On 11 May 2015, the Bankruptcy (Amendment) Bill 2015 (the “Bill”) was tabled in Parliament for first reading. Essentially, the Bill seeks to amend the Bankruptcy Act to create a more rehabilitative regime for bankrupts, ensure better utilisation of public resources and encourage creditors to exercise financial prudence when extending credit.
By way of background, between 16 January 2015 and 24 February 2015, the Ministry of Law (the “MinLaw”) had conducted a public consultation to seek feedback on proposed amendments to the Bankruptcy Act.
Set out below are five key proposed changes under the Bill:
- The minimum debt which must be owed before a person may be made bankrupt will be increased from S$10,000 to S$15,000.
- Banks, finance companies and large undertakings will be required to appoint a private trustee to administer the bankruptcy when applying to make a debtor bankrupt.
- There will be a new differentiated discharge framework where bankrupts can be discharged at fixed exit points.
- Bankrupts who fail to make certain payments in full prior to discharge will have their records permanently kept on a publicly available register maintained by the OA, enabling prospectivecreditors to make an informed decision when extending credit to such individuals.
- There will be a new expedited bankruptcy application process which allows a creditor to file a bankruptcy application before the expiry of the statutory demand (21 days after the statutory demand is served) if there is a serious possibility that the debtor’s property, or the value of the debtor’s property will be significantly diminished.