Changes to Irish bankruptcy law

Changes to Irish bankruptcy law

Frank Flanagan, Senior Associate at Mason Hayes & Curran, examines the Bankruptcy (Amendment) Act 2015, which makes several changes to the rules on bankruptcy in Ireland including reducing the bankruptcy term to one year, bringing them in line with that of the UK.

What changes have been made to the bankruptcy process in the Republic of Ireland as a result of the Bankruptcy (Amendment) Act 2015?

The Bankruptcy (Amendment) Act 2015 (the 2015 Act) amends the Bankruptcy Act 1988 (as amended) (the 1988 Act) to:

  • reduce the default term of bankruptcy from three years to one year from the date of adjudication
  • reduce the default term of bankruptcy payment orders from five years to three years
  • recognise civil partnerships
  • provide for automatic re-vesting of family homes/shared homes/principal private residences after three years, and
  • make a number of technical changes, including:
    • a provision for electronic records, and
    • removing the statutory sitting of the court (not yet commenced)

Default term of bankruptcy

The default term of bankruptcy is now one year, which is in line with the term in England and Wales, and Northern Ireland.

Where a bankrupt has:

  • failed to co-operate with the Official Assignee, or
  • concealed assets or income from the Official Assignee, or failed to disclose assets or income to the Official Assignee, which could have been realised for the benefit of creditors

the court may, where it considers it just, on the application of the Official Assignee (or a creditors’ trustee where appointed), make an order substituting a date, up to eight years from the date of adjudication for the date on which the bankruptcy would have expired.

In more serious cases, this term may be extended to 15 years where the court considers it just to do so.

Term of bankruptcy payment orders

Bankruptcy payment orders now have a default term of three years, although this can be increased to five years.

Recognition of civil partn

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About the author:

Stephen qualified as a solicitor in 2005 and joined the Restructuring and Insolvency team at Lexis®PSL in September 2014 from Shoosmiths LLP, where he was a senior associate in the restructuring and insolvency team.

Primarily focused on contentious and advisory corporate and personal insolvency work, Stephen’s experience includes acting for office-holders on a wide range of issues, including appointments, investigations and the recovery and realisation of assets (including antecedent transaction claims), and for creditors in respect of the impact on them of the insolvency of debtors and counterparties.