Insolvency law reform in Australia and Singapore: Directors' liability for insolvent trading and wrongful trading

Steele, Stacey; Ramsay, Ian; Webster, Miranda

doi:10.1002/iir.1349

Cited by 6 publications

(7 citation statements)

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“…Sustainable Singapore Blueprint and Resource Sustainable Bill are the policies toward the CE in Singapore. Resource Sustainable Bill policy was applied in 2019 for obligations about waste collection and their treatment (Steele et al 2019 ). Besides, there are some incentives toward a CE, such as government research grants.…”

Section: Ce In Singaporementioning

confidence: 99%

Circular Economy: a Comparison Between the Case of Singapore and France

et al. 2021

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Nowadays, due to the continuous developments in economies, various dilemmas are emerging, including energy demand, waste management, and greenhouse gas emissions (GHE). A promising approach to address these issues is a transition toward a circular economy (CE), and one of its successful approaches is the waste-to-energy (WTE). By exploiting WTE, there will be less demand for raw materials and resources. In this study, two developed countries, including France and Singapore, are evaluated based on their CE transition using the WTE method. Both countries are developing rapidly in terms of a successful CE. Reducing landfills as the major problem in Singapore is one of the most vital plans in their CE project. The planned target in Singapore is reducing landfill by 30% by 2030. Furthermore, Singapore aims for reaching a 70% recycling rate by 2050. On the other hand, the CE in France includes more comprehensive laws in four different sectors, such as production, consumption, waste management, and mobilizing actors. It is planned that by 2025, the recycling rate in France will reach 100%. A roadmap toward building a CE cannot be succeeded unless some practical strategies are developed for overcoming the encountered obstacles. The roadmap of both countries shows a specific milestone to reach a better CE, cleaner environment, and less use of natural resources. Most of the Singapore sustainable plans are planned to be caught by 2030, while France is trying to complete them by 2025. It should be noted that due to the current pandemic situation caused by COVID-19, there are some issues in implementing the obligations and plans thoroughly.

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Section: Ce In Singaporementioning

confidence: 99%

Circular Economy: a Comparison Between the Case of Singapore and France

et al. 2021

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“…127 The rush to legislate in Australia and lack of experience with adjusting directors' duties in times of crisis when compared to Germany does not mean that perceived problems associated with section 588G were not considered seriously or previously, however. 128 The perception that directors file too quickly was a key driver for the introduction of the 2017 Safe Harbour. 129 Even before the 2017 Safe Harbour was introduced, it was also argued that the prohibition on insolvent trading was bad for the Australian economy because of the obligations, which it placed on directors, especially of small businesses.…”

Section: Reflections: What Does the Relief From Director's Duties In A Crisis Tell Us?mentioning

confidence: 99%

“…8 However, the regime has similarities to provisions in other jurisdictions, which prohibit what is known as wrongful trading (where the test for liability focuses less on the timing of "insolvency" than Australia's provisions), fraudulent trading (where the trading involves an element of dishonesty), and positive duties to file for external administration where a company is in financial difficulties such as Germany's. 9 The article begins by outlining the current Australian legislative provisions. For comparative purposes, the article then sets out the approach taken in Germany.…”

Section: Introduction: Directors' Duties In a Crisismentioning

confidence: 99%

Directors' duties to prevent insolvent trading in a crisis: Responses to COVID‐19 in Australia and lessons from Germany

Steele

2021

Intl Insolvency Rev

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This article considers relief from directors' duties to avoid trading whilst insolvent during the COVID‐19 pandemic in Australia and Germany. Comparative insolvency law literature traditionally compares Australia to jurisdictions such as the United Kingdom and New Zealand. However, Germany has a track record of using insolvency law to manage social and economic crises. The German approach suggests solutions to critical issues not dealt with in the Australian safe harbour legislation, such as the failure to suspend other statutory duties to provide clear guidance to directors on the balancing of various interests, and the treatment of potential voidable transactions and new monies (i.e., new funding or credit). The responses in both jurisdictions suggest a change in priorities away from creditor protection, a key raison d'être for these types of duties, during a crisis. Similar to the German approach of turning the obligation to file for formal insolvency proceedings off and on, the further safe harbour adopted in Australia as part of a new restructuring procedure for small businesses, which commenced on January 1, 2021, suggests that the use of safe harbours could become a permanent crisis‐management tool in Australia too, with potential consequences for the balance between debtor and creditor interests.

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“…25 Unlike s 304, s 303(3) did not require any fraudulent intent. 26 Section 303 (3) provided that an officer of a company committed an offence if, in the course of the winding up of the company, it appeared the officer was knowingly a party to the contracting of a debt provable in the winding up, and at the time the debt was contracted, the officer had no reasonable or probable ground of expectation, after taking into consideration the other liabilities, if any, of the company at the time, of the company being able to pay the debt. Civil liability for insolvent trading was also introduced in the 1960s in Australia.…”

Section: A Common Yet Divergent Historymentioning

confidence: 99%

“…2 This type of personal liability is a statutory exception to the general principle that corporate debts are owed by the company as a separate legal entity. 3 The liability of directors and other company officers for the debts of companies is a relatively recent phenomenon. Fraudulent trading provisions were introduced in the UK Companies Act 1929, 4 following recommendations by the Company Law Amendment Committee led by Mr Wilfrid Greene KC (known as the Greene Committee).…”

Section: Introductionmentioning

confidence: 99%