The Minister for Justice and Equality, Frances Fitzgerald TD, has signed an order bringing into force today - Friday, 29 January - most of the provisions of the Bankruptcy (Amendment) Act 2015, including the reduced bankruptcy term of 1 year.
The Bankruptcy (Amendment) Act 2015 (Commencement) Order 2016 commences provisions:
- reducing the normal duration of bankruptcy from 3 years to 1 year,
- reducing the normal duration of a Bankruptcy Payment Order (the payments a Court may direct the bankrupt person to make towards their creditors) from 5 years to 3 years,
- providing for the bankrupt person’s ownership in their home to “re-vest” in them after 3 years (in normal course) if the Official Assignee has not applied to Court for its sale,
- allowing the High Court to extend the bankruptcy term to up to 15 years, where it is satisfied that there has been particularly serious non-co-operation or concealment,
- enabling the Official Assignee to disclaim onerous properties, which would impose net costs on the taxpayer,
- ensuring that the Official Assignee has clear powers to demand and investigate electronic records relating to a bankrupt’s assets and affairs, and
- providing transitional arrangements, so that people already in bankruptcy will also get the benefit of these reforms, subject at maximum to a six month transitional period.
Minister Fitzgerald said: ‘I am very pleased to commence the provisions of the Bankruptcy (Amendment) Act 2015. The Act is a significant reform of our bankruptcy laws and reflects a fundamental shift in attitudes towards indebtedness. Our legislation no longer punishes people who, in most cases, through no fault of their own find themselves with intractable debt.
However, bankruptcy is still not going to be an easy option. People seeking bankruptcy will have to co-operate in an open manner with the bankruptcy process, and hand over their income and assets towards repayment of their debts.
The new Act also further modernises our bankruptcy system: it will remove unnecessary costs and delays for debtors and creditors, free up court time and resources, and allow more efficient and effective bankruptcy administration.’
The Minister added: ‘The legislation is only one of a number of measures which this Government has taken since 2012 to support and give hope to people in genuine financial distress. Those measures have been tailored to give people a fresh start and return to normal economic activity, much more quickly. This is good for them, and good for our economy.’
ENDS...//
Note to Editors
The Bankruptcy (Amendment) Act 2015 was signed by the President on 25 December 2015 and amends the Bankruptcy Act 1988.
The Commencement Order, Bankruptcy (Amendment) Act 2015 (Commencement) Order 2016 signed by the Minister today brings into effect most of the Act’s provisions. The provisions dealing with the abolition of the requirement for a statutory sitting of the High Court in bankruptcy cases (sections 3, 4, 5, 13 and 14) require changes to Court Rules. These changes are well advanced and will be the subject of a later commencement order.