / F-3 / R3 from at least one of Standard & Poor’s, Moody’s, Fitch and DBRS Morningstar as at 1 March 2020.
  • Commercial paper with non-standard features such as extendibility or subordination, will not be accepted.
 
Eligibility

Companies which:

  • have a genuine business in the UK (including those with foreign incorporated parents) and make a material contribution1 to the UK economy
  • had, before being affected by the consequences of COVID-19, been in “sound financial health”, which can be demonstrated through a minimum short term credit rating of A3/P3/F3/R3 or above, or a long-term rating of BBB-/Baa3/BBB-/BBB low or above from at least one of S&P, Moody's, Fitch and DBRS Morningstar as at 1 March 2020
  • are not banks, building societies, insurance companies and other financial sector entities regulated by the Bank of England or the Financial Conduct Authority are not eligible to participate in the scheme.

Note also that leveraged investment vehicles, companies within groups that are predominantly banks, investment banks or building societies, are not legible for this measure.

Companies participating in this scheme will be imposed restrictions on paying dividends and executive remuneration.

1Guidance from the Bank of England provides that firms which meet this requirement would usually be: UK incorporated companies with significant business in the UK (including those businesses with foreign parents); companies with significant numbers of employees in the UK; businesses headquartered in the UK; businesses which either derive material revenues from the UK, serve a large number of customers in the UK, or have a number of operating sites in the UK.

 
Supervising Authority

Bank of England

Applications for the scheme can made by companies here.

Banks seeking to issue commercial paper on behalf on their clients should contact the Bank of England.

 
Availability

From 23 March 2020 until at least 23 March 2021

Future Fund

Government Measure
  • Eligible investors may apply to the British Business Bank to secure funding for eligible companies impacted by the coronavirus
  • The Future Fund will match up to 100% of the amount provided by investors, up to a maximum of £5m
  • Loans will accrue interest at a rate of at least 8% per annum
  • Loans are convertible to equity in certain circumstances, including on an exit or subsequent funding round
 
Eligibility

Eligible investors include certain:

  • professional investors
  • sophisticated investors
  • high net worth individuals

For a company to be eligible for funding from the Future Fund it must:

  • have raised at least £250k in equity from third-party investors in previous funding rounds in the last five years
  • be the ultimate parent company of any corporate group of which it is a member
  • not have any listed shares in issue
  • be a UK incorporated limited company incorporated on or before 31 December  2019
  • have half or more of its employees based in the UK or derive half or more of its revenues from sales in the UK

For more information about eligibility please see this link.

Supervising Authority

The British Business Bank.

 
Availability

Until end of September 2020

Bounce Bank Loan Scheme (BBLS)

Government Measure
  • Eligible business may apply for loans ranging in value from £2k to 25% of turnover, up to a maximum amount of £50k
  • UK Government guarantees 100% of all loans
  • The loans accrue interest at 2.5% per annum
  • Interest payments for first 12 months of the term are paid by the UK Government
  • Finance terms of up to six years with early repayment permitted, without early repayment fees
 
Eligibility

UK-based businesses operating in any sector (excluding credit institutions, insurance companies, public sector organisations and state-funded primary and secondary schools) which are experiencing financial difficulty as a result of the coronavirus.

Applicants requesting BBLS guaranteed loans must not have used (or intend to use) the CLBILS, the CBILS or the CCFF (additional details above).

For more information about eligibility please see this link.

 
Supervising Authority

The British Business Bank.

Financing made available through accredited third party lenders (including many high street lenders).

Applications to be made directly to the accredited lender.

 
Availability

Until at least 4 November 2020

Retail and Hospitality Grant Scheme

Government Measure

Local authority grants to eligible businesses in the retail, hospitality or leisure sectors

 
Eligibility

Businesses based in England operating in the retail, hospitality or leisure sectors (e.g. shops, restaurants, cafes, bars, cinemas, concert venues and hotels):

  • with a property that has a rateable value of less than £15,000 will receive a one-off grant of £10,000
  • with a property with a rateable value of between £15,000 and £51,000 will receive a one-off grant of £25,000
 
Supervising Authority

The UK Government and local authorities. No action is required on behalf of eligible businesses who will be contacted directly by their local authority if they are eligible.

Further guidance about the scheme is available here.

Applications to be made directly to the accredited lender.

 
Availability

From 11 March 2020

Grant Funding for Small Businesses

Government Measure

Local authorities to make a one-off £10,000 grant to qualifying businesses

 
Eligibility

Businesses based in England occupying a property with a rateable value of less than £15,000

 
Supervising Authority

The UK Government and local authorities. No action is required on behalf of eligible businesses who will be contacted directly by their local authority if they are eligible.

 
Availability

From 11 March 2020

Deferred VAT Payments

Government Measure
  • From 20 March 2020 to 30 June 2020 all VAT payments will be deferred
  • All businesses in the UK will be given until the end of the 2020/21 tax year to pay any VAT liabilities accumulated during the deferral period
 
Eligibility

All businesses registered for VAT in the UK

Automatic offer with no applications required.

 
Supervising Authority

Her Majesty’s Revenue and Customs (“HMRC”)

 
Availability

Deferral period runs from 20 March 2020 until 30 June 2020, with businesses offered payment relief for VAT accrued in the deferral period until 5 April 2021

HMRC Time to Pay Scheme

Government Measure

Relaxation of existing rules on payment of tax in the UK

 
Eligibility

UK companies which are unable to pay outstanding tax liabilities as a result of the COVID-19 outbreak. Arrangements agreed by the business with HMRC on a case by case basis.

 
Supervising Authority

HMRC

Helpline: +44 (0)800 0159 559

 
Availability

Ongoing with no set end date

Reliefs

Job Retention Scheme

Government Measure
  • Employers to designate certain of their employees as "furloughed employees"
  • HMRC will reimburse 80% of furloughed employees’ wage costs up to a cap of £2,500 per month
  • Employers have the option to top-up the government's scheme with the remaining 20% of their furloughed employees' salaries should they wish to do so
 
Eligibility

Businesses with employees in the UK operating PAYE

 
Supervising Authority

HMRC

Reimbursement system currently in development, details of which to be announced shortly.

 
Availability

Three months from 1 March 2020.

May be extended as necessary

Statutory Sick Pay Relief

Government Measure
  • Eligible employers can reclaim up to 2 weeks statutory sick pay (SSP) per employee who is off work as a result of Covid-19, whether through illness or self-isolation
  • Statutory sick pay is currently £94.25 per week, rising to £92.85 per week from 6 April 2020
 
Eligibility

UK businesses which employed fewer than 250 employees as at 28 February 2020 (SMEs)

 
Supervising Authority

HMRC

Reimbursement system currently in development, details of which to be announced shortly.

 
Availability

From 13 March 2020

Business Rates Relief

Government Measure

12-month business rates holiday for 2020/2021 tax year for all retail, hospitality, leisure and nursery businesses in England

 
Eligibility

Businesses based in England in the retail, hospitality and/or leisure sector.

Automatic offer with no applications required.

 
Supervising Authority

HMRC

 
Availability

2020/2021 tax year

Extension Period to File Annual Accounts

Government Measure

Businesses in the UK affected by COVID-19 will be given a three month extension to file their annual accounts at Companies House, the registrar of companies in the UK.

 
Eligibility

All businesses in the UK are eligible to apply for an extension, provided the deadline for filing their annual accounts has not yet passed.

 
Supervising Authority

Companies House

Further guidance is available here.

 
Availability

From 25 March 2020 to 25 June 2020

Other

Protection of eviction from non-payment of rent

Government Measure

No right of forfeiture for non-payment of rent under a business tenancy until 30 June  2020

 
Eligibility

All business tenants in England and Wales and Northern Ireland

 
Supervising Authority

To be enacted as a statute under emergency coronavirus legislation.

 
Availability

From passing of emergency coronavirus legislation until 30 June 2020 (or later if extended)

Changes to Laws

New Corporate Insolvency and Governance Legislation

Government Measure

In response to the COVID-19 pandemic, the UK Government has accelerated the publication of a new Corporate Insolvency and Governance Bill to implement reforms to UK insolvency laws first announced in May 2016, which will include:

  • temporary suspension of "wrongful trading" rules (under which company directors may be held personally liable for failing to take every step to minimise losses to creditors once there is no reasonable prospect of their company avoiding insolvency) to be applied retrospectively from 1 March 2020 to 30 June 2020
  • temporary moratorium for companies giving them "breathing space" to consider restructuring options
  • protection of supplies to enable businesses to trade during the moratorium
  • ability to bind dissenting stakeholders to a new restructuring plan
 
Eligibility

The UK Government's new legislation will apply to all companies in the UK.

 
Supervising Authority

The UK Government

A draft of the Corporate Insolvency and Governance Bill was published on 20 May 2020 and is available here.

 
Availability

From passing of applicable legislation.

Amendments to the Enterprise Act 2002

Government Measure

The UK Government has introduced amendments to the Enterprise Act 2002 which will give it additional powers to scrutinise and intervene in certain foreign takeover transactions involving:

  • businesses which are directly involved in the UK's pandemic response, or
  • businesses operating in the following sectors deemed central to national security: artificial intelligence, cryptographic authentication technology, and advanced materials.
 
Eligibility

The UK Government's new legislation will apply to all companies in the UK.

 
Supervising Authority

The UK Government

Further information about the amendments to the Enterprise Act 2002 is available here.

 
Availability

From 22 June 2020