The Bankruptcy (Amendment) Act 2015

The Bankruptcy (Amendment) Act 2015 (2015 Act) commenced on 29th January 2016. The 2015 Act, which amended the Bankruptcy Act 1988 (as amended) (1988 Act), has brought Irish bankruptcy law broadly in line with that of the United Kingdom.
The following key amendments have been made to bankruptcy legislation in Ireland, namely:

  1. There is a default bankruptcy term of one year from the date of adjudication of bankruptcy. Previously under the 1988 Act the default term was three years.
  2. Where a bankrupt has not co-operated with the Official Assignee or has wilfully concealed assets or income which could have been realised, the Court may on the application of the Official Assignee make an order to have the term of bankruptcy increased by up to eight years from the date of adjudication or fifteen years where the Court considers it just to do so.
  3. If the Official Assignee has neither sold the bankrupt’s home nor applied to the High Court for an order for sale, within three years, then the legal interest in the home may vest back in the bankrupt’s name. However, the re-vested estate or interest will remain subject to any pre-existing mortgage.
  4. Bankruptcy payment orders are now in force for a period of three years rather than five. This is a court order requiring a bankrupt to make payments to creditors from any surplus income or assets following the deduction of ‘reasonable’ living expenses.

The 2015 Act has sought to diminish the attractiveness of Irish citizens seeking to avail of bankruptcy regimes in other countries, especially the United Kingdom. The bankruptcy regime in Ireland is now far more balanced in that it seeks to assist debtors who are cooperative with the Official Assignee while also giving the Court remit to impose more severe sanctions on debtors who try to abuse the process.