A critical analysis of legal notice 373 of 2020 and its effects on company law

Abstract

The covid-19 pandemic has given rise to an unprecedented rise in global economic instability resulting in an abundance of companies facing financial difficulties. As a response to this, the Maltese legislator has chosen to address the corporate distress arising out of the pandemic by introducing emergency measures in the form of primary legislation. This dissertation will primarily focus on Legal Notice 373 of 2020 titled ‘The Companies Act (Suspension of Filing for Dissolution and Winding Up) Regulations’. The raison d'être of this Legal Notice is easing Maltese Insolvency law intending to prevent forceful creditor action against the financially distressed company. It shall attempt to critically analyse such Legal Notice whilst focusing on an ex ante approach. In this respect, the author aims to take an evaluative and analytical standpoint whereby the consequences of this Legal Notice on affected parties shall be discussed. This shall be done whilst bearing in mind the Maltese culture of insolvency which at the moment is rather creditor friendly. Continual reference shall be made to court judgements which have been able to dissect the scope of the Legal Notice and apply it as procedural law. Moreover, a comparative analysis based on the United Kingdom will be carried out. The aim is to shed light on the analogous approaches taken in both jurisdictions. This dissertation also includes several recommendations concerning the applicability and adaptability of the Legal Notice. Through this, the existent shortcomings have been brought to light and will be addressed in an effort to examine in what ways it could have been better implemented to reap the finest result.