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ARTICLE · 29 JANUARY 2021

Small business insolvency reforms

Carter Newell
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These amendments, with proposed new regulations, will implement a new Small Business Restructuring Process.

AustraliaInsolvency/Bankruptcy/Re-Structuring
Andrew Shute
Andrew Shute
Sarah Ewing
Sarah Ewing
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Appropriately branded as the 'most significant reforms to Australia's insolvency framework in 30 years' the Corporations Amendment (Corporate Insolvency Reforms) Bill was introduced to Parliament on 12 November 2020, following public consultation in October 2020 and passed both houses on 10 December 2020.

The amendments to the Corporations Act 2001 (and consequential acts) implemented by the Bill, together with proposed new regulations, will:

  1. be effective from 1 January 2021;
  2. implement a new Small Business Restructuring Process (likened to the US Chapter 11 process), by which eligible small companies may restructure their debts with the assistance of a Small Business Restructuring Practitioner, but without the appointment of an external administrator or liquidator; and

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