The Minister for Justice, Equality and Defence, Alan Shatter, TD, announced the commencement of section 4 of the Personal Insolvency Act 2012 dealing with bankruptcy on 3 December 2013. Other elements of the act, including the introduction of alternative insolvency arrangements such as personal insolvency arrangements, have already been introduced.
The implementation of the new bankruptcy reforms is the last piece of the jigsaw as regards Ireland's new personal insolvency regime, following the introduction of the Personal Insolvency Act 2012. This new regime effectively overhauls the antiquated pre-existing bankruptcy regime, bringing Ireland closer into line with our European neighbours. Overall, there is an emphasis in the new personal insolvency regime on first attempting to work out an arrangement with creditors, with bankruptcy itself as a last resort.
The Insolvency Service of Ireland has published a number of guides to the new regime, available here.
Some of the key changes introduced to the bankruptcy regime include the following:
Critically, there will now be automatic discharge from bankruptcy after three years from the date of adjudication - a significant reduction from the current 12 years. This will have retrospective effect, meaning that people already declared bankrupt will be able to benefit from the shorter discharge period. Bankruptcies currently existing for three years or more at today's date will be automatically discharged after a further six months have elapsed. This latter extension is an initial transitional period intended to permit the Official Assignee in Bankruptcy or a creditor to object to...