In late September 2020, the federal government announced that it would be introducing changes to Australia’s Corporations Act (Act) and the most significant amendments to the corporate insolvency regimes in decades. The main objective is to help the small business sector deal with and overcome the economic, financial and trading challenges posed by the ongoing pandemic. Since then, the government has released its new laws via the Corporations Amendment (Corporation Insolvency Reforms) Bill 2020 (Cth) (New Laws).
The New Laws represent a monumental shift in the mindset underpinning Australia’s restructuring and insolvency regime from a predominantly creditor-led system to now a hybrid of creditor-led and debtor-in-possession processes.
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