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The Consolidated Appropriation Act of 2021 (“CAA”) enacted on December 27, 2020 bolsters the bankruptcy relief available to small businesses in several key ways. In June 2020, we outlined here ways in which the Small Business Restructuring Act of 2020 (“SBRA”) offered small businesses having aggregate debts up to $7.5 million a less costly and more streamlined alternative to restructuring under chapter 11 of the United States Bankruptcy Code. The CAA furthers those benefits in several important ways for two years until December 27, 2022:
PPP Loan Eligibility: After the passage of the CARES Act in March 2020, the Small Business Administration and several bankruptcy courts rejected efforts by small business debtors from receiving loans under the Paycheck Protection Program (“PPP”) administered by the Small Business Administration. The CAA remedies that issue by amending section 364 of the Bankruptcy Code t