The Bankruptcy Legislation Amendment Bill 2009 has been passed by Parliament.

The Bill’s reforms include:

• increasing the minimum amount for which a creditor can petition for bankruptcy from $2,000 to $5,000 (down from the $10,000 originally proposed);
• increasing the stay period before a creditor can commence action to recover debts from seven to 21 days (as opposed to 28 days originally proposed);
• changing the process for fixing and reviewing trustee remuneration;
• strengthening the penalties for some offences, particularly those involving fraud;
• enhancing powers for the Inspector-General in Bankruptcy to investigate possible offences.

Proposed increases in the income, asset and debt thresholds for voluntary debt agreements have been deferred.

The commencement of the amendments depends on the proclamation date but it will not be later than 6 months.

UPDATE: Bill assented to on 14 July 2010.

UPDATE: Act commenced 11 August 2010

Download consolidated Bankruptcy Act