Recent History – changes introduced in 2020 which no longer apply
During 2020, to try and mitigate the adverse impact COVID-19 was having on business in Australia, the Federal Government introduced temporary changes to both corporate and personal insolvency law to try to alleviate a very difficult trading environment. In particular the temporary (i.e. for the 6 months ended September 2020) measures included:
- increasing the debt threshold (minimum amount owing) upon which creditors could issue a Statutory Demand to corporate debtors (increasing from $2,000 to $20,000)
- increasing the debt threshold (minimum amount owing) upon which creditors could commence bankruptcy proceedings against individual debtors (increasing from $5,000 to $20,000)
- increasing the time period for responses by debtors to Statutory Demands (corporate debts) and Bankruptcy Notices (personal debts) – increasing from 21 days to six months
- temporary relief, in the absence of fraudulent conduct, for directors from the insolvent trading (personal liability) provisions of the Corporations Act 2001, for the 6 month period following the change
Contact us at mail@fergusons.com.au or phone (08) 8359 2550 to discuss