Bringing US Chapter 11 to Australia

Articles, Restructuring + Insolvency

The Senate Economics Reference Committee has released a report recommending that federal parliament investigate implementing a US style “Chapter 11” process for large insolvencies.  Such an approach would likely involve much greater protection for a debtor company trading through a liquidity crisis.  Interestingly the report quoted the ASIC Chairman as praising the Chapter 11 system as keeping “management with the company, as opposed to handing the management to an insolvency expert”.