Insolvency Reforms Pass Senate

by Anita Sibrits

The Senate has passed a package of insolvency reforms and the Bill is now awaiting Assent. The Corporations Amendment (Insolvency) Bill 2007 is the outcome of response to community and business concerns, and follows an extended period of consultation between Treasury, ASIC and other stakeholders including the Insolvency Practitioners Association of Australia. The Insolvency Law Advisory Group provided technical and other advice in the drafting of the legislation.

The Bill implements a raft of reforms through its six detailed schedules of amendments. It is directed to improving outcomes for creditors, deterring corporate misconduct, improving the regulatory framework for insolvency practitioners and finetuning the voluntary administration process. Among the benefits is enhanced protection for employee entitlements, through mechanism including mandatory requirements that the deed of company arrangement provides priority to employee creditors in a winding up, unless otherwise waived or varied. Various protections for investors come with the tightening of the insolvency laws.

With the Bill to come into force by early 2008, practitioners will now need to come to grips with its changes.

Wide-Ranging Changes Affect Corporations

Focusing on efficiency and improved outcomes, the Bill joins a range of other major corporate regulatory framework changes made by the Government this year. Responding to drivers like the Banks Report, the Government has introduced a series of changes affecting corporations, including those in the Corporations Legislation Amendment (Simpler Regulatory System) Act 2007. Several changes are already in force and others are soon to start.

Recognising the critical need for corporate advisers to be up-to-date, Thomson is releasing a special July Edition of its heavily-used Corporations Legislation book. This specially updated edition, current to 9 August, is essential for everyone advising corporations. In this new edition, Professor Robert Baxt comments on the developments since January 2007, providing a valuable orientation to the flow of changes this year. The legislation, including the Corporations Act 2001 and the Australian Securities and Investments Commission Act 2001 and their accompanying regulations has been updated for amendments in force now, so users can be confident of having the best version to hand. To help with changes which will start to affect business practice, this edition also included special notes for sections affected by changes yet to commence, including amendments by the Corporations Amendment (Insolvency) Bill 2007 which have just passed the Senate.

Publishing details:
Publishing August 2007, Softcover
Code: 978 0455 225 005
$69.00 incl. GST

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