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Australia

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On 1 January 2021, the Federal Government’s post-COVID small business restructuring reform package came into effect. This package introduced into the Corporations Act 2001 (Cth) (Corporations Act): two new insolvency regimes for companies with liabilities of less than AUD 1 million, namely:a “debtor in possession” restructuring and restructuring plan process (Restructuring)a simplified liquidation process (Simplified Liquidation)temporary insolvency relief for companies (and their officers) that wish to enter restructuring but cannot find a registered liquidator able…

In brief Creditors commonly find that their applications to wind up a company are suddenly deferred at the last minute by the appointment of a voluntary administrator.  Now, in the early days of the small business restructuring (Part 5.3B) process, the courts are already grappling with those circumstances in the context of that new regime. At the time of writing, only four restructuring appointments under Part 5.3B have been notified to ASIC. Two of them…