Cheaper and easier debt-resolution for SMEs
Enterprise Minister Richard Bruton today announced that small private companies will be able to apply directly to the Circuit Court to have an examiner appointed, in a move which will make it cheaper and easier for viable businesses to restructure their debts.
The Minister announced his intention to amend the Companies Acts to facilitate the change through a measure to be contained in the upcoming Companies Bill.
These changes will affect small private companies, meaning companies that satisfy two out of the three following conditions:
• Balance sheet not exceeding €4.4million
• Turnover not exceeding €8.8million
• Number of employees not exceeding 50
Minister Bruton said:
Small businesses employ over a third of all people working in Ireland today, and a major part of the Government’s Action Plan for Jobs is aimed at supporting the growth of this sector. We are putting in place a streamlined support service for small and micro-businesses through reforms to the CEBs and local authorities. We have put in place a range of new funding mechanisms for SMEs including the €90million microfinance scheme and the €450million credit guarantee scheme.However we must also recognise that there are many viable businesses in this sector, employing large numbers of people and with the potential to employ many more, which are facing significant difficulties because of legacy debts. That is why we committed to putting in place better structures to enable these businesses to more easily restructure their debts, while giving proper consideration to other businesses and individuals owed money by them.Today’s announcement that small companies will be able to apply to the Circuit Court for examinership will mean that it will be cheaper and easier for businesses to restructure their debts, meaning that more companies will be able to do so. This will mean that more businesses will survive their current difficulties, meaning crucially that more jobs will be saved and more jobs will be created in this hugely important part of the economy.