|Date of effect||1 July 2020|
The Government has announced that it will further streamline insolvency laws:
- Review of trusts – Review how trusts (a common vehicle for SME businesses) are treated under insolvency laws.
- Review future of safe harbour trading provisions – introduced in 2017, the safe harbour trading provisions provided breathing space for distressed businesses to trade out of debt. These rules will be reviewed to determine if they remain fit for purpose.
- Review of schemes of arrangement – introduction of a moratorium on creditor enforcement while schemes are being negotiated.
- Increase in statutory demand threshold – the threshold at which creditors can issue a statutory demand on a company will increase from $2,000 to $4,000.