Bankruptcy Legislation Amendment (Debt Agreements) Act 2007 (44 of 2007)
Schedule 1 Amendments commencing on the day after Royal Assent
Bankruptcy Act 1966
19 At the end of Part IX
Add:
Division 8 - Registration of debt agreement administrators etc.
Subdivision A - Introduction
186A Basic eligibility test
Individuals
(1) For the purposes of this Division, an individual passes the basic eligibility test at a particular time (the test time ) unless:
(a) at any time during the 10-year period ending at the test time, the individual was:
(i) an insolvent under administration; or
(ii) a party (as a debtor) to a debt agreement; or
(b) at any time during the 10-year period ending at the test time, the individual was convicted of an offence involving fraud or dishonesty; or
(c) at the test time, the individual is disqualified from managing corporations under Part 2D.6 of the Corporations Act 2001; or
(d) at any time during the 10-year period ending at the test time, the individual’s registration as a liquidator was cancelled under subsection 1292(2) or (3) of the Corporations Act 2001; or
(e) at any time during the 10-year period ending at the test time, the individual’s registration as a trustee ceased under section 155I for a reason specified in paragraph 155H(1)(a), (aa), (b), (e), (f), (fa) or (g); or
(f) at any time during the 10-year period ending at the test time, the individual’s registration as a debt agreement administrator was cancelled under section 186K on the ground that:
(i) the individual contravened a condition that applied in relation to that registration; or
(ii) the individual failed to properly carry out the duties of an administrator in relation to a debt agreement; or
(g) at any time during the 10-year period ending at the test time, the individual’s registration as a debt agreement administrator was cancelled as a result of an order under section 185ZCA; or
(h) at any time during the 10-year period ending at the test time, a declaration was made under section 186M in relation to the individual; or
(i) at any time during the 10-year period ending at the test time, a determination in relation to the individual was made under subregulation 9.06(3) of the Bankruptcy Regulations 1996 as in force before the commencement of this section.
(2) Subparagraph (1)(a)(i) does not apply in relation to a bankruptcy that has been annulled under section 153B.
Companies
(3) For the purposes of this Division, a company passes the basic eligibility test at a particular time (the test time ) unless:
(a) at any time during the 10-year period ending at the test time, the company was an externally-administered body corporate; or
(b) at any time during the 10-year period ending at the test time, the company was convicted of an offence involving fraud or dishonesty; or
(c) at any time during the 10-year period ending at the test time, the company’s registration as a debt agreement administrator was cancelled under section 186L on the ground that:
(i) the company contravened a condition that applied in relation to that registration; or
(ii) the company failed to properly carry out the duties of an administrator in relation to a debt agreement; or
(d) at any time during the 10-year period ending at the test time, the company’s registration as a debt agreement administrator was cancelled as a result of an order under section 185ZCA; or
(e) at any time during the 10-year period ending at the test time, a declaration was made under section 186M in relation to the company; or
(f) at the test time, a director of the company does not pass the basic eligibility test; or
(g) at any time during the 10-year period ending at the test time, a determination in relation to the company was made under subregulation 9.06(3) of the Bankruptcy Regulations 1996 as in force before the commencement of this section.
Subdivision B - Registration of debt agreement administrators
186B Application for registration as a debt agreement administrator
(1) An individual or company may apply to the Inspector-General to be registered as a debt agreement administrator.
(2) The application must:
(a) be in the approved form; and
(b) be accompanied by such information and documents (if any) as are specified in the regulations; and
(c) if the application is not by way of renewal - be accompanied by the fee determined by the Minister by legislative instrument; and
(d) if the application is by way of renewal - be made before the expiry of the applicant’s existing registration as a debt agreement administrator.
186C Inspector-General must approve or refuse to approve registration application
(1) After considering an application made under section 186B, the Inspector-General must, within 60 days of receiving the application:
(a) approve the application; or
(b) refuse to approve the application.
Approval of application made by an individual
(2) If:
(a) the applicant is an individual; and
(b) the application is not by way of renewal;
the Inspector-General must approve the application if the Inspector-General is satisfied that the applicant:
(c) passes the basic eligibility test; and
(d) has the ability (including the knowledge) to satisfactorily perform the duties of an administrator in relation to debt agreements; and
(e) has such qualifications and experience (if any) as are prescribed by the regulations.
Otherwise the Inspector-General must refuse to approve the application.
(3) If:
(a) the applicant is an individual; and
(b) the application is by way of renewal;
the Inspector-General must approve the application.
Approval of application made by a company
(4) If:
(a) the applicant is a company; and
(b) the application is not by way of renewal;
the Inspector-General must approve the application if the Inspector-General is satisfied that the applicant:
(c) passes the basic eligibility test; and
(d) has the ability to satisfactorily perform the duties of an administrator in relation to debt agreements.
Otherwise the Inspector-General must refuse to approve the application.
(5) If:
(a) the applicant is a company; and
(b) the application is by way of renewal;
the Inspector-General must approve the application.
Guidelines
(6) In deciding whether to approve an application made under section 186B, the Inspector-General must have regard to any relevant guidelines in force under section 186Q.
Notice of decision
(7) If the Inspector-General refuses to approve an application made under section 186B, the Inspector-General must give the applicant a written notice of the refusal, and the reasons for it.
Review
(8) If the Inspector-General decides to refuse to approve an application made under section 186B, the applicant may apply to the Administrative Appeals Tribunal for review of the decision.
Conditions of registration
(9) If the Inspector-General approves an application under section 186B, the Inspector-General may decide that, if the applicant is registered as a debt agreement administrator under section 186D, the applicant’s registration as a debt agreement administrator is subject to specified conditions.
(10) If the Inspector-General makes a decision under subsection (9), the Inspector-General must give the applicant a written notice of the decision and the reasons for it.
(11) If the Inspector-General makes a decision under subsection (9), the applicant may apply to the Administrative Appeals Tribunal for review of the decision.
(12) In subsection (11):
decision has the same meaning as in the Administrative Appeals Tribunal Act 1975.
186D Registration as a debt agreement administrator
(1) This section applies if:
(a) the Inspector-General approves an application under section 186C; and
(b) the applicant has paid the fee determined by the Minister by legislative instrument.
(2) The Inspector-General must register the applicant as a debt agreement administrator by entering on the National Personal Insolvency Index the details relating to the applicant that are prescribed by the regulations.
(3) After registering the applicant as a debt agreement administrator, the Inspector-General must give the applicant a certificate of registration.
186E Duration of registration as a debt agreement administrator
Subject to this Division, if a person is registered under section 186D as a debt agreement administrator, the registration remains in force for:
(a) if the registration is not by way of renewal - 3 years beginning when the person’s details are entered on the National Personal Insolvency Index; or
(b) if the registration is by way of renewal - 3 years beginning immediately after the person’s existing registration as a debt agreement administrator expires.
186F Conditions of registration - general
(1) This section applies to a person if the person is a registered debt agreement administrator.
(2) The Inspector-General may, by written notice given to the person, impose specified conditions on the person’s registration as a debt agreement administrator.
186G Condition of registration - companies
(1) This section applies to a company if the company is a registered debt agreement administrator.
(2) It is a condition of the company’s registration as a debt agreement administrator that each individual who takes overall responsibility for managing the company’s debt agreement activities must be:
(a) a registered debt agreement administrator; or
(b) a registered trustee.
(3) Subsection (2) does not limit subsection 186C(9) or section 186F.
186H Application to change or remove registration conditions
(1) If there are conditions on a person’s registration as a debt agreement administrator, the person may apply to the Inspector-General for the conditions to be changed or removed.
(2) The application must:
(a) be in the approved form; and
(b) be accompanied by such information and documents (if any) as are specified in the regulations.
(3) After considering an application made under subsection (1), the Inspector-General must:
(a) decide that the conditions on the applicant’s registration as a debt agreement administrator should not be changed or removed; or
(b) decide that specified modifications should be made to the conditions imposed on the applicant’s registration as a debt agreement administrator.
Note: See the definition of modifications in subsection 5(1).
Notice of decision
(4) If the Inspector-General decides that the conditions on the applicant’s registration as a debt agreement administrator should not be changed or removed, the Inspector-General must give the applicant a written notice of the decision, and the reasons for it.
(5) If the Inspector-General decides that specified modifications should be made to the conditions imposed on the applicant’s registration as a debt agreement administrator, the Inspector-General must give the applicant a written notice of the decision, and the reasons for it.
Review
(6) The applicant may apply to the Administrative Appeals Tribunal for review of a decision of the Inspector-General made under this section.
(7) In subsection (6):
decision has the same meaning as in the Administrative Appeals Tribunal Act 1975.
Subdivision C - Surrender and cancellation of registration as a debt agreement administrator
186J Surrender of registration as a debt agreement administrator
(1) This section applies to a person if the person is a registered debt agreement administrator.
(2) The person may, by written notice given to the Inspector-General, request the Inspector-General to accept the surrender of the person’s registration as a debt agreement administrator.
(3) A request under subsection (2) must be in the approved form.
(4) The person ceases to be registered as a debt agreement administrator when the Inspector-General accepts the request.
(5) If the Inspector-General accepts a request given under subsection (2), the Inspector-General must remove the person’s registration details from the National Personal Insolvency Index.
186K Cancellation of an individual’s registration as a debt agreement administrator
Scope
(1) This section applies in relation to an individual if the individual is a registered debt agreement administrator.
Individual no longer passes the basic eligibility test
(2) The Inspector-General must cancel the individual’s registration as a debt agreement administrator if the Inspector-General is satisfied that the individual no longer passes the basic eligibility test.
Other grounds for cancellation of registration
(3) The Inspector-General may ask the individual to give the Inspector-General a written explanation why the individual should continue to be registered as a debt agreement administrator, if the Inspector-General has reasonable grounds to believe that:
(a) the individual no longer has the ability (including the knowledge) to satisfactorily perform the duties of an administrator in relation to a debt agreement; or
(b) the individual has failed to properly carry out the duties of an administrator in relation to a debt agreement; or
(c) the individual no longer has the qualifications or experience prescribed by regulations made for the purposes of paragraph 186C(2)(e); or
(d) the individual has contravened a condition of the individual’s registration.
(4) If:
(a) the Inspector-General does not receive an explanation within 28 days of requesting it; or
(b) receives an explanation, but is not satisfied with it;
the Inspector-General may cancel the individual’s registration as a debt agreement administrator.
Notice of cancellation
(5) If the Inspector-General cancels, under subsection (2) or (4), an individual’s registration as a debt agreement administrator, the Inspector-General must give the individual written notice of the cancellation, and the reasons for it.
Removal of registration details
(6) If the Inspector-General cancels, under subsection (2) or (4), an individual’s registration as a debt agreement administrator, the Inspector-General must remove the individual’s registration details from the National Personal Insolvency Index.
Guidelines
(7) In deciding whether to cancel, under subsection (2) or (4), an individual’s registration as a debt agreement administrator, the Inspector-General must have regard to any relevant guidelines in force under section 186Q.
Review
(8) If the Inspector-General decides to cancel, under subsection (2) or (4), an individual’s registration as a debt agreement administrator, the individual may apply to the Administrative Appeals Tribunal for review of the decision.
186L Cancellation of a company’s registration as a debt agreement administrator
Scope
(1) This section applies in relation to a company if the company is a registered debt agreement administrator.
Company no longer passes the basic eligibility test
(2) The Inspector-General must cancel the company’s registration as a debt agreement administrator if the Inspector-General is satisfied that the company no longer passes the basic eligibility test.
Other grounds for cancellation of registration
(3) The Inspector-General may ask the company to give the Inspector-General a written explanation why the company should continue to be registered as a debt agreement administrator, if the Inspector-General has reasonable grounds to believe that:
(a) the company no longer has the ability to satisfactorily perform the duties of an administrator in relation to a debt agreement; or
(b) the company has failed to properly carry out the duties of an administrator in relation to a debt agreement; or
(c) the company has contravened a condition of the company’s registration.
(4) If:
(a) the Inspector-General does not receive an explanation within 28 days of requesting it; or
(b) receives an explanation, but is not satisfied with it;
the Inspector-General may cancel the company’s registration as a debt agreement administrator.
Notice of cancellation
(5) If the Inspector-General cancels, under subsection (2) or (4), a company’s registration as a debt agreement administrator, the Inspector-General must give the company written notice of the cancellation, and the reasons for it.
Removal of registration details
(6) If the Inspector-General cancels, under subsection (2) or (4), a company’s registration as a debt agreement administrator, the Inspector-General must remove the company’s registration details from the National Personal Insolvency Index.
Guidelines
(7) In deciding whether to cancel, under subsection (2) or (4), a company’s registration as a debt agreement administrator, the Inspector-General must have regard to any relevant guidelines in force under section 186Q.
Review
(8) If the Inspector-General decides to cancel, under subsection (2) or (4), a company’s registration as a debt agreement administrator, the company may apply to the Administrative Appeals Tribunal for review of the decision.
Subdivision D - Ineligibility of a person to act as a debt agreement administrator
186M Inspector-General may declare a person ineligible to act as an administrator
(1) This section applies to a person if:
(a) the person is or was the administrator of a debt agreement; and
(b) the person is not:
(i) a registered debt agreement administrator; or
(ii) a registered trustee.
(2) The Inspector-General may ask the person to give the Inspector-General a written explanation why the person should continue to be eligible to act as an administrator of debt agreements, if the Inspector-General has reasonable grounds to believe that the person has failed to properly carry out the duties of an administrator in relation to the debt agreement.
(3) If:
(a) the Inspector-General does not receive an explanation within 28 days of requesting it; or
(b) receives an explanation, but is not satisfied with it;
the Inspector-General may declare that the person is ineligible, for a period of 3 years, to act as an administrator of debt agreements.
(4) If the Inspector-General makes a declaration under subsection (3), the Inspector-General must give the person written notice of the declaration, and the reasons for it.
Guidelines
(5) In deciding whether to make a declaration under subsection (3), the Inspector-General must have regard to any relevant guidelines in force under section 186Q.
Review
(6) If the Inspector-General decides to make a declaration under subsection (3) in relation to a person, the person may apply to the Administrative Appeals Tribunal for review of the decision.
Subdivision E - Miscellaneous
186N Return of certificate of registration
Surrender of registration as a debt agreement administrator
(1) A person commits an offence if:
(a) the person has been given a certificate of registration under subsection 186D(3); and
(b) the person gives a notice under subsection 186J(2) surrendering the person’s registration as a debt agreement administrator; and
(c) the person does not return the certificate of registration to the Inspector-General as soon as practicable after the Inspector-General accepts the notice.
Penalty: 1 penalty unit.
(2) Subsection (1) does not apply if the person has a reasonable excuse.
Note: A defendant bears an evidential burden in relation to the matter in subsection (2) (see subsection 13.3(3) of the Criminal Code).
Cancellation of an individual’s registration as a debt agreement administrator
(3) An individual commits an offence if:
(a) the individual has been given a certificate of registration under subsection 186D(3); and
(b) the individual’s registration as a debt agreement administrator is cancelled under section 186K; and
(c) the individual does not return the certificate of registration to the Inspector-General as soon as practicable after the individual is given a notice under subsection 186K(5) in relation to the cancellation.
Penalty: 1 penalty unit.
(4) Subsection (3) does not apply if the individual has a reasonable excuse.
Note: A defendant bears an evidential burden in relation to the matter in subsection (4) (see subsection 13.3(3) of the Criminal Code).
Cancellation of a company’s registration as a debt agreement administrator
(5) A company commits an offence if:
(a) the company has been given a certificate of registration under subsection 186D(3); and
(b) the company’s registration as a debt agreement administrator is cancelled under section 186L; and
(c) the company does not return the certificate of registration to the Inspector-General as soon as practicable after the company is given a notice under subsection 186L(5) in relation to the cancellation.
Penalty: 1 penalty unit.
(6) Subsection (5) does not apply if the company has a reasonable excuse.
Note: A defendant bears an evidential burden in relation to the matter in subsection (6) (see subsection 13.3(3) of the Criminal Code).
Strict liability
(7) Subsections (1), (3) and (5) are offences of strict liability.
Note: For strict liability , see section 6.1 of the Criminal Code.
186P Cessation of registration as a debt agreement administrator - no refund of fees
(1) This section applies if a person ceases to be registered as a debt agreement administrator.
(2) The person is not entitled to a refund of all or part of a fee paid by the person in relation to the person’s registration as a debt agreement administrator.
186Q Guidelines relating to Inspector-General’s powers
The Inspector-General may, by legislative instrument, formulate guidelines for the purposes of the following provisions:
(a) subsection 186C(6);
(b) subsection 186K(7);
(c) subsection 186L(7);
(d) subsection 186M(5).
Note: For consultation requirements, see Part 3 of the Legislative Instruments Act 2003.