Australia—arrangements and reconstructions
Produced in partnership with Peter Kelso, solicitor

The following Restructuring & Insolvency practice note produced in partnership with Peter Kelso, solicitor provides comprehensive and up to date legal information covering:

  • Australia—arrangements and reconstructions
  • Scope of provisions
  • First court application—to convene meeting
  • Convening meeting
  • Appointment of administrator of scheme
  • Effect of scheme
  • Second court application—to approve scheme
  • Termination
  • Insolvency Practice Schedule (Corporations)

Australia—arrangements and reconstructions

Scope of provisions

Although the provisions of the Corporations Act (CA 2001) relating to arrangements and reconstructions are found in Ch 5, dealing with external administration, they are not limited to corporations which are, or may be, insolvent. A scheme covered by the provisions (in these notes all referred to as ‘schemes’) may be between the corporation and its creditors, or some of them, between the corporation and its members, or some of them, or between all three. It may, especially in the case of amalgamations, apply to a number of corporations. By reason of the definition of ‘Pt 5.1 body’ in CA 2001, s 9, it can also apply to foreign corporations registered here.

First court application—to convene meeting

An application for an order to convene a meeting or meetings is made ex parte. It may be made by the corporation, by any creditor or member, or by the liquidator if the company is in liquidation.

Convening meeting

Documents to convene a meeting include:

  1. a covering letter

  2. a notice of meeting

  3. a copy of the proposed scheme

  4. the explanatory statement, and

  5. a form of proxy

They will be sent to all known creditors.

Appointment of administrator of scheme

Although a scheme need not provide for the appointment of a person to administer its provisions, a scheme with creditors invariably will.

Effect of scheme

A scheme with creditors becomes binding on the

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