Who should pay for the costs of the administration of an insolvency?

A debtor in Australia pays no fee to have themselves made voluntarily bankrupt. If that does not seem odd, then it should be further explained that we are one of the only jurisdictions to impose no fee. But the ‘fee’ to wind up the debtor’s company can be a few thousand dollars. Individual debtors In […]

New Zealand’s COVID-19 laws on reckless trading and debt hibernation

The COVID-19 Response (Further Management Measures) Legislation Bill has been introduced into the New Zealand parliament is now before the Epidemic Response Committee. It is broadly equivalent to the Omnibus Act 2020 in Australia. RITANZ offers useful comments on the Bill. Safe harbour It provides a safe harbour for s 135 – reckless trading – […]

Further Covid-19 Restructuring Survey Results – Australia

In my post of 3 May 2020, I reported on various surveys both during the COVID-19 crisis, and before. One that was then pending was from KordaMentha Corporate and TMA which surveyed more than 300 corporate renewal professionals, lawyers and lenders. Their survey results are now out –  View the results. – and some responses […]

Australia’s temporary personal debt protection

One of the ‘COVID-19’ bankruptcy reforms made in Australia on 25 March 2020 was to extend the period of a stay of creditor claims against a debtor from 21 days to six months, termed a temporary debt protection.[1] Importantly, a debtor commits an act of bankruptcy when they access this protection.[2]  The fact of the […]

Some thinking about insolvency pre-packs, panels and more

In a newspaper article of 20 April 2020* promoting a new ‘restructuring business’, some ‘new thinking’ is offered on changes needed to meet what is said to be an expected ‘insolvency deluge’. The thinking, in relation to pre-packaged insolvencies and an insolvency panel, is not new but it usefully adds to the list of reforms […]

Reform of insolvency communications by email, and beyond

Corporate insolvency law in Australia concerning communications with creditors needs modernising, and well beyond what is available in 2020.  When early cars, then termed locomotives, were first allowed on the road England’s ‘Red Flag Act’ of 1865 required a man with a red flag to walk ‘60 yards’ ahead to alert ‘the Riders and Drivers […]

ARITA’s ‘bushfire and COVID-19’ request to government for funding

ARITA – the main Australian industry body representing insolvency practitioners and lawyers – has asked the government[1] for funding to enable it to address various issues in corporate insolvency highlighted by the current crisis. ARITA raises aspects of long held concerns[2] of myself and Professor Jason Harris which we raised again this week, our views […]

Managing the insolvency curve – a new government role is needed?

There is expected to be a wave of businesses and individuals going into liquidation or bankruptcy despite the huge financial measures being taken by the government. These insolvencies will occur despite the recent measures limiting the rights of creditors to bring insolvency proceedings, and despite the additional safe harbour protection from insolvent trading for company […]

Just when we have some creditor activism in insolvencies …

Will the current extreme crisis we confront finally stir insolvency creditor activism, but in the wrong way? or further dampen it? Just as the drum continued to be beaten on the problem of creditor disengagement in insolvencies and an article appears offering glimmers of creditor activism arising, the government has responded to the extreme economic […]

Changes to Australia’s insolvency laws – some different perspectives

The recent changes to Australia’s insolvency laws are being well explained by the experts. These are some comments from me both on the changes and on some gaps. The changes to Australia’s insolvency laws are well explained elsewhere – the extended declarations of intention; the new $20,000 threshold for bankruptcy petitions; and $20,000 thresholds for […]