11 May 2004

A draft Insolvency Law Reform Bill has been released for public consultation with the due date for submissions 11 June 2004.

Two of the main features of the proposed Bill are:

• introducing a voluntary administration procedure for companies that can be rehabilitated (the procedure would be closely modelled on Australias voluntary administration regime); and
• a new no-asset procedure (this reflects a concern that some of the harsher restrictions of bankruptcy are not appropriate for individuals that have few or no assets and may have become insolvent through no fault of their own).

The Government is also releasing a public discussion document seeking feedback on two remaining policy issues - regulating insolvency practitioners and the priority of employee entitlements to wages in lieu of notice.

The draft Bill & discussion paper are available from www.med.govt.nz.

Source: MAF Rural Bulletin May 2004