The Freight Transport Association Ireland (FTAI) has voiced its support of the decision by the Minister for Justice, Frances Fitzgerald to bring the Bill to Cabinet updating bankruptcy rules in Ireland. Under the Bill outlined by the Minister, the standard period for bankruptcy has been reduced from three years to one.
Neil McDonnell – FTA Ireland General Manager said: “FTAI Ireland supports the decision by the Minister for Justice to update our bankruptcy laws in line with those that apply among our closest trading partners, and the provision of an extension of bankruptcy for cases of non-cooperation. While we await the detail of the Bankruptcy Bill, the policy to provide a benign bankruptcy regime for those debtors who engage positively and honestly with their creditors is most welcome.”
In its 2105 pre-budget submission submitted to the Government in July, FTA Ireland called for improvements to the lengthy, onerous and inefficient bankruptcy procedure in Ireland.
Mr McDonnell added: “Historically, Ireland’s bankruptcy laws have been little comfort to creditors, while imposing an unusually long (12 year) period of bankruptcy on debtors. This was to no one’s advantage.”
“Even the recent reduction in the term of bankruptcy did little to stem the flow of bankruptcy tourists to the UK, the US, and the Bahamas. Ireland’s bankruptcy laws were demonstrably unfit for purpose.”
The Minister has proposed that serious cases of non-cooperation will result in the bankruptcy period being extended to up to 15 years. At present the maximum penalty is eight. It will also increase the penalties for those who try to hide their assets.
McDonnell concluded: “We have witnessed the robust and speedy nature of bankruptcy proceedings in the US, where debtors can avail of a fast and efficient bankruptcy regime. On the other hand, the US has proven a dangerous place for those debtors seeking bankruptcy who fail to make a full and frank disclosure of their assets.”