Wednesday 12 April 2017

Australia: corporate insolvency law reforms

The Treasury has published an exposure draft of the Treasury Laws Amendment (2017 Enterprise Incentives No. 2) Bill 2017: see here (pdf). The purpose of the Bill is to make some significant changes to the corporate insolvency regime, including: (a) the introduction of a safe harbour regime for company directors from personal liability for insolvent trading in the context of a restructuring; and (b) making unenforceable, where a company is being restructured, 'ipso facto' clauses in contracts which permit one party to terminate or modify the contract due to an insolvency event.

Further information is available in the draft explanatory memorandum accompanying the Bill: see here (pdf).

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