Minister for Justice Alan Shatter recently unveiled further details about the new personal insolvency process, which forms part of the Personal Insolvency Act, 2012. An information campaign about the process has also begun.
Changes to Personal Insolvency Regime in Ireland The Personal Insolvency Act, 2012 (the Act), which provides for significant changes to the personal insolvency regime in Ireland, was signed into law on 26 December 2012. The Act will come into operation by way of a series of commencement orders to be made by the Minister for Justice and Equality, of which some have already been made.
The Act radically alters the law and procedures of personal insolvency. It reforms the existing bankruptcy law, including reducing the period of automatic discharge from bankruptcy from 12 years to three years and providing for a carve-out of pension assets from a bankruptee's estate. It also introduces, for the first time in Ireland, three new, largely non-judicial, debt resolution processes designed to offer an alternative to bankruptcy and which can address unsecured debts (of any value) and secured debts (up to 3 million in aggregate but without limit in the case of agreement).
The Act establishes an independent body to be known as the Insolvency Service of Ireland (the ISI) under the supervision of Director, Lorcan O'Connor, which will oversee the three new debt settlement processes contained in the Act: (1) Debt Relief Notices ("DRN") (applicable to unsecured debt up to 20,000), (2) Debt Settlement Arrangements ("DSA") (applicable to unsecured debt of any value) and (3) Personal Insolvency Arrangements ("PIA") (applicable to unsecured debt and secured debt up to 3m (unless all secured creditors agree to waive this limit). The ISI will also be responsible for the authorisation and regulation of personal insolvency practitioners (PIPs) in accordance with detailed provisions set out in the Act.
Launch of ISI website and information campaign On 18 April 2013, Minister for Justice, Alan Shatter, unveiled details of the new insolvency process and the ISI commenced an information campaign, including the publication of guides to the new debt settlement arrangements, the launch of a website (www.isi.gov.ie) and an information helpline for queries.
The ISI has also published the Guidelines on a Reasonable Standard of Living and Reasonable Living Expenses. The guidelines are central to the insolvency regime as they give an indication of...