Operators struggling to meet financial standing can now be offered a period of grace of up to a year to get themselves on a firmer footing, according to transport lawyers.

Laura Hadzik, solicitor at Backhouse Jones, said the maximum period had been extended by six months to 12 months “for assessments of inadequate finance made between 1 March and 30 September 2020".

She added: “We don’t have any further details yet, it only came through last night [4 June] but we do understand that the senior traffic commissioner will be updating the statutory documents to provide further guidance on this in due course.”

Current guidance for operators on financial standing states: “Where a standard licence holder cannot demonstrate financial standing Regulation (EC) 1071/2009 allows but does not require the traffic commissioner to provide a period of time to rectify the situation.

“The operator may be given a limited time to make written representations before the traffic commissioner decides whether to allow time for rectification and for what period by way of a notice served under the legislation.”

James Backhouse, director at Backhouse Jones said: “The obligation to meet financial standing is mandatory so it’s important that if for any reason you can’t, you work up the strategy for meeting it, you notify the traffic commissioner of the position and you request a period of grace, which has been indicated may well now be authorised for up to 12 months when the EU legislation currently limits it to six months.

“There must have been a derogation to allow us to move it out to 12 months, or maybe they are taking advantage of the fact we are leaving the EU in December,” he added.

The office of the traffic commissioner did not respond as we went to press.