Published 28 April 2010
Commerce Minister Simon Power introduced the Insolvency Practitioners Bill to Parliament yesterday. Its intention is to give the Registrar of Companies greater powers over liquidators, receivers & voluntary administrators.
Mr Power said the new law would ensure insolvency practitioners who don’t meet the required standard are either banned or placed under the supervision of an experienced insolvency practitioner: "The primary purpose of the bill is to introduce a negative licensing system, which will give the Registrar of Companies the statutory authority to place under supervision or prohibit individuals from providing corporate insolvency services. Unfortunately there are a small number of insolvency practitioners who do not operate to the required standard.
"Practitioners must not put their own interests or the interests of the insolvent company’s directors or shareholders ahead of creditors who may be owed money. The effective winding up of an insolvent company must be handled with integrity."
The bill also empowers the Registrar of Companies to maintain a publicly accessible electronic register of people who have been banned or placed under supervision.
Mr Power said he hoped the law would come into force in July next year. At that point, the registrar will be able to take into account conduct that has taken place before the new law was enacted. The court maintains parallel powers to ban practitioners for indefinitely.
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Attribution: Ministerial release, story written by Bob Dey for the Bob Dey Property Report.