As a result of the Covid 19 Pandemic the Business Law Committee has been requested by practitioners to raise awareness of useful tools / checklists that may be used in common business transactions to facilitate businesses continuing day to day operations and indeed acquiring or disposing of businesses.

The Annual Business Law conference in November 2020 already addressed areas of particular concern for practitioners, including:

1. the Company law update on interim measures introduced by the Companies (Miscellaneous Provisions) (Covid 19) Act 2020;
2. the execution of documents virtually using electronic signatures;
3. competition law enforcement in the Covid 19 era; and
4. the impact of Covid 19 on contractual obligations.

As a follow on to item (4) above, the Business Law Committee has been requested to raise awareness for practitioners of areas of additional due diligence and warranties that should be considered in light of Covid 19.

The areas outlined below are not intended to be all encompassing but are merely a flavour of some areas practitioners are commonly seeking to address in due diligence questionnaires and in warranties/indemnities, not just in share/ asset sales but in general commercial agreements.

Common examples of some areas that practitioners might consider raising specific questions on  in light of the Covid 19 Pandemic are:

• Banking – has the business availed of any loans, grants or government support in connection with Covid 19 or requested / obtained moratoriums or defaulted on loans? Has the impact of Covid-19, or the target company’s response to Covid-19, triggered any default (or events of default) or notification requirements in the target company’s existing facility agreements?
• Contracts- has any contract, transaction or arrangement been terminated or discharged by frustration or suspended or varied due to Covid 19?
• General business relations – what impact has Covid 19 had on the businesses’ dealings with third parties, including customers, suppliers, creditors and debtors?
• Health and safety – have all government guidelines and laws been implemented?
• Employment – have all employees and service providers complied with health and safety obligations under statute, common law and any applicable guidance? Have there been any layoffs or any changes in working arrangements due to Covid 19? Were any subsidy schemes availed of? Has there been any salary/pay reductions? What other alterations occurred in relation to the employees / contractors arrangements due to Covid 19? How many employees are working remotely and what impact if any has this had on the business?
• Information technology / GDPR – what measures have been taken to move the business online? What are the remote working arrangements?  What additional security and GDPR measures have been put in place to facilitate remote working arrangements? In light of Covid-19 have any changes been made to existing disaster recovery plans?
• Covid 19: What number of cases have been confirmed amongst staff? Are there any suspected cases pending results? Have any claims been made or are any claims pending?
• Insurance: Are there any policies subject to special or unusual restrictions? Have premiums increased due to Covid 19? Have any claims been made to insurers for business interruption ?Have there been any claims against the business or notifications to insurers?
• Property: Have any rates holidays/ waivers been availed of ? Are any rent reductions or payment breaks in place or non-payment of rent? What is the position on service changes?
• Tax: seek full details of all government measures availed of to assist businesses in response to Covid 19 for example TWSS.Have all returns been made on time? Has there been any warehousing of tax?

In summary it is essential to bear in mind that when the pandemic is over there will be a look back,  this may have a knock-on effect on all businesses for liabilities incurred or clawbacks of government schemes which were entered into at the time. Therefore, it is particularly important to consider the areas above today and going forward. Remember this is  merely a high level overview of certain areas and each set of circumstances need to be considered in tandem with the business owners and their other advisers in addition to any standard due diligence questions and warranties that may be sought.