Moorfields support proposed changes to the Enterprise and Regulatory Reform Act (ERRA)
Ben Stanyon, Senior Manager, at Moorfields Corporate Recovery Limited, comments on the proposed changes to the Enterprise and Regulatory Reform Act (“ERRA”).
“The cornerstone of many a modern business is its IT infrastructure. Reliance on websites as a portal to customers and, often, as a point of sale can be critical in terms of a business’s survival. The proposed change to the ERRA to bring IT services into the list of “essential services” to businesses is, therefore, welcomed by Moorfields.
At present, insolvent companies have the benefit of continuance of supply from utility providers, which enables the “lights to remain on” and the “phones ringing”, whilst Insolvency Practitioners explore a potential rescue of a business. All too often, however, IT services have been the focal point of the business and continuance of services by hosting agents, providers and servicers, who are often in arrears, can place a strain on the business in terms and ransoms being payable on Day 1 of an Administration. In addition, a business’s IT can often carry intangible value which can be sold for the benefit of creditors.
Our view, in short, is that the proposed reforms promote the rescue culture and will enhance the possibility of saving jobs and increasing value for creditors.”
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