Chris Pearce MP, Parliamentary Secretary to the Treasurer, today welcomed the passage through the Senate of the Corporations Amendment (Insolvency) Bill 2007.
The changes will improve outcomes for creditors by enhancing protections for employee entitlements, providing creditors with better information about independence and remuneration, and removing unnecessary and costly procedural requirements. The Bill also introduces a ground breaking statutory pooling process to facilitate the winding up of related companies.
The reforms will provide ASIC with new powers and make it easier for ASIC to disqualify persons engaged in phoenix company activities by amending the procedural rules that are to apply in disqualification proceedings.
The Government has already implemented the $23 million assetless administration fund, targeted at deterring phoenix company behaviour. As at 30 June 2007, the fund has resulted in the disqualification of 46 directors for a total of 154 years with another 53 potential bannings in progress.
“These reforms are yet another vital enforcement function under threat by Labor’s planned cut to ASIC of almost $130 million. I call on Mr Rudd to display the leadership required to protect the millions of mum and dad investors by recanting on his massive cut to ASIC’s capabilities,” said Mr Pearce.
“Australia’s insolvency laws are well-regarded. However, it is important that laws continue to evolve with our markets. The cumulative impact of these reforms will result in improved certainty, reduced costs, and greater confidence in our markets,” said Mr Pearce.
CANBERRA
9 August 2007
Contact: Conor O'Brien (02) 6277 2088 or 0402 970 515