It is noted that an essential element of Australia’s economic health is an efficient Insolvency System. Even though Australia has a “World Standard” Insolvency System, a number of recent reviews have highlighted areas where reform is essential.
The release of the Draft Reform is to strengthen and update Australia’s Personal Bankruptcy and Corporate Insolvency Administrations. The draft reforms aim to align, simplify and strengthen Australia’s Insolvency Framework in order to remove unnecessary costs from the Insolvency Industry.
In order to understand how the Reform package will influence the stakeholders to Corporate and Personal Insolvency Administrations, the Reform Paper details the Government’s Insolvency Practice Rules (“IPRs”) together with the amendments to the Bankruptcy and Corporations Regulations.
It is further believed that the Draft Reforms will improve outcomes for Businesses, Creditors and the Insolvency Practitioners by:-
- Improving efficiencies in Insolvency Administrations;
- Increasing competition within the market for Insolvency Services;
- Allowing stakeholders to protect their own interest in communication between Insolvency Practitioners and Creditors;
- Increasing confidence in the professionalism and competency of Insolvency Practitioners; and
- Improving the supervision of the Insolvency Industry.
The paper is divided in two parts. Part 1 sets out the changes to delegated legislation that the Government is proposing to make in the personal insolvency sphere. Part 2 sets out the changes to delegated legislation that the Government is proposing to make in the Corporate Insolvency. Stakeholders can refer to the information on the Draft Reform from The Treasury’s website – www.treasury.gov.au. The Insolvency Law Reform Bill 2014 is listed under ‘Latest Consultations’ on the homepage.