The Civil Law (Miscellaneous Provisions) Bill 2010 published on 30 August 2010 includes proposed amendments to Irish bankruptcy law. These are summarised below.

• A reduction of the period in which an application can be made to Court for discharge from bankruptcy from the current 12 year period to 6 years subject to existing discharge pre-conditions being satisfied (i.e. payment of the expenses, fees and costs of the bankruptcy and preferential debts). An application for discharge can be made at any time prior to the 6 year period if a bankrupt can pay all his/her creditors in full, or with the written consent of all his/her creditors.
  The implementation of a reduced 6 year period of discharge is still a lengthy period of time when compared to the discharge period in the UK which can be as little as 12 months or the EU discharge period which is on average 5 years.
• The introduction of a new automatic discharge from bankruptcy upon the 20th anniversary of a bankruptcy adjudication order.
• Where the Court is satisfied that the realised proceeds of the entirety of a bankrupt’s property, as at the date of application for discharge, ought to be sufficient to pay a dividend to the creditors, the Court is obliged under the provisions of Bill not to discharge the bankruptcy until such time as this dividend has actually been paid to the creditors. Thereafter any remaining property is revested or returned to the bankrupt.
• The current statutory limit of costs which the Official Assignee has the power to agree is proposed to be increased from €7,000 to €10,000.

It is worth noting that the existing legislative position whereby a bankrupt individual is entitled to an annulment of an adjudication of bankruptcy where he/she shows cause within three days from the date of service of the copy of the order of adjudication of bankruptcy, (extendable to 14 days by the Court), or, in any case where, the Court itself forms the opinion that the individual ought not to have been adjudicated bankrupt remains unaltered by the Bill.

Further additional reforms to bankruptcy laws are expected following consideration of the Law Reform Commission’s “Final Report on Personal Debt Management and Debt Enforcement” which is due by the year end.

It is anticipated that such further reforms will result in a new non-judicial debt settlement system operating in tandem with a more streamlined bankruptcy Court process, the specific nature and timing of which has yet to be determined.