On 15 December 2011 the Parliamentary Secretary to the Treasurer announced amendments to personal and corporate insolvency laws.
The amendments address a wide range of issues that have had a negative impact on the efficiency and effectiveness of the insolvency system. The regulation of insolvency practitioners has been the subject of a number of reviews. The Senate Economics References Committee inquiry The regulation, registration and remuneration of insolvency practitioners in Australia: the case for a new framework (September 2010) was critical of a number of areas of the current regulatory framework for corporate insolvency, including the current registration and discipline frameworks, insurance obligations, and remuneration of registered liquidators.
The Regulation Impact Statement (RIS) sets out three options for possible reforms to the corporate and personal insolvency systems. The first option was to retain the status quo while the second option involved reforming the registration, deregistration and oversight of the insolvency profession by establishing a new co-regulatory system. Under the third (preferred) option, reforms would be made to align and enhance the regulatory frameworks that apply to the regulation of registered liquidators and registered trustees, and the governance of corporate and personal insolvency administration. These reforms would be adopted into the current respective legislative vehicles.
The proposals are subject to further consultation before their implementation through amendments to relevant legislation. A supplementary Regulation Impact Statement will be prepared where the consultation results in substantive changes to the proposals.
The RIS was prepared by the Treasury and has been assessed as adequate by the Office of Best Practice Regulation.
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