Ireland

The Second Report of the Company Law Review Group (CLRG) is currently in preparation and expected to be released in 2004. In its second report the Review Group will consider the possibility of a state funded public interest liquidation service and the law relating to the winding up of companies.

The Government of Ireland has approved the drafting of a single principal Companies Bill to replace the existing Companies Code, consisting of ten Acts plus a substantial amount of secondary legislation.

Key Legislation

• Companies Act 1963 and 1990 and amending legislation
• Bankruptcy Act 1988
• Company Law Enforcement Act 2001

Insolvency Procedures

Personal Insovency Procedures

Personal insolvency procedures are set out in the Bankruptcy Act 1988.
Bankruptcy proceedings begin in the High Court and in the vast majority of cases the Official Assignee in Bankruptcy (a court officer) is appointed to realise the assets of a bankrupt and distribute to proceeds to creditors (after paying fees and expenses). Bankruptcy can commence with a petition either from the debtor or a creditor. There are also arrangements that can be made outside of bankruptcy, either voluntary arrangements or arrangements under the control of the court.

The CLRG, as its name suggests, looks at the Company Law only, not bankruptcy law.

Corporate Insolvency Procedures

The Company Law in Ireland as it relates to winding-up proceedings is currently being reviewed by the CLRG.

Matters being reviewed include:

• State Liquidation Service
• Funding insolvent liquidations
• Summary liquidation procedure
• Reviewing preferential creditors
• Official exchanges of information
• Companies who cease to trade without liquidation
• Creditor's voluntary winding up.

In the first report issued in December 2001, the CLRG looked at creditor protection, including priorities in the event of winding-up and also the regulation of insolvency practitioners undertaking corporate insolvency work in Ireland.

Roles

Role played by Government

The Official Assignee in Bankruptcy is a government official who administers the vast majority of bankruptcies in Ireland.

The CLRG is part of the Department of Enterprise Trade and Employment. Also part of that Department is the Company Law Administration Section that enacts and administers the legislation as well as having policy and administrative responsibility for the Companies Registration Office and the Office of the Director of Corporate Enforcement (see separate profile)

Role played by private sector practitioners

The CLRG made recommendations in its first report released in Dec 2001 about the regulation of insolvency practitioners undertaking liquidations. The CLRG recommended that:

• The regulation model should be through the regulation of recognised professional bodies (RPBs), similar to the UK system.
• The Law Society of Ireland should be an RPB.
• There should be a specialised standard/qualification in insolvency practice for those who are licensed to practice.
• Insolvency practitioners should be required to have sufficient professional indemnity cover.

Role played by the Court

In Bankruptcy, the court appoints the Official Assignee.

The Court has a general oversight role in bankruptcy and company liquidation.

At a Glance

Does the insolvency system in Ireland allow for:

1.	Different procedures for the insolvency of individuals and the insolvency of companies?
2.	Creditors to accept an arrangement outside of formal bankruptcy/liquidation proceedings?
3.	Priority payment for employee creditors?
4.	Priority payment for taxation debts?
5.	Automatic disqualification of directors of failed companies from managing other companies?
6.	Recognition of insolvency proceedings being conducted in another jurisdiction?
7.	A government agency to undertake insolvency administration work?
8.	Some form of licensing of private sector practitioners?
9.	A review of the remuneration claimed by an insolvency practitioner by either a court or other government regulator?
10.	A mandatory scale of fees applicable to insolvency practitioner remuneration?
11.	Surveillance of the work of private sector practitioners by a government regulator?
12.	Collation of insolvency statistics by a government regulator?