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Bankruptcy Amendment Regulations 2007 (No. 1)

Authoritative Version
  • - F2007L01128
  • No longer in force
SLI 2007 No. 91 Regulations as made
These Regulations amend the Bankruptcy Regulations 1996 to provide that specified payments pursuant to specified rural support schemes are non-divisible property upon the bankruptcy of a grant recipient.
Administered by: Attorney-General's
Registered 26 Apr 2007
Tabling HistoryDate
Tabled HR08-May-2007
Tabled Senate09-May-2007
Date of repeal 09 Apr 2013
Repealed by Attorney-General's (Spent and Redundant Instruments) Repeal Regulation 2013

EXPLANATORY STATEMENT

Select Legislative Instrument 2007 No. 91

Issued by the Authority of the Attorney-General

 

Bankruptcy Amendment Regulations 2007 (No. 1)

Subsection 315(1) of the Bankruptcy Act 1966 (the Act) provides that the Governor-General may make regulations prescribing matters required or permitted by the Act to be prescribed or necessary or convenient to be prescribed for carrying out or giving effect to the Act.

The Act establishes a national framework for bankruptcy, including making provision for the realisation of property for the benefit of creditors and the payment of compulsory contributions by bankrupts out of their post bankruptcy income. There are limits on the property that may be realised for the benefit of creditors (section 116 of the Act) and the income to which the compulsory income contribution regime applies (section 139L of the Act).

The purpose of the Regulations is to amend the Bankruptcy Regulations 1996 (the Principal Regulations) consequential to the Bankruptcy Legislation Amendment (Superannuation Contributions) Act 2007 (the Amendment Act) and to align the treatment of a number of rural support grants. In particular, the Regulations bring the treatment in bankruptcy of Sugar Industry Reform Program 2004 (SIRP 2004) grants, Tobacco Growers Adjustment Assistance Package 2006 (TGAAP 2006) grants and Dairy Exit Program (Dairy Exit) grants into line with the treatment in bankruptcy of Farm Help Re-establishment Grant Scheme (Farm Help) grants.

The Amendment Act repeals paragraphs 116(2)(k) to (mcb) of the Act, replacing them with the new paragraphs 116(2)(k) to (mb), with the effect that specified payments under rural support schemes which are not to be divisible property upon the bankruptcy of the grant recipient will henceforth be prescribed in the regulations, not in the Act.

This power is in addition to existing subparagraph 139L(1)(b)(v) of the Act which authorises the making of regulations that provide that certain amounts or payments do not fall within the  definition of “income” for the purposes of the compulsory income contribution regime.

The Regulations reproduce in the Principal Regulations the classes of non-divisible property referred to in the former paragraphs 116(2)(k) to (mcb) in the Act. This maintains the status quo in respect of these classes of rural grant. Future consequential amendments to these paragraphs necessitated by any changes to the relevant rural support grant schemes will now be able to be effected without the passage of primary legislation.

The Regulations also amend the Principal Regulations to provide that:

·        all payments, to persons exiting agricultural industries, pursuant to SIRP 2004 are prescribed amounts for the purposes of the paragraphs 116(2)(k) to (ma) of the Act, and are prescribed amounts under subparagraph 139L(1)(b)(v) of the definition of “income” for the purposes of the compulsory income contribution regime;

·        all payments, to persons exiting agricultural industries, pursuant to the TGAAP 2006 are prescribed amounts for the purposes of the paragraphs 116(2)(k) to (ma) of the Act, and are prescribed amounts for the purpose of subparagraph 139L(1)(b)(v) of the definition of “income” for the purposes of the compulsory income contribution regime;

·        all payments pursuant to Dairy Exit are prescribed amounts for the purpose of subparagraph 139L(1)(b)(v) of the definition of “income” for the purposes of the compulsory income contribution regime.

The effect of these amendments is that grants pursuant to SIRP 2004, TGAAP 2006 and Dairy Exit receive similar treatment in bankruptcy to grants pursuant to the Farm Help scheme.

Details of the Regulations are set out in the Attachment.

The Regulations commence on 27 April 2007.

 

 


Attachment

                                                                                                                                        

                                                                                                                                        

Details of Bankruptcy Amendment Regulations 2007 (No. 1)

 

Regulation 1—Name of Regulations

 

This regulation is a formal provision specifying the title of the Regulations as the Bankruptcy Amendment Regulations 2007 (No . 1).

 

Regulation 2—Commencement

 

This regulation specifies that the Regulations commence on the commencement of item 5 of Schedule 2 of the Bankruptcy Legislation Amendment (Superannuation Contributions) Act 2007, which repeals the former paragraphs 116(2)(k) to (mcb) of the Bankruptcy Act 1966 (the Act).

 

Regulation 3—Amendment of Bankruptcy Regulations 1996

 

This regulation specifies that Schedule 1 to the Regulations amends the Bankruptcy Regulations 1996 (the Principal Regulations).

 

Schedule 1—Amendments

 

Item [1]

 

Item 1 inserts definitions for “1985 Rural Adjustment Grant Scheme” and “1988 Rural Adjustment Grant Scheme”  which correspond to those grant schemes referred to in the former paragraphs 116(2)(ma) and (mb) of the Act, respectively. These terms are utilised in the proposed regulation 6.04B below.

 

Item [2]

 

Item 2 inserts definitions for “farm help re-establishment grant scheme” and “DEP scheme” which correspond to those grant schemes referred to in the former paragraphs 116(2)(mca) and (mcb) of the Act, respectively. The terms are utilised in the proposed regulation 6.04A below.

 

Item [3]

 

Item 3 inserts definitions for “Rural Reconstruction Grant Scheme”, “Rural Adjustment Grant Scheme” and “Rural Adjustment Scheme” which correspond to those grant schemes referred to in the former paragraphs 116(2)(k), (m) and (mc) of the Act, respectively. These terms are utilised in proposed regulation 6.04B.

 

Item 3 also proposes a definition for the term “rural support scheme” as having the same meaning as that term in the Act. This term is used in the new paragraphs 116(2)(k) to (ma) of the Act which provide for the power to make regulations specifying that certain rural grants are non-divisible property. The term is utilised in the proposed regulations 6.04A and 6.04B.

 

Item 3 also inserts definitions for “Sugar Industry Reform Program” and “Tobacco Grower Adjustment Assistance Package”. These terms refer to the Sugar Industry Reform Program 2004 and the Tobacco Grower Adjustment Assistance Package 2006 respectively. The terms are utilised in the proposed regulation 6.04B.

 

Item [4]

 

Item 4 renumbers the current regulation 6.04 as regulation 6.03B to facilitate the insertion by the following additional regulations.

 

Item [5]

 

Item 5 inserts the heading for a new Division 2A into the Principal Regulations.

 

Regulation 6.04A of the new Division, utilising the definitions inserted by Item 2,  provides that the classes of rural grants formerly specified as non-divisible property by the paragraphs 116(2)(mca) and (mcb) of the Act are to be specified as non-divisible property by virtue of the Principal Regulations.

 

Regulation 6.04B of the new Division, utilising the definitions inserted by Items 1 and 3, provides that the classes of rural grants formerly specified as non-divisible property by the paragraphs 116(2)(k) and (mc) of the Act are to be specified as non-divisible property by virtue of the Principal Regulations.

 

Regulation 6.04B of the new Division, utilising the definitions of “Sugar Industry Reform Package” and “Tobacco Grower Adjustment Assistance Package” inserted by Item 3, also provides that payments pursuant to those rural grants to persons exiting all agricultural industries are non-divisible property by virtue of the Principal Regulations.

 

 

Item [6]

 

Item 6 inserts a new regulation 6.12D which provides that those payments pursuant to the DEP Scheme, the Sugar Industry Reform Package and the Tobacco Grower Adjustment Assistance Package that are specified by regulations 6.04A and 6.04B to be non-divisible property are also excluded from the definition of income for the purposes of the compulsory income contribution regime in the Act.