The Businesses (Small Business Administrative Rescue procedure and Miscellaneous Provisions) Bill 2021 will amend the Businesses Act 2014 to permit small and micro companies — which constitute approximately 98 percent of companies — to get a new committed rescue procedure.
Robert Troy, minister for commerce promotion, electronic and business regulation, gloomy:”Government are decided to present SCARP when possible so that I wish to make sure a high degree of transparency that companies and stakeholders know SCARP along with the rationale supporting it.
“In designing a brand new rescue procedure for small and micro businesses, my section believed that the CLRG report also started a public consultation on many matters including the addition of repudiation within an administrative procedure and the standing of State creditors.
“I think we’ve struck the correct balance to come up with a simplified and efficient procedure which will assist viable organizations to restructure and stay in operation.”
The new administrative rescue procedure will consist of provisions mirroring those in examinership such as the repudiation of onerous contracts, automated stay proceedings, cross-clam cram down of debts, also promotes continuing lender engagement.
Where businesses owe debts to the State through the Revenue Commissioners, The State is only going to have the ability to opt out of a procedure on restricted and specified grounds that will be put out in the laws, like if a firm could use the procedure to prevent tax.
Mr Troy said:”My section, with the support of the Attorney General, is now drafting the laws at speed. I look ahead to the invoice, when drafted, being printed and released in the Dáil whenever possible.”
He added:”SCARP is a further demonstration of government’s commitment to do everything that it could to assist our companies across the path to recovery as we emerge out of Covid-19.
“It will give an extra choice to micro and tiny businesses who must restructure and if enacted will provide a procedure that’s more cost efficient and effective at completion within a shorter time period.”