The Bankruptcy (Scotland) Act 2016 (the “Act”) received Royal Assent on 28 April 2016 and is expected to come into force by the end of the year.

The Act is only the second piece of primary consolidation legislation to have passed through the Scottish Parliament and brings together the various laws on personal insolvency into a single piece of legislation.

At the moment, the law is rather unwieldy and difficult to follow in practice.

The Bankruptcy (Scotland) Act 1985 has been heavily amended over the years resulting in a rather confusing numbering of provisions. For example, section 5, which deals with petitions for sequestration, contains the following sub-sections: 5(2)(b), 5(2ZA)(b), 5(2ZB)(b) and 5(2B) (b) and (bb). More recently, new primary legislation has been introduced in the form of the Bankruptcy and Diligence etc. (Scotland) Act 2007, the Home Owner and Debtor Protection (Scotland) Act 2010 and the Bankruptcy and Debt Advice (Scotland) Act 2014. Whilst the changes made have been necessary, having perplexing provisions and multiple sources does not assist those experiencing financial difficulties or the professionals advising in this area.

The Act addresses these problems by consolidating the relevant legislation and adopting a sensible structure. The Act’s provisions follow a logical progression through the personal insolvency process from the initial application or petition through to the discharge of the debtor and the trustee. It also includes separate parts on voluntary trust deeds and the Accountant in Bankruptcy.

The Act should make bankruptcy law more accessible and make it much easier for individuals in financial distress to get advice. It will also greatly assist the insolvency profession when offering advice on personal insolvency matters.