The Bankruptcy Amendment (Debt Agreement Reform) Bill 2018 commenced on 27 June 2019. This debt agreement law reform aims to enhance accessibility so that the debt agreement system is a fairer system for both debtors and creditors. It also aims to protect the financially vulnerable from potentially being exploited.
There are various features of debt agreements that will be changed, including:
- The length that a debtor can propose for a debt agreement
- The criteria to enter into a debt agreement
- The voting rules for creditors
- The registration requirements for debt agreement administrators
- The investigative and inquiry powers of the Inspector-General
This purpose of this legislation is to help more people avoid personal bankruptcy, whilst providing greater protection for both debtors and creditors.
By tightening the regulation of debt agreement regimes, this reform helps boost confidence in the industry whilst upholding professional standards. It also introduces tougher penalties for wrongdoing.
The debt agreement law reform also helps promote transparency between the administrator and stakeholders to ensure that the debt agreement system is accessible and equitable.
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