Submission | Improving Bankruptcy and Insolvency Laws Proposals Paper

The Australian Chamber of Commerce and Industry welcomes the opportunity to provide a submission to the Australian Government’s Proposals Paper Improving bankruptcy and insolvency laws.

The proposals are to:

• Reduce the current default bankruptcy period to one year.
• Introduce a ‘safe harbour’ for directors from personal liability for insolvent trading if they appoint a restructuring adviser.
• Make ‘ipso facto’ clauses unenforceable if a company is undertaking a restructure.

Taken together, they have the potential to strike a better balance between encouraging entrepreneurship and protecting creditors.