Liquidations may pick up with tapering of Covid support moves

THE pandemic years have not seen a rise in businesses filing for liquidation, according to figures compiled by data platform Handshakes – though corporate lawyers see a chance that filings might pick up as government support dissipates and economic conditions remain gloomy.

Instead, the total number of companies and limited liability partnerships filing for liquidation fell slightly in the last 2 years. The figures were 950 in 2021 and 924 in 2020, compared to pre-pandemic figures of 1,029 in 2019 and 964 in 2018. This year, 497 business entities have filed applications for liquidation as of June.

Temporary relief measures and government financial support during the pandemic may have delayed the commencement of winding up applications, said lawyers. Such measures included grants, loan payment deferrals, loan restructuring assistance and moratoriums on presentation of winding up petitioners.