Recent package of reforms to assist small businesses and introduction of the Small Business Restructuring Practitioner (SBRP) role
The government has recently announced a package of reforms (including the SBRP role) to commence on 1 January 2021, subject to the passing of legislation.
Key elements of the reforms include:
(i) A new formal debt restructuring process for small businesses to provide a faster and less complex mechanism for financially distressed but viable firms to restructure their existing debts, maximising the chance of them surviving and contributing to economic and jobs growth.
(ii) A new, simplified liquidation pathway for small businesses to allow faster and lower-cost liquidation, increasing returns for creditors and employees.
(iii) Complementary measures to ensure the insolvency sector can respond effectively both in the short and long term to increased demand and to the needs of small business.
More details of the recent reforms include:
- Wexted Advisors paper including an overview of the proposed law changes, how long will the process take and how much it will costs and our general views of the new reforms: https://www.wexted.com/wp-content/uploads/2020/09/The-introduction-of-a-Small-Business-Restructuring-Practitioner-to-restructure-your-business.pdf
- Australian Government Fact Sheet – Insolvency reforms to support small business: https://www.wexted.com/wp-content/uploads/2020/10/Insolvency-reforms-factsheet-201007.pdf