How did insolvency laws in Australia change in response to the Covid-19 Pandemic?
The onset of the Covid-19 pandemic meant many businesses faced an overwhelming change in circumstances, causing a tidal wave of personal insolvency and bankruptcy claims. Many individuals were in very difficult situations and something had to be done.
The Australian government introduced many measures to assist small businesses and individuals through this difficult time of financial uncertainty.
- Job Keeper and Job Seeker were established
- Generous small business support grants were launched
- And most importantly there were Insolvency and bankruptcy law reforms to support the drastic change in circumstances and increased number of people experiencing hardship
Insolvency Laws Melbourne, Queensland, Perth, Sydney and Adelaide
Many of these measures came to an end in 2020, but some insolvency laws in Melbourne have become permanent as well as in other states and territories such as Queensland, Perth, Sydney and Adelaide, to assist small businesses into the future.
Some key insolvency law reforms that have become permanent include simplified processes for liquidation, a new debt restructuring process and changes to the licensing of liquidators, and new restructuring laws that give small business owners at risk of insolvency a faster and easier way to streamline their debts. Allowing them a better chance of keeping the business.
With reforms to conventional liquidation processes, businesses with less than 1 million dollars of debt can now utilise a more simplified process that can save investigative time, expenses and procedures with more relaxed requirements for practitioners.
With the updated reforms, licensing requirements for insolvency practitioners and liquidators have been eased to allow faster and more simplified winding down processes. Alleviating significant workload and stress for people facing insolvencies and their practitioners.
For more information about insolvency law reforms to support small businesses, visit pipa.net.au.