The new Building Industry Fairness (Security of Payment) Bill 2017 (Qld) was assented to on 10 November 2017, which will see the introduction of project bank accounts (PBAs) into the Queensland construction industry. As the project bank account provisions will be trialled from 1 January 2018, contractors, at least those involved in State Government projects, should familiarise themselves with the relevant provisions.

What Are Project Bank Accounts?

A PBA is a trust over:

In brief

The Government has released a consultation paper as part of their commitment to ongoing reform of Australia’s corporate insolvency regime.  Phoenix activity refers to both legitimate business rescue activities and serial insolvency to avoid debts.

Australia’s corporate insolvency regime has undergone significant reform with the passing of the Treasury Laws Amendment (2017 Enterprise Incentives No. 2) Bill 2017 (the Bill) through both houses of parliament.

This week’s TGIF considers the case of Official Assignee in Bankruptcy of the Property of Cooksley, in the matter of Cooksley v Cooksley, in which the Federal Court granted assistance to the High Court of NZ in administering a bankruptcy.

BACKGROUND

As part of broader reforms to Australia’s corporate insolvency laws, new laws will restrict the ability of a party to enforce a right to terminate a contract in the case where the counterparty suffers an insolvency event (commonly known as ‘ipso facto’ clauses).

What are ‘ipso facto’ clauses?

The reforms proposed to combat illegal phoenix activity range from light-touch through to more significant changes to the Corporations Act.

DOING BUSINESS

IN AUSTRALIA Restructuring and insolvency

OCT 2017

WWW.CORRS.COM.AU

DOING BUSINESS IN AUSTRALIA

RESTRUCTURING AND INSOLVENCY

AUSTRALIAN INSOLVENCY PROCESSES

The key insolvency-related processes relevant to Australian companies under Australian law are:

Voluntary Administration;

Liquidation; and

Receivership.

The Boart Longyear decisions confirm that class constitution remains a critical issue for review when pursuing creditors' schemes of arrangement.

The New South Wales Court of Appeal has recently confirmed the circumstances in which companies seeking approval of schemes of arrangement will be required to convene separate meetings for different classes of creditors.

Class constitution: key principles

Following a suite of recent reforms to Australian insolvency laws, liquidators are now able to assign rights to sue, conferred on them personally by the Corporations Act. The new power to assign is broad. It appears that the implications of the power will need to be clarified by the judiciary before they are fully understood.

In this article, we look at the issues that arise from these legislative amendments along with the opportunities created.