Perkins Coie

Subscribe to Perkins Coie's Posts

By Andrew Smetana, Wendy Moore, and Sean Apfelbaum

In its latest interim final rule (IFR #24) providing guidance under the Paycheck Protection Program (PPP), the Small Business Administration (SBA) provided clarification on two topics impacting borrowers that are preparing to apply for loan forgiveness and, in doing so, created new limitations on PPP loan forgiveness. A summary of this latest guidance follows.

Compensation Limits for Owner-Employees

The new guidance will help some small business owner-employees understand when their compensation is subject to special limits with respect to PPP loan forgiveness. As discussed in our prior client alert (see here), the SBA announced through FAQs that special limits apply with respect to loan forgiveness for loan proceeds used to pay compensation to owner-employees. These owner-employee restrictions impose both a lower cash compensation limit on owner-employees of borrowers who use the 24-week “covered period” for PPP loan forgiveness and certain categorical restrictions that differ from the treatment for ordinary employees. However, prior guidance did not specify any ownership threshold for these compensation limits, allowing speculation as to whether these limits would apply to any business owner, only owners of more than 20% of the business, or some other category of business owners. The new guidance provides as follows:

By KoKo Huang and Gregory McCall

On August 12, 2020, the U.S. Department of State released implementation guidance related to two recent presidential proclamations restricting visa issuance and travel for foreign workers. (Presidential Proclamation 10014 and Presidential Proclamation 10052). In implementing these proclamations, the Department of State, in conjunction with the Department of Homeland Security, released guidance related to national interest exceptions set out in the presidential proclamations.

Businesswoman Signing Cheque

By Andrew (Andy) Smetana, Teri A. Lindquist, Joe Bailey, and Wendy L. Moore,

While debates in Congress continue regarding extending or providing additional COVID-19 relief legislation, the Small Business Administration (SBA), U.S. Department of Treasury (Treasury), and lenders under the Paycheck Protection Program (PPP) are preparing for the next wave of activity for PPP loans. Specifically, the deadline to obtain a PPP loan is tomorrow, August 8, 2020. In addition, other key milestones related to PPP loan forgiveness are rapidly approaching. The SBA previously announced that it intends to make an electronic portal available on August 10, 2020 to begin processing PPP loan forgiveness applications, and on August 4, 2020 the SBA and Treasury released new FAQs regarding loan forgiveness. The new FAQs largely reiterate prior guidance but include some clarifications that may impact borrowers’ applications for loan forgiveness. Highlights of these developments and key reminders regarding the loan forgiveness process are provided below.

By KoKo Huang and Gregory McCall

The Trump administration has implemented numerous immigration proposals via executive order in response to the COVID-19 pandemic. To date, President Trump has signed the following immigration-related executive orders, all which are currently in effect:

  • On January 31, 2020, a proclamation barring individuals from China from entering the United States.
  • On February 29, 2020, a proclamation suspending entry of individuals from Iran into the United States.
  • On March 11, 2020, a proclamation suspending entry of individuals from the Schengen Area (Austria, Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, the Netherlands, Norway, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, and Switzerland) into the United States.
  • On March 14, 2020, a proclamation suspending entry of individuals from the UK and Ireland into the United States.
  • On April 22, 2020, another presidential proclamation limiting immigration for individuals outside of the United States seeking U.S. permanent residency. Please see our summary of this proclamation.
  • On May 24, 2020, a proclamation barring individuals from Brazil from entering the United States.
  • On May 29, 2020, a proclamation restricting the entry of certain Chinese national students and researchers into the United States pursuant to their visas to study or conduct research in the United States. Please see our summary of this proclamation.
  • On June 22, 2020, a proclamation temporarily barring certain non-immigrants who were outside of the United States and without valid nonimmigrant visas as of June 24 from entering the United States. Please see our summary of the proclamation.

By Jim Davis, Norton Cutler, and Bradley Dlatt

The insurance industry in the United States continues to thwart legislative solutions for disputed COVID-19-related losses under property/business interruption policies and resists efforts to group lawsuits together into multi-district federal litigation or class actions. Meanwhile, the independent regulator of insurers in the United Kingdom, the Financial Conduct Authority (FCA), is trying to take a more organized and direct approach. Although the FCA indicated that it did not believe coverage existed for most claims for COVID-19-related losses, the FCA has identified the key language at issue in the various insurance policies, the universal or prevalent facts presented, and the legal questions posed. The regulator has announced an initiative to begin resolving these disputed claims by bringing a series of test cases in U.K. courts to answer these coverage questions. Though the test cases are being resolved under the law of the United Kingdom, the outcomes are likely to influence American courts that are grappling with many of the same issues under similar insurance policy language. Depending on the success of the test cases in streamlining these disputes in the U.K., U.S. policyholders may want to consider adopting a similar approach to fast-track their claims towards settlement.