Director Disqualifications In 2022

Director disqualification in respect of dissolved companies is not a new principle (in fact the key piece of legislation has been in force since 1986), but in 2022 there is certainly a greater risk of it arising as a result of the enactment of new legislation, the Rating (Coronavirus) and Director Disqualification (Dissolved Companies) Act 2021 (the Act).

The new act means that both directors and former directors of solvent companies that were dissolved are now at risk of disqualification. Previous legislation only covered insolvent companies.

This article summarises where this risk may arise, but if anything is learned, it is that directors should: (i) seek advice from a solicitor and an insolvency practitioner before proceeding with any insolvency procedure; and (ii) seek advice to ensure compliance with their directors' duties at all times.