The Australian corporate rescue regime: bold experiment or sensible policy?

✍ Scribed by Colin Anderson

• Book ID: 102271178
• Publisher: John Wiley and Sons
• Year: 2001
• Tongue: English
• Weight: 304 KB
• Volume: 10
• Category: Article
• ISSN: 1180-0518
• DOI: 10.1002/iir.89

✦ Synopsis

Abstract

This paper takes its title from a paper given by the Honourable Justice Robert Austin, of the Supreme Court of New South Wales, to a conference on Key developments in Corporate Law and Equity in March 2001. In that speech he described Australia's corporate rescue regime as a “bold experiment”. This paper suggests that this is not a justified description and further that it is unlikely to end in the foreseeable future. The paper consists of a broad outline of how the system operates in Australia. It provides some commentary on the more significant features of the operation of Part 5.3A of the Corporations Law and considers suggestions that have been made in respect of reform of the legislation. The paper goes on to consider how the regime has been used since its introduction showing it is now the most widely used form of insolvency administration. The paper then examines briefly some of the attempts at evaluation of the regime. It concludes by suggesting that at this stage there is inadequate information to be conclusive as to the procedure's success or otherwise in fulfilling its aims of providing better returns to creditors. It is argued first, that the wide use of the procedure suggests that it is unlikely to be fundamentally altered in the near future. A further conclusion is that there is some soundness in the approach that the legislation takes in having less court control and a greater role played by the insolvency practitioner.