The Treasury Laws Amendment (2017 Enterprise Incentives No 2) Bill 2017 was passed by the House of Representatives on 22 June 2017 and has had a second reading moved in the Senate.
- amends the Corporations Act 2001 (Cth) (Corporations Act) to create a safe harbour for company directors from personal liability for insolvent trading if the company is undertaking a restructure outside formal insolvency. (If passed, these amendments will take effect from the date of Royal Assent); and
- amends the Corporations Act and the Payment Systems and Netting Act 1998 (Cth) to make certain ‘ipso facto’ rights (i.e. rights which allow one party to terminate or modify the operation of a contract upon the occurrence of some specific event, regardless of otherwise continued performance of the counterparty) unenforceable while a company is restructuring under certain formal insolvency processes. (If passed, these amendments will take effect from a date set by Proclamation, or the later of 1 July 2018 and the day after 6 months from the date of Royal Assent).