The Tánaiste and Minister for Justice and Equality, Frances Fitzgerald TD, has today signed the Bankruptcy (Amendment) Act 2015 (Commencement) (No. 2) Order 2016, bringing into force the remaining provisions of the Bankruptcy (Amendment) Act 2015.
The Tánaiste said: “This Government is committed to providing practical assistance for people indebted through no fault of their own who genuinely seek to return to solvency and to building on our recent bankruptcy and insolvency reforms
“The Bankruptcy (Amendment) Act 2015 continues the modernisation of our bankruptcy system. This latest Commencement Order 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 Act signed by the President on 25 December 2015 represented a fundamental reform of bankruptcy legislation, and included provision for a 1 year bankruptcy term. Most of the Act, those provisions not requiring changes to Rules of Court, was commenced by the Minister with effect from 29 January 2016.
The remaining sections of the Act, which this order will bring into effect, provide for the abolition of the mandatory requirement for a ‘statutory sitting’ of the Court, which must be attended by the bankrupt person, the creditors and the Official Assignee, some weeks after a debtor is adjudicated bankrupt.
ENDS
Notes for Editors
The Bankruptcy (Amendment) Act 2015 (Commencement) (No. 2) Order 2016 brings into force on 1 June 2016 those sections of the Bankruptcy (Amendment) Act 2015 which are not already in operation. These sections provide for the abolition of ‘statutory sittings’ - the requirement for an extra High Court hearing in all bankruptcy cases, which must be attended by the bankrupt person, the creditors and the Official Assignee, some weeks after a debtor is adjudicated bankrupt.
Those provisions (sections 3, 4, 5, 13 and 14) required changes to Rules of Court. The Superior Courts Rules Committee signed the relevant rules on 7 April 2016. The Minister concurred on 9 May in the Rules of Court (SI No. 232 of 2016) making the necessary Rules changes with effect from 1 June.
The Tánaiste already commenced, with effect from 29 January 2016, all the provisions of the Act that did not require changes to Rules of Court:
- 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.
Further information is available on the Bankruptcy section of the website of the Insolvency Service of Ireland (ISI) - see www.isi.gov.ie .