On 24 September 2020, the Government announced changes to Australia’s insolvency framework to better serve Australian small businesses, their creditors and their employees.
These reforms, which commenced on 1 January 2021, will support Australia to emerge from the pandemic with a stronger, more resilient and more competitive economy. They will help to give businesses and their creditors certainty, which is crucial to kick-starting confidence and activity as the economy transitions to the recovery phase.
Following the commencement of these reforms, the Government is consulting on whether to permanently raise the minimum threshold at which creditors can issue a statutory demand on a company.
A statutory demand is a formal demand for payment of a debt owed by a company, issued under the Corporations Act 2001.
Currently, a statutory demand can be issued on a company in relation to a debt that is due and payable and totals at least $2,000.
Written submissions are sought from stakeholders on whether the threshold should remain at $2,000, or whether it should be increased to some other amount going forward.
You can submit responses to this consultation up until 05 March 2021. Interested parties are invited to comment on this consultation.
While submissions may be lodged electronically or by post, electronic lodgement is preferred. For accessibility reasons, please submit responses sent via email in a Word or RTF format. An additional PDF version may also be submitted.
All information (including name and address details) contained in submissions will be made available to the public on the Treasury website unless you indicate that you would like all or part of your submission to remain in confidence. Automatically generated confidentiality statements in emails do not suffice for this purpose. Respondents who would like part of their submission to remain in confidence should provide this information marked as such in a separate attachment.
Legal requirements, such as those imposed by the Freedom of Information Act 1982, may affect the confidentiality of your submission.
View our submission guidelines for further information.
How To Respond
Address written submissions to:
Business Conduct Unit
Market Conduct Division
Parkes ACT 2600