Bankruptcy period just confirmed to be reduced to 1 year.
The Senate Legal and Constitutional Affairs Committee have just moments ago handed down their report recommending that the bankruptcy period be reduced to 1 year from 3 years.
In what will be discussed at length (and disagreed with) by many in the insolvency profession, the only thing the Report gave some saving grace to was ASIC’s recommendation to ameliorate the risk of director’s abusing this system.
Although many in the industry raised concerns that the proposed reduction to 1 year would not meet the intended purpose (ie because most bankruptcies are personal-related, as opposed to business-related), the Senate Committee dismissed same by relying upon data from the Attorney-General’s Department.
The data alleged that 35% of all bankruptcies (in a 3 month period only) were business-related.
