| This Bill seeks to introduce a new omnibus Act that consolidates the personal and corporate insolvency laws, and the laws relating to debt restructuring by individuals and companies, previously found in 2 separate statutes, into a single piece of legislation. The proposed enactment of a consolidated statute was recommended in the report of the Company Legislative and Regulatory Framework Committee released in October 2002 and the report of the Insolvency Law Review Committee dated 4 October 2013 (the Insolvency Law Review Committee Report). The Bill also seeks to implement changes that are related to the recommendations in the Insolvency Law Review Committee Report and the report of the Committee to Strengthen Singapore as an International Centre for Debt Restructuring dated 20 April 2016. |
| The Bill is part of a phased approach (following the earlier phases involving amendments to the Bankruptcy Act (Cap. 20) vide the Bankruptcy (Amendment) Act 2015 (Act 21 of 2015) and to the Companies Act (Cap. 50) vide the Companies (Amendment) Act 2017 (Act 15 of 2017)) to update and enhance Singapore’s insolvency and restructuring laws, in particular to — |
| (a) | create a more rehabilitative discharge framework for bankrupts, and encourage institutional creditors to exercise financial prudence when granting credit; | | (b) | modernise Singapore’s insolvency and restructuring laws to support Singapore’s position as an international financial and business centre; | | (c) | enhance Singapore’s corporate rescue and restructuring processes, in order to strengthen Singapore as an international centre for debt restructuring; and | | (d) | introduce a licensing and regulatory regime that is applicable to insolvency and debt restructuring officeholders undertaking specific types of work, thereby establishing a common and consistent standard of professional regulation. |
| The Bill repeals, and re-enacts with modifications, the provisions of the Bankruptcy Act, and certain provisions of the Companies Act (including the provisions on receivership, winding up, judicial management and compromises or arrangements between a company and its creditors). The Bill does not incorporate the specific insolvency and restructuring regimes applicable to entities in particular industries or businesses, such as banks and insurance companies. These specific regimes will continue to reside in the specific legislation relating to those respective industries or businesses. |
| The Bill also makes consequential and related amendments to certain other Acts. |
| Part 1 (clauses 1 and 2) introduces definitions for terms that apply across different Parts of the Bill. |
| Part 2 (clauses 3 to 15) relates to the jurisdiction of the High Court in corporate insolvency and winding up, individual insolvency and bankruptcy, and related matters under the Bill, and to the powers and procedures of the High Court. |
| Part 3 (clauses 16 to 60) relates to the appointment and general duties of the Official Assignee, the Official Receiver and a trustee in bankruptcy, and establishes a new licensing and regulatory regime relating to persons acting as insolvency practitioners. Part 3 comprises the following Divisions: |
| (a) | Division 1 (clauses 16 to 35), which relates to the appointment and general duties of the Official Assignee and Official Receiver; | | (b) | Division 2 (clauses 36 to 46), which relates to the appointment and general duties of a trustee in bankruptcy; | | (c) | Division 3 (clauses 47 to 60), which contains a new licensing and regulatory regime relating to persons acting as insolvency practitioners. |
| Part 4 (clauses 61 and 62) contains definitions of terms and interpretative provisions for Parts 4 to 12. |
| Part 5 (clauses 63 to 72) contains provisions relating to a compromise or an arrangement between a company and its creditors (or a class of the creditors), which re‑enact with modifications sections 211A to 211J of the Companies Act. These provisions apply in addition to sections 210 and 211 of the Companies Act. |
| Part 6 (clauses 73 to 87) re-enacts with modifications and additions the provisions of Part VIII of the Companies Act relating to receivership. Part 6 applies to both receivers or managers appointed in Singapore or elsewhere over the property of a company, and receivers or managers appointed in Singapore over the property in Singapore of a corporation other than a company. |
| Part 7 (clauses 88 to 118) re-enacts with modifications and additions the provisions of Part VIIIA of the Companies Act relating to judicial management. |
| Part 8 (clauses 119 to 216) re-enacts with modifications provisions of Divisions 1 to 4 of Part X of the Companies Act relating to the winding up of companies. |
| Part 9 (clauses 217 to 244) contains provisions applicable in judicial management and winding up, including proof of debts, adjustment of prior transactions, disclaimer of onerous property, and offences. |
| Part 10 (clauses 245 to 250) re-enacts with modifications provisions of Division 5 of Part X of the Companies Act relating to the winding up of unregistered companies (clauses 245 to 249), and contains provisions (clause 250) applicable where a foreign company is in liquidation or dissolution in its place of incorporation. |
| Part 11 (clauses 251 to 253) re-enacts with modifications sections 354A to 354C of the Companies Act to facilitate the resolution of cross‑border insolvency, and to adopt in the Third Schedule (re‑enacting the Tenth Schedule to the Companies Act) the UNCITRAL Model Law on Cross-Border Insolvency, and to clarify its interaction with Singapore insolvency law. |
| Part 12 (clauses 254 to 272) contains general provisions applicable to Parts 4 to 11 of the Bill, and which relate to the Registrar of Companies’ registry and electronic transaction system, the power to grant relief, powers of enforcement, and the prosecution and composition of offences. |
| Part 13 (clauses 273 and 274) covers preliminary matters relating to bankruptcy. |
| Part 14 (clauses 275 to 287) re-enacts with modifications Part V of the Bankruptcy Act relating to voluntary arrangements, which is an alternative to bankruptcy that may be entered into by a debtor with the debtor’s creditors with a view to satisfying his or her debts. |
| Part 15 (clauses 288 to 306) re-enacts with modifications Part VA of the Bankruptcy Act relating to the Debt Repayment Scheme, which gives a debtor who qualifies for the scheme an opportunity to avoid bankruptcy by repaying his or her debts, wholly or in part, in accordance with the scheme. |
| Part 16 (clauses 307 to 325) re-enacts with modifications Part VI of the Bankruptcy Act relating to proceedings in bankruptcy. |
| Part 17 (clauses 326 to 391) re-enacts with modifications Part VII of the Bankruptcy Act relating to the administration and protection of a bankrupt’s estate and the investigation of a bankrupt’s affairs. |
| Part 18 (clauses 392 to 398) re-enacts with modifications Part VIII of the Bankruptcy Act relating to the annulment of a bankruptcy order and discharge of a bankrupt from bankruptcy. |
| Part 19 (clauses 399 to 401) re-enacts with modifications Part IX of the Bankruptcy Act relating to the duties, disqualification and disabilities of a bankrupt. |
| Part 20 (clauses 402 to 418) re-enacts with modifications Part X of the Bankruptcy Act and provides for the offences that can be committed in relation to bankruptcy. |
| Part 21 (clauses 419 to 437) re-enacts with modifications Part XI of the Bankruptcy Act and contains miscellaneous provisions relating to bankruptcy. |
| Part 22 (clauses 438 to 440) contains new provisions against debt avoidance that are applicable in relation to transactions to defraud creditors, and a new provision that limits the exercise of certain contractual rights by reason only that certain proceedings in respect of a company have commenced or that the company is insolvent. |
| Part 23 (clauses 441 to 450) contains miscellaneous and general provisions in the Bill. |
| Part 24 (clauses 451 to 524) contains consequential and related amendments to the Companies Act and certain other Acts. |
| Part 25 (clauses 525 to 527) contains saving and transitional provisions. |
| Clause 1 relates to the short title and commencement. |
| Clause 2 defines certain terms used in the Bill. Clause 2(2) is adapted from section 250 of the UK Insolvency Act 1986, and provides that a person who is not a member of a company, but to whom shares in the company have been transferred, or transmitted by operation of law, is to be regarded as a member of the company. |
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| PART 2JURISDICTION, POWERS AND PROCEDURE OF COURT |
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| Clause 3 confers jurisdiction on the High Court (the Court) in corporate insolvency and winding up, individual insolvency and bankruptcy, and related matters under the Bill. |
| Clause 4 empowers a High Court judge to exercise the Court’s jurisdiction in chambers. |
| Clause 5 deals with the powers of the Registrar of the Supreme Court. |
| Clause 6 places every question arising in any case or matter under the Bill under the general power of the Court, and empowers the Court upon an application by the Official Assignee or the Official Receiver, or on the Court’s own motion, to direct the debtor or bankrupt, or any other person, to comply with an order or direction given under the Bill. |
| Clause 7 empowers the Court to review, rescind or vary any order made by the Court in the exercise of its jurisdiction under the Bill. |
| Clause 8 provides for appeals from any order made by the Court in the exercise of its jurisdiction under the Bill. |
| Clause 9 relates to the criminal jurisdiction of a District Court and a Magistrate’s Court in respect of all offences under the Bill. |
| Clause 10 enables the practice and procedure of the Supreme Court to be followed and adopted if the Bill does not provide for any specific practice or procedure. |
| Clause 11 empowers the Court to adjourn any proceedings at any time. |
| Clause 12 empowers the Court to amend any written process or modify the procedure for any proceedings at any time. |
| Clause 13 empowers the Court to extend the time prescribed for the doing of any act under the Bill. |
| Clause 14 sets out the manner in which evidence may be taken in proceedings under the Bill. |
| Clause 15 provides that the costs of and incidental to any proceedings under the Bill are in the discretion of the Court. |
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PART 3OFFICIAL ASSIGNEE, OFFICIAL RECEIVER AND
INSOLVENCY PRACTITIONERS |
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| Division 1 — Official Assignee and Official Receiver |
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| Clause 16 empowers the Minister to appoint the Official Assignee, Deputy Official Assignee, as well as such number of Senior Assistant Official Assignees and Assistant Official Assignees and such other officers as the Minister thinks necessary for the purposes of carrying into effect Parts 3 and 13 to 23. |
| Clause 17 empowers the Minister to appoint the Official Receiver, Deputy Official Receiver, as well as such number of Senior Assistant Official Receivers and Assistant Official Receivers and such other officers as the Minister thinks necessary for carrying into effect Parts 3 and 4 to 12, 22 and 23. |
| Clause 18 requires notice of the order for removal of the Official Assignee or Official Receiver to be published in the Gazette. |
| Clause 19 specifies the various official names of the Official Assignee and the Official Receiver. |
| Clause 20 empowers the Official Assignee and the Official Receiver to delegate to any person their respective powers or functions under the Bill. |
| Clause 21 deems the Official Assignee and the Official Receiver and any officer appointed by the Minister under clause 16(4) or 17(4) to be public servants within the meaning of the Penal Code. |
| Clause 22 sets out the general duties of the Official Assignee as regards a bankrupt’s conduct and affairs. |
| Clause 23 sets out the general duties of the Official Assignee as regards the estate of a bankrupt. |
| Clause 24 sets out the extent of the Official Assignee’s discretion in the administration of the estate of a bankrupt, and the effect of any direction given by the resolution of creditors of a bankrupt at any general meeting and any advice given by a creditors’ committee. |
| Clause 25 empowers the Official Assignee to administer oaths for the purposes of any matters or proceedings under the Bill. |
| Clause 26 relates to the Official Assignee’s duty to keep an account of the Official Assignee’s receipts and payments in respect of the Official Assignee’s administration of the estate of a bankrupt and in respect of a debt repayment scheme administered under Part 15. |
| Clause 27 relates to the records of proceedings of meetings to be kept by the Official Assignee, and the inspection of those records by creditors. |
| Clause 28 relates to the Official Assignee’s duty to keep — |
| (a) | a Bankruptcy Estates Account into which all moneys received by the Official Assignee under Parts 3, 13, 14 or 16 to 22 must, subject to this Bill, be paid; and | | (b) | a Debt Repayment Schemes Account into which all moneys received by the Official Assignee under Part 15 must, subject to the Bill, be paid. |
| Clause 29 relates to the payment over of surplus funds in the Bankruptcy Estates Account and the Debt Repayment Schemes Account to the Accountant‑General, and the investment of those funds by the Accountant‑General. |
| Clause 30 requires the Official Assignee to furnish a list of a bankrupt’s creditors whenever required by any creditor of the bankrupt and on payment by the creditor of a prescribed fee. |
| Clause 31 relates to the Court’s control and supervision over the Official Assignee. |
| Clause 32 relates to the Minister’s control and supervision over the Official Receiver. |
| Clause 33 relates to the review by the Court of any act, omission or decision of the Official Assignee in the course of the administration of the estate of a bankrupt. |
| Clause 34 provides for any liability of the Official Assignee to be discharged out of the Consolidated Fund. The Official Assignee and any officer of the Official Assignee acting under the Official Assignee’s direction is conferred personal immunity for any act or omission in the exercise of any power, or the performance of any function or duty, under the specified provisions, if the Official Assignee or the officer acted in good faith and with reasonable care. |
| Clause 35 provides for any liability of the Official Receiver to be discharged out of the Consolidated Fund. The Official Receiver and any officer of the Official Receiver acting under the Official Receiver’s direction is conferred personal immunity for any act or omission in the exercise of any power, or the performance of any function or duty, under the specified provisions, if the Official Receiver or the officer acted in good faith and with reasonable care. |
| Division 2 — Trustee in bankruptcy |
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| Clause 36 relates to the appointment of a trustee in bankruptcy and specifies the various official names of the trustee in bankruptcy. A creditor making a bankruptcy application must apply to the Court to appoint a trustee in bankruptcy (who is not the Official Assignee) if — |
| (a) | the creditor is an institutional creditor, a subsidiary of an institutional creditor, or a corporation in respect of which 2 or more institutional creditors together control more than half of the voting power; or | | (b) | the debt upon which the bankruptcy application was made was, when incurred, payable to a person who is an institutional creditor, a subsidiary of an institutional creditor, or a corporation in respect of which 2 or more institutional creditors together control more than half of the voting power. |
| The definition of “institutional creditor” in clause 36(4) is modified from the definition in section 33(3) of the Bankruptcy Act by including a holder of a capital markets services licence granted under section 86 of the Securities and Futures Act (Cap. 289). The definition of “undertaking” in clause 36(4) is modified from the definition in section 33(3) of the Bankruptcy Act by excluding a body established by or under any public Act to perform or discharge a public function. |
| Clause 37 relates to the requirements that must be met before a person may be appointed as a trustee in bankruptcy. |
| Clause 38 requires a trustee in bankruptcy to furnish security before commencing to act as trustee. If the trustee in bankruptcy’s security has been forfeited under clause 42(8), the trustee in bankruptcy must not continue acting until he or she has furnished fresh security. |
| Clause 39 sets out the general functions, duties and powers of a trustee in bankruptcy. Clause 39(3) specifies provisions in the Bill that are not applicable to a trustee in bankruptcy, or that do not apply to a trustee in bankruptcy except with the consent of the Court, the creditors’ committee or, if there is no creditors’ committee, the Official Assignee. |
| Clause 40 requires a trustee in bankruptcy to pay all moneys received by the trustee into such bank account as may be prescribed or as specified by the Court, and makes it an offence for a trustee in bankruptcy to fail to do so. |
| Clause 41 relates to the remuneration of a trustee in bankruptcy. |
| Clause 42 relates to the Official Assignee’s control and supervision over a trustee in bankruptcy. Clause 42(6)(c) gives the Official Assignee a new ground to forfeit the security furnished under clause 38 if the trustee fails to perform any duty apart from those specified in clause 42(6)(a) and (b), or fails to duly observe any other requirement imposed on the trustee by the Bill or any other written law with respect to the performance of the trustee’s duties. |
| Clause 43 relates to the review by the Court of any act, omission or decision of a trustee in bankruptcy in the course of the trustee’s administration of the estate of a bankrupt. |
| Clause 44 sets out the circumstances under which a trustee in bankruptcy may be removed or have his or her office vacated, and the procedure by which a trustee in bankruptcy may resign from his or her office. |
| Clause 45 deals with the duties of the Official Assignee where a vacancy arises in the office of a trustee in bankruptcy. |
| Clause 46 provides for a summary procedure against a trustee in bankruptcy in respect of any loss to a bankrupt’s estate caused by the trustee’s misapplication or retention of property, or misfeasance or breach of duty. It also relieves the trustee from liability in certain circumstances where the trustee seizes or disposes of property not comprised in the bankrupt’s estate. |
| Division 3 — Regulation of insolvency practitioners |
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| Clause 47 sets out when a person acts as an insolvency practitioner. While a person does not act as an insolvency practitioner when acting as a liquidator appointed in a members’ voluntary winding up, or as a scheme manager appointed in relation to a scheme of arrangement, such a person is required to give the Official Receiver written notice of that person’s appointment. |
| Clause 48 makes it an offence to act as an insolvency practitioner without a valid licence to do so. |
| Clause 49 provides for the appointment of the licensing officer and assistant licensing officers. |
| Clause 50 sets out the persons who are eligible to be granted, to hold or continue to hold an insolvency practitioner’s licence. |
| Clause 51 relates to the application for the grant or renewal of a licence. In deciding whether or not to grant or renew the licence, the licensing officer must consider certain matters which include whether the applicant is, in the opinion of the licensing officer, a fit and proper person to hold a licence. In determining whether a person is a fit and proper person, the licensing officer may take into account any matter the licensing officer considers relevant. |
| Clause 52 empowers the licensing officer to impose conditions when granting or renewing a licence. These conditions may be applicable to — |
| (a) | all licensees; | | (b) | a specified class of licensees; or | | (c) | a specified licensee only. |
| Clause 52 also deals with the modifications of the conditions of a licence by the licensing officer. Before making any modification, the licensing officer must give notice to the licensee. The licensee is given an opportunity to make written representations with respect to the proposed modification. The licensing officer may subsequently issue a direction to the licensee to give effect to the modification as specified in the notice earlier given to the licensee. |
| Clause 53 relates to the form and validity of a licence. |
| Clause 54 relates to the register of licensed insolvency practitioners. |
| Clause 55 relates to the circumstances when the licensee must not act as an insolvency practitioner. |
| Clause 56 deals with the revocation, cancellation or suspension of a licence. The licensing officer may revoke a licence on the grounds specified in clause 56(1). The licensing officer may, in any case in which the licensing officer considers that no cause of sufficient gravity for revoking any licence exists, suspend the licence, direct the licensee to pay a penalty, censure the licensee or modify any condition of the licence or impose such other conditions as the licensing officer considers appropriate. |
| Clause 57 sets out the powers exercisable by the licensing officer for the purposes of investigating whether any licensee has breached or contravened any requirement under the Bill or condition of the licence, and how those powers are to be exercised. The powers include the power to require any licensee to provide any document or information specified in a written notice. The clause makes it an offence to fail to comply with the requirement imposed on the person by the licensing officer, but it is a defence to a charge of failing to produce a document if the person proves that the document was not in the person’s possession or control, and the person had a reasonable excuse for failing to comply with the requirement. |
| Clause 58 confers on the licensing officer the power to issue written directions if the licensing officer thinks it necessary or expedient for the purposes of administration of Division 3 of Part 3. Any person who contravenes any requirement specified in a written direction under the clause commits an offence. |
| Clause 59 provides that the following persons may appeal to the Minister, whose decision is final: |
| (a) | any person whose application for the grant or renewal of a licence has been refused by the licensing officer; | | (b) | any licensee whose licence is granted or renewed subject to conditions, or where any condition is added or varied by the licensing officer under clause 52(3); | | (c) | any licensee in respect of whom any order under clause 56(1) or (2) has been made. |
| Clause 60 empowers the licensing officer to compound any offence under Division 3 of Part 3 that is prescribed as a compoundable offence. |
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PART 4CORPORATE INSOLVENCY, RESTRUCTURING AND
DISSOLUTION — PRELIMINARY |
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| Clause 61 provides for the interpretation of Parts 4 to 12. |
| Clause 62 sets out matters constituting affairs of the company. |
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| PART 5SCHEME OF ARRANGEMENT |
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| Clause 63 provides that Part 5 only applies in a compromise or an arrangement between a company and its creditors (or a class of creditors), and does not apply to a compromise or an arrangement between a company and its members. Clause 63(3) empowers the Minister to prescribe by order in the Gazette that a specified company or class of companies is excluded from the meaning of “company” for the purposes of Part 5. |
| Clause 64 gives the Court the power to make one or more orders restraining certain actions and proceedings against the company (a moratorium), on an application by a company that has proposed a compromise or an arrangement with its creditors, or intends to do so. |
| Clause 65 gives the Court the power to grant a similar moratorium in favour of the subsidiary, holding company or an ultimate holding company of a company in respect of which a moratorium under clause 64 is in force. |
| Clause 66 enables a creditor to apply to the Court to make an order restraining certain disposals of property of, or a transfer of shares in, a company in respect of which a moratorium under clause 64(1) or 65(1) or an automatic moratorium under clause 64(8) is in force. |
| Clause 67 provides that where a company has made an application under section 210(1) of the Companies Act or clause 64(1), the Court has the power to order that debt arising from any rescue financing obtained or to be obtained by the company is to have priority over some or all of the preferential debts specified in clause 203(1), or is to be secured by a security interest, as described in clause 67(1)(a), (b), (c) and (d). |
| Clause 68 provides a statutory framework for the filing, inspection and adjudication of proofs of debt filed by creditors for the purpose of identifying creditors who are entitled to vote at the meeting summoned pursuant to an order under section 210(1) of the Companies Act, and provides for the appointment and role of an independent assessor. |
| Clause 69 provides that the Court hearing an application for the Court’s approval of a compromise or an arrangement under section 210(4) of the Companies Act, may order the company to hold another meeting of the creditors for the purpose of putting the compromise or arrangement to a re‑vote. |
| Clause 70 provides that despite the fact that the conditions in section 210(3AB)(a) and (b) of the Companies Act are not satisfied in respect of at least one class of creditors (dissenting class), the Court is given the power to ‘cram down’ the dissenting class or classes of creditors by approving the compromise or arrangement and ordering that the compromise or arrangement be binding on the company and all classes of creditors meant to be bound by the compromise or arrangement, if certain conditions under the clause are met. |
| Clause 70(4) sets out the minimum requirements that a compromise or an arrangement must meet in order for it to be considered fair and equitable to a dissenting class for the purposes of clause 70(3)(c). Clause 70(4)(b)(ii)(B) re‑enacts with modification section 211H(4)(b)(ii)(B) of the Companies Act and provides that the terms of distribution to the company’s creditors under the compromise or arrangement only extends to the property of the company, and not to other property owned by the members of the company, such as shares of the company. |
| Clause 71 gives the Court the power to approve a compromise or an arrangement proposed by a company without a meeting of the creditors being ordered to be summoned under section 210(1) of the Companies Act or held by the company. Section 211I(5) and (7) of the Companies Act is re‑enacted not in clause 71, but in new section 40A of the Monetary Authority of Singapore Act inserted by clause 492(a). |
| Clause 72 applies after a compromise or an arrangement between a company and its creditors has been approved by the Court under section 210(4) of the Companies Act or clause 71(1). Clause 72 enables the company, the scheme manager or a creditor bound by the scheme of arrangement to apply to the Court for certain orders, directions or clarifications. The Court may reverse or modify an act or decision of the company or scheme manager that results in a breach of a term of the scheme of arrangement, or give directions or make any order to rectify the act, omission or decision of the company or scheme manager. |
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| PART 6CORPORATE INSOLVENCY — RECEIVERSHIP |
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| Clause 73 sets out the application of Part 6. Clause 73(2) requires every person who is appointed outside Singapore as receiver or manager of the property in Singapore of a corporation to lodge a notice of appointment with the Registrar of Companies, before acting as receiver or manager of the property in Singapore of that corporation. Clause 73(3) provides that upon lodgment of the notice in clause 73(2), clauses 75 to 78, 81(2) and (3), 82 and 85 to 87 apply to the person and the corporation mentioned in clause 73(2). |
| Clause 74 disqualifies certain persons from acting as a receiver or manager of the property of a company, or of the property in Singapore of a corporation. |
| Clause 75 gives effect to Recommendation 4.2(c) in the Insolvency Law Review Committee Report. |
| Clause 75(1) applies the clause to any receiver or manager entering into possession of any property of a company, or of any property in Singapore of a corporation, for the purpose of enforcing any charge or other security. |
| Clause 75(2) provides that the receiver or manager mentioned in clause 75(1) is personally liable on any contract entered into by that person in the performance of that person’s functions (except insofar as the contract otherwise provides) and, to the extent of any qualifying liability (as defined in clause 75(5)), on any contract of employment adopted by that person. Clause 75(2) provides that such a person is entitled to an indemnity out of the property of the company or corporation. |
| Clause 75(4) provides that when the receiver or manager vacates office, the remuneration of the receiver or manager, any expenses properly incurred, and any indemnity to which the receiver or manager is entitled, are to be charged on and paid out of the property of the company or corporation, in priority to any charge or other security held by the person by whom or on whose behalf the receiver or manager was appointed. |
| Clause 76 provides that the Court may, on an application for directions under the clause, give such directions or make such orders as the Court thinks just. |
| Clause 77 provides that where a person is invalidly appointed as a receiver or manager, the appointing party may be ordered to indemnify the person appointed against any liability that arises solely by reason of the invalidity of the appointment. |
| Clause 78 provides for the power of the Court to fix the remuneration of a receiver or manager. Clause 78(1) allows the company or corporation, the liquidator of the company or corporation or the person who appointed the receiver or manager, to apply to the Court for an order fixing the remuneration of the receiver or manager. |
| Clause 79 provides that the Court has the power to appoint the liquidator of a company or corporation as the receiver or manager of the property of the company or of the property in Singapore of that corporation. |
| Clause 80 sets out rules relating to the time at which the appointment of a receiver or manager, by order or by instrument, takes effect. |
| Clause 81 provides that the notice of appointment or cessation of appointment of a receiver or manager must be lodged with the Official Receiver and the Registrar of Companies. |
| Clause 82 extends the requirement to include a statement that a receiver or manager has been appointed, to every Internet website of the company or corporation on or in which the name of the company or corporation appears. |
| Clause 83 contains provisions as to information to be provided where a receiver or manager is appointed. |
| Clause 84 contains provisions relating to the statement of affairs of a company or corporation required to be submitted to a receiver or manager. |
| Clause 85 relates to the lodging of accounts of receivers or managers. The Official Receiver may, of the Official Receiver’s own motion, or on the application of the company or corporation, or a creditor of the company or corporation, cause the accounts to be audited by a public accountant. |
| Clause 86 provides for the payment of certain debts out of property subject to a floating charge, in priority to claims in respect of debentures secured by that charge. |
| Clause 87 relates to the enforcement of the duty of a receiver or manager to lodge a document or give a notice, or to make repayment, restoration or contribution in certain circumstances. |
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| PART 7JUDICIAL MANAGEMENT |
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| Clause 88 provides for the interpretation of Part 7. |
| Clause 89 sets out the purposes of judicial management (currently found in section 227B(1)(b) of the Companies Act), and the functions of a judicial manager or an interim judicial manager. |
| Clause 90 provides that a company or any creditor of the company that is, or is likely to become, unable to pay its debts, may apply to the Court for an order that the company be placed under the judicial management of a judicial manager if it is considered that there is a reasonable probability of rehabilitating the company or of preserving all or part of its business as a going concern or the interests of the creditors would be better served otherwise than by resorting to a winding up. |
| Clause 91 provides that the Court may, on an application for a judicial management order, order that the company be placed under the judicial management of a judicial manager, if the Court is satisfied that the company is or is likely to become unable to pay its debts, and the Court considers that the making of the order would be likely to achieve one or more of the purposes of judicial management mentioned in clause 89(1). |
| Clause 92 provides that the Court may appoint an interim judicial manager. |
| Clause 93 enables a creditor to apply to the Court for an order restraining certain disposals of property of, or a transfer of shares in, a company at any time during the period between the making of a judicial management application and the determination of the application. |
| Clause 94 gives effect to Recommendation 6.5 of the Insolvency Law Review Committee Report by providing for a new process for a company to obtain a resolution of its creditors for the company to be placed under the judicial management of a judicial manager. A company may obtain such a resolution of its creditors where the company considers that the company is, or is likely to become, unable to pay its debts, and there is a reasonable probability of achieving one or more of the purposes of judicial management mentioned in clause 89(1). |
| Clause 95 sets out the effect of an application for a judicial management order or the lodgment of a written notice of appointment of an interim judicial manager under clause 94(5)(a). |
| Clause 96 provides that, when a company enters judicial management, any receiver, or receiver and manager, must vacate office, and any application for the winding up of the company must be dismissed. During the period in which a company is in judicial management, the company cannot be wound up, no receiver or manager may be appointed, and certain actions and proceedings against the company are restrained except with the consent of the judicial manager or with the leave of the Court. |
| Clause 97 extends the requirement to include a statement that the company is being managed by a judicial manager or an interim judicial manager, to every Internet website of the company on or in which the name of the company appears. |
| Clause 98(1) enables the Court to fill a vacancy of a judicial manager or interim judicial manager appointed by the Court. Clause 98(2) allows creditors to fill any vacancy in the office of a judicial manager who was appointed under clause 94. |
| Clause 99 provides that the judicial manager has the powers specified in the First Schedule (which re‑enacts the Eleventh Schedule to the Companies Act). A new paragraph (f) is inserted in the First Schedule to empower the judicial manager to assign proceeds of an action arising under clause 224, 225, 228, 238, 239 or 240. This is to facilitate third‑party funding of such actions by the judicial manager. Clause 99(6)(c) and (d) sets out 2 new circumstances (additional to those in existing section 227G(6) of the Companies Act) in which the judicial manager may make payments towards discharging pre‑judicial management debts without the need to seek the leave of the Court. |
| Clause 100 enables the judicial manager to dispose of or otherwise exercise the judicial manager’s powers in relation to certain property of the company which is subject to a security, as if the property were not subject to the security. |
| Clause 101 provides that when a company is in judicial management, the Court may order that debt arising from any rescue financing obtained or to be obtained by the company is to have priority over some or all of the preferential debts specified in clause 203(1), or is to be secured by a security interest, as described in clause 101(1)(a), (b), (c) and (d). |
| Clause 102 provides that the judicial manager of a company is deemed to be the agent of the company, but omits the personal liability provision in section 227I(1)(b) of the Companies Act (pursuant to Recommendation 6.8 of the Insolvency Law Review Committee Report). |
| Clause 103 provides that during the period in which a company is in judicial management, the requirements to call an annual general meeting and to file annual returns and audited accounts are suspended. |
| Clause 104(1) provides that the judicial manager may be removed from office by the Court and may resign with the leave of the Court. Clause 104(5) provides that where the office of a judicial manager has been vacated, the Court may appoint another licensed insolvency practitioner as judicial manager of the company. |
| Clause 105 requires the judicial manager to provide information to various stakeholders concerning the company’s entry into judicial management. |
| Clause 106 requires the relevant persons mentioned in the clause to submit to the judicial manager a statement as to the affairs of the company. |
| Clause 107 requires the judicial manager, within 90 days after the company’s entry into judicial management, to send to the Registrar of Companies and the creditors a statement of the judicial manager’s proposals for achieving one or more of the purposes of judicial management mentioned in clause 89, and to lay a copy of the statement before a meeting of creditors. Clause 107 provides that an extension of the 90‑day period may be obtained from the creditors, as well as the Court. |
| Clause 108 requires the judicial manager to report to the Court the result of the meeting summoned under clause 107 and to give notice of the result of the meeting to the Registrar of Companies and to such others as the Court may approve. |
| Clause 109 enables the meeting of creditors summoned under clause 107 to establish a committee to oversee the carrying out of the judicial manager’s functions. |
| Clause 110 provides that the judicial manager is under a duty to manage the company in accordance with the proposals approved by the meeting of creditors. The judicial manager cannot make substantial revisions to the proposals unless the revisions are approved by a meeting of creditors as described in the clause. |
| Clause 111 provides that the term of a judicial manager’s appointment is a period of 180 days starting on either the date of the making of the judicial management order, or the date of the approval of the judicial manager’s appointment at the meeting of creditors under clause 94(11)(e) (as the case may be). Further, the clause allows for this term of office to be extended by the creditors or the Court. |
| Clause 112 requires the judicial manager to apply to the Court for the company to be discharged from judicial management, based on the circumstances specified in the clause. |
| Clause 113 provides that where a former judicial manager did not obtain the necessary approval from the Court or committee of creditors for his or her remuneration and expenses before ceasing to be a judicial manager, the person may apply to the Court for approval of the former judicial manager’s remuneration and expenses. Clause 113 supersedes the Official Receiver’s Practice Circular 1 of 2016. |
| Clause 114 relates to the order of priority for expenses of a judicial manager and an interim judicial manager. The debts incurred by the judicial manager or interim judicial manager on behalf of the company (including rescue financing obtained under clause 101) have priority over the remuneration or expenses of the judicial manager. |
| Clause 115 enables a creditor or member of the company to apply to the Court for an order to protect the interests of the creditors or members based on various grounds specified in the clause, including the following new grounds: |
| (a) | a judicial management under clause 94 should not have been commenced at all; | | (b) | there are no proper grounds for continuing the judicial management, in that either one or more of the purposes of judicial management have been achieved or none of the purposes of judicial management are capable of achievement; | | (c) | that the judicial manager is not managing the company in accordance with the proposals which had been approved by a meeting of creditors summoned under clause 107. |
| Clause 116 enables a recognised trade union to act on behalf of members of the union who, being employees of the company, are creditors of the company in respect of wages or salary due to those employees. |
| Clause 117 enables a judicial manager to apply to the Court to propose a compromise or an arrangement between the company and its creditors. |
| Clause 118 provides for the company’s transition from judicial management to liquidation where the judicial manager makes a winding up application. |
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| Division 1 — Preliminary provisions applicable to winding up |
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| Clause 119 sets out the modes of winding up. |
| Clause 120 provides that certain provisions relating to the remedies against the property of a company, the priorities of debts, and the effect of an arrangement with creditors, bind the Government. |
| Clause 121 relates to the liability of present and past members as contributories, and the liability of a director whose liability is unlimited. |
| Clause 122 relates to the nature of the liability of a contributory. |
| Clause 123 addresses liability to contribute in the case of the death or bankruptcy of a contributory. |
| Division 2 — Provisions applicable to winding up by Court |
| | Subdivision (1) — General |
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| Clause 124 relates to an application to wind up a company. Clause 124(1)(b) is new, and allows a single director of a company to apply to wind up the company, upon establishing to the satisfaction of the Court a prima facie case for winding up, and obtaining the leave of the Court. |
| Clause 125 sets out the circumstances in which a company may be wound up by the Court. Clause 125(2)(a) increases the debt threshold for deeming a company to be unable to pay its debts to $15,000, from the current threshold of $10,000 set out in section 254(2)(a) of the Companies Act. Clause 125(7) empowers the Minister to prescribe, by order, a different debt threshold from that specified in clause 125(2)(a). |
| Clause 126 relates to the commencement of winding up. |
| Clause 127 relates to the payment of preliminary costs incurred prior to the appointment of a liquidator under Part 8. Clause 127(2) provides that the liquidator must reimburse the applicant, out of the assets of the company, the costs incurred by the applicant in the winding up application (whether taxed or agreed), subject to any order of the Court. |
| Clause 128 empowers the Court to make certain orders on hearing a winding up application. |
| Clause 129 empowers the Court to stay or restrain proceedings against the company, at any time after the making of a winding up application and before a winding up order has been made. |
| Clause 130 relates to the avoidance of dispositions of property and certain attachments. |
| Clause 131 provides that any winding up application constitutes a lis pendens. |
| Clause 132 provides, amongst other things, that the applicant for the winding up order must lodge a notice of the winding up order and a copy of the winding up order with the Official Receiver and the Registrar of Companies. |
| Clause 133 relates to the effect of a winding up order or the appointment of a provisional liquidator. |
| Subdivision (2) — Liquidators |
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| Clause 134(a) provides that the Court may appoint a licensed insolvency practitioner or (where the Official Receiver consents) the Official Receiver to be the liquidator. Under clause 134(f), the Official Receiver may appoint one or more licensed insolvency practitioners to act as the provisional liquidator or liquidator in place of the Official Receiver. Clause 134(g) provides that the appointment of any licensed insolvency practitioner as a provisional liquidator or liquidator under clause 134(f) does not take effect until that person agrees to be so appointed. |
| Clause 135 relates to the nomination and consent of the liquidator. Clause 135(3) provides that the applicant of a winding up application may nominate the Official Receiver to be appointed as liquidator if the applicant has taken reasonable steps but is unable to obtain the consent of a licensed insolvency practitioner to be appointed as liquidator, and the Official Receiver consents to being nominated to be appointed as liquidator. |
| Clause 136 relates to circumstances where a person other than the Official Receiver is appointed liquidator. |
| Clause 137 provides for the control of liquidators by the Official Receiver. |
| Clause 138 empowers the Court to appoint the Official Receiver or a licensed insolvency practitioner as a provisional liquidator, and sets out the procedural requirements for that purpose. |
| Clause 139 contains the general provisions as to liquidators. |
| Clause 140 provides for the custody and vesting of the company’s property. |
| Clause 141 requires the statement of the company’s affairs to be submitted to the Official Receiver or the liquidator, as the case may be. |
| Clause 142 empowers the Official Receiver or the liquidator to require a statement of concurrence verified by affidavit to be submitted by certain persons. |
| Clause 143 provides that the liquidator must as soon as practicable after receipt of the statement of affairs submit a preliminary report to the Court or the Official Receiver, as the case requires. |
| Clause 144 sets out the powers of the liquidator. Clause 144(1) provides that the powers of the liquidator under that provision may be exercised only after authorisation by either the Court or the committee of inspection. Clause 144(1)(e) and (f)(ii) provides that prior authorisation by either the Court or the committee of inspection is required, before bringing or defending any action or other legal proceeding in the name and on behalf of the company, or before appointing a solicitor for that purpose. This is a change from the existing position in section 272(2)(a) of the Companies Act where prior authorisation by either the Court or the committee of inspection is not required for that purpose. Clause 144(1)(g) provides that the liquidator may assign, in accordance with the regulations, the proceeds of an action arising under clause 224, 225, 228, 238, 239 or 240. This is to facilitate third‑party funding of such actions by the liquidator. |
| Clause 145 relates to the exercise and control of the liquidator’s powers. |
| Clause 146 requires the liquidator to pay money received by the liquidator into a bank account in accordance with the regulations. |
| Clause 147 provides that the liquidator may apply to the Court for an order that the liquidator be released and that the company be dissolved, in certain circumstances. |
| Clause 148(1) provides that before making an application under clause 147, the liquidator must call a meeting of the company and creditors, for the purpose of laying before them an account of the winding up of the company. Clause 148(3) requires the liquidator to lodge with the Registrar of Companies and the Official Receiver a return of the holding of the meeting, with a copy of the account attached to the return. |
| Clause 149 relates to the release of a liquidator and dissolution of a company. Clause 149 provides that the Court may cause a report on the accounts of a liquidator to be prepared, and must consider the report and any objection against the release of the liquidator, before granting the release of the liquidator. |
| Subdivision (3) — Committees of inspection |
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| Clause 150 relates to the summoning of meetings to determine whether a committee of inspection is to be appointed. |
| Clause 151 relates to the constitution and proceedings of a committee of inspection. |
| Subdivision (4) — General powers of Court |
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| Clause 152 relates to the settlement of the list of contributories, and the collection and application of the assets of the company in discharge of the liabilities of the company. |
| Clause 153 empowers the Court to make certain orders regarding the payment of money due from a contributory. |
| Clause 154 empowers the Court to appoint a special manager of the estate or business of a company. |
| Clause 155 contains provisions relating to the claims of creditors and distribution of property. |
| Clause 156 empowers the Court to make such order for inspection of the books and papers of the company by creditors and contributories as the Court thinks just. |
| Clause 157 empowers the Court to cause an absconding contributory, director or former director to be arrested, and the books and papers and movable personal property of such person to be seized and safely kept. |
| Clause 158 relates to the delegation of certain powers and duties conferred and imposed on the Court to be exercised or performed by the liquidator as an officer of the Court and subject to the control of the Court. |
| Clause 159 provides that the powers conferred on the Court by the Bill or the Companies Act are cumulative. |
| Division 3 — Provisions applicable to voluntary winding up |
| | Subdivision (1) — Preliminary |
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| Clause 160 sets out the circumstances in which a company may be wound up voluntarily. |
| Clause 161 provides for the appointment of a provisional liquidator on a statutory declaration being lodged with the Official Receiver and a declaration lodged with the Registrar of Companies that the company cannot, by reason of its liabilities, continue its business and on a meeting of the company and of its creditors having been summoned. |
| Clause 162 contains provisions relating to the effect of the voluntary winding up. |
| Clause 163 contains provisions relating to the making of a declaration of solvency by the directors of the company. |
Subdivision (2) — Provisions applicable only to
members’ voluntary winding up |
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| Clause 164 contains provisions relating to the appointment of a liquidator in a members’ voluntary winding up. |
| Clause 165 relates to the duty of the liquidator to call a creditors’ meeting, and sets out alternative provisions as to annual meetings, if the liquidator is of the opinion that the company is insolvent. |
Subdivision (3) — Provisions applicable only to
creditors’ voluntary winding up |
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| Clause 166 relates to the summoning of a meeting of the creditors of the company. |
| Clause 167 relates to the nomination and appointment of a liquidator in a creditors’ voluntary winding up. |
| Clause 168 empowers a liquidator to require other directors of a company to make a statement of concurrence in respect of the statement of affairs that is laid before the creditors at the creditors’ meeting in clause 166. |
| Clause 169 relates to the appointment of a committee of inspection. |
| Clause 170 voids any attachment, sequestration, distress or execution against the estate of the company after the commencement of a creditors’ voluntary winding up, and bars the commencement or continuation of any action or proceeding against the company except by the leave of the Court. |
Subdivision (4) — Provisions applicable to
every voluntary winding up |
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| Clause 171 relates to the exercise of powers conferred on a provisional liquidator, before the holding of the meeting of creditors under clause 166. |
| Clause 172 relates to the distribution of the property of the company. |
| Clause 173 empowers the Court to appoint a liquidator if there is no liquidator acting. |
| Clause 174 empowers the Court to remove a liquidator and appoint another liquidator. |
| Clause 175 provides for the review by the Court of the amount of remuneration of a liquidator. |
| Clause 176 relates to the validity of the acts of liquidators. |
| Clause 177(1)(a) refers to the modified set of liquidator’s powers as set out in clause 144(1). |
| Clause 178 relates to the power of the liquidator to accept shares or debentures in, or participation in the profits of, a corporation as consideration for the sale of the business or property of the company in liquidation to the corporation. |
| Clause 179 requires the liquidator to summon an annual meeting of the company or of the company and the creditors (as the case requires) if the winding up continues for more than one year. |
| Clause 180(1) provides that as soon as the affairs of the company are fully wound up, the liquidator must call a meeting of the company or of the company and creditors (as the case requires), for the purpose of laying before the meeting an account of the winding up of the company. Clause 180(3) requires the liquidator to lodge with the Registrar of Companies and the Official Receiver a return of the holding of the meeting, with a copy of the account attached to the return. |
| Clause 181 provides that the liquidator or any contributory or creditor may apply to the Court to determine any question arising in the winding up, or to exercise any power that the Court might exercise, if the company were being wound up by the Court. |
| Clause 182 provides that the powers of the directors must not be exercised without sanction of the Court (with some exceptions), where it is proposed to wind up a company voluntarily, and no liquidator or provisional liquidator has been appointed or nominated by the company. |
| Clause 183 provides that all proper costs, charges and expenses of and incidental to the winding up are payable out of the assets of the company. |
| Clause 184 provides that where there is a pending application to wind up a company, the company must not, without the leave of the Court, resolve that it be wound up voluntarily. |
| Clause 185 relates to the summoning, proof of notice, and quorum of meetings. |
| Division 4 — Provisions applicable to every mode of winding up |
| | Subdivision (1) — General |
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| Clause 186(1) provides that the Court may stay or terminate a winding up. Clause 186(3) provides that the Court, after making an order to terminate the winding up, may give directions for the resumption of the management and control of the company by its officers. Clause 186 is intended to address the issues raised by the High Court in paragraphs 25 and 26 of its judgment in Interocean Holdings Group (BVI) Ltd v Zi-Techasia (Singapore) Pte Ltd (in liquidation) [2014] SGHC 9. |
| Clause 187 relates to when an arrangement, entered into between a company about to be or being wound up and its creditors, is binding on the company and its creditors. Currently, section 309 of the Companies Act is applicable only to a company in voluntary winding up, whereas clause 187 is applicable to every mode of winding up. |
| Clause 188 provides for books to be kept by the liquidator and for their inspection by any creditor or contributory. Clause 188 also vests control over the activities of liquidators in the Court. |
| Clause 189 gives the Official Receiver specific powers to act where there is no committee of inspection. |
| Clause 190 allows any person aggrieved by the liquidator’s act or decision to apply to the Court. |
| Clause 191 requires the liquidator to provide notice of the liquidator’s appointment and the address of the liquidator’s office to the Registrar of Companies and the Official Receiver. |
| Clause 192 requires every liquidator to lodge with the Official Receiver an account of the liquidator’s receipts and payments and a statement of the position in the winding up at certain times. The accounts to be lodged under the clause are separate from and are in addition to the final accounts to be lodged under clause 148 or 180. |
| Clause 193 empowers the Court to order a liquidator to make good any default in lodging or making any application, return, account or other document, or in giving any notice, that the liquidator is by law required to lodge, make or give. |
| Clause 194 extends the requirement to include a statement that the company is in liquidation, to every Internet website of the company on or in which the name of the company appears. |
| Clause 195 relates to the requirement to retain books and papers of a company and of its liquidator, where the company is being wound up. |
| Clause 196 allows the liquidator to invest any surplus funds in excess of the amount required for the time being to answer demands in respect of the estate of the company in the manner specified in the clause. |
| Clause 197 allows a liquidator to pay any unclaimed moneys to the Official Receiver, and requires the liquidator, before making the payment, to give notice of the intended payment to the person entitled to those moneys. |
| Clause 198 empowers the Court, upon a company being wound up on the ground that it is being used for purposes against national security or interest, to order the residual assets of the company to be paid into the Consolidated Fund. |
| Clause 199 provides that a liquidator is not liable to incur any expense in relation to the winding up of a company unless there are sufficient available assets. |
| Clause 200 provides that a resolution passed at an adjourned meeting of creditors or contributories of a company is treated as having been passed on the date it was in fact passed. |
| Clause 201 empowers the Court to direct meetings of creditors or contributories to ascertain the wishes of the creditors or contributories. |
| Clause 202 establishes commissioners to take evidence for the examination of witnesses referred by the Court. |
| Clause 203 sets out the order of priority in which proved debts are to be paid in a winding up. |
| Clause 204 provides that the Court may make an order with respect to the distribution of assets recovered, protected or preserved to give an advantage to a creditor who runs certain risks for purposes of recovering, protecting or preserving those assets. |
| Subdivision (2) — Effect on other transactions |
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| Clause 205 provides that any transfer or assignment by a company of all its property to trustees for the benefit of its creditors is void, except in the circumstances specified in the clause. |
| Clause 206 addresses the situation where a creditor has issued execution against the property of a company which is subsequently wound up. Clause 206 deprives the creditor of the benefit of the execution, unless such execution was completed before the commencement of winding up. |
| Clause 207 sets out the duties of the bailiff in respect of goods of a company taken in execution. |
| Subdivision (3) — Dissolution |
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| Clause 208 empowers the Court to declare the dissolution of a company void, regardless whether the company is dissolved pursuant to the Bill or other written law. |
| Clauses 209 to 211 are new provisions adapted from section 344(2) and (4) of the Companies Act and sections 202 and 203 of the UK Insolvency Act 1986. A liquidator who believes that the realisable assets of the company are insufficient to cover the expenses of the winding up and that the affairs of the company do not require further investigation, may give notice to the creditors and contributories that the name of the company will be struck off the register and the company will be dissolved after 30 days unless the creditors or contributories appoint another liquidator or an order of Court under clause 211 is obtained. |
| Clause 212 empowers the Official Receiver to act as a representative of a dissolved company (whether it is dissolved pursuant to the Bill or other written law) to do certain administrative acts which the company would be bound to do, if the company had not been dissolved. |
| Clause 213 vests any outstanding property of a company that has been dissolved (whether it is dissolved pursuant to the Bill or other written law) in the Official Receiver. |
| Clause 214 provides for the disposal of the outstanding property of a dissolved company and the ultimate disposal of the proceeds of such property, as if they were unclaimed moneys. |
| Clause 215 relates to the liability of the Official Receiver to pay charges, claims and liabilities affecting property of dissolved companies vested in the Official Receiver. |
| Clause 216 provides for proper accounts to be maintained by the Official Receiver of the receipts and payments in respect of property of dissolved companies vested in the Official Receiver. |
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PART 9PROVISIONS APPLICABLE IN JUDICIAL
MANAGEMENT AND WINDING UP |
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| Clause 217 provides for interpretation of Part 9. Clause 217(1) provides definitions for “commencement of the judicial management” and “commencement of the winding up” for the purposes of clauses 224 to 229. This definition of “commencement of the winding up” differs from the interpretation provided in clause 126 in the case of a winding up by the Court, and in clause 161(6) in the case of a voluntary winding up. |
| Clause 217(2)(b) also introduces the concept of a person connected with a company, adapting from section 249 of the UK Insolvency Act 1986. Clause 217(3) to (15) provides the meaning of “associate” to determine whether a person is connected with a company, adapting from section 435 of the UK Insolvency Act 1986. |
| Division 2 — Proof of debts |
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| Clause 218 sets out the debts that are provable in judicial management or winding up. |
| Clause 219 provides that where there have been mutual dealings between a company and any creditor, the mutual debts and liabilities are to be set off, and only the balance is a debt provable in the judicial management or the insolvent winding up of the company. |
| Clause 220 requires observance of the prescribed regulations relating to proof of debts. |
| Clause 221 empowers the Court to discharge obligations under a contract between a party and a company that subsequently enters judicial management or goes into insolvent winding up, on such terms as appears to the Court to be equitable. |
| Clause 222 relates to interest allowed on debts of a company in judicial management or insolvent winding up. |
| Clause 223 provides that a secured creditor is not entitled to interest on the secured debt if the security is not realised within 12 months after the commencement of winding up or after obtaining leave to enforce security under clause 96(4)(e). |
| Division 3 — Adjustment of prior transactions |
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| Clauses 224 to 227 enable the Court, on the application of the judicial manager or liquidator of a company, to make orders for restoring the position to what it would have been had the company not entered into a transaction at an undervalue or given an unfair preference to a creditor. |
| Clause 228 enables the Court, on the application of the judicial manager or liquidator of a company, to vary or set aside any extortionate credit transaction between the company and a creditor. |
| Clause 229 provides that a floating charge on a company’s property created at a relevant time is invalid to the extent specified in the clause. |
| Division 4 — Disclaimer of onerous property |
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| Clauses 230 to 233 provide that the judicial manager or liquidator of a company may disclaim onerous property, and empower the Court to make certain orders where a judicial manager or liquidator has disclaimed property. |
| Clause 234 sets out offences that an officer or contributory of a company that is in judicial management or winding up, may be liable for. |
| Clause 235 provides that an offer of an inducement to secure an appointment as judicial manager or liquidator is an offence. |
| Clause 236 provides that an officer or contributory of a company that is in judicial management or winding up, who destroys, mutilates or falsifies any books or papers, commits an offence. |
| Clause 237 provides that an officer who is in default commits an offence where proper books of account are not kept by a company. |
| Clause 238 enables the Court, on the application of the judicial manager, liquidator, or any creditor or contributory of the company, to declare any knowing party to be personally responsible for the debts or liabilities of the company, where it appears that any business of the company was carried on to defraud creditors or for any fraudulent purpose. |
| Clause 239 is a new provision adapted from section 340 of the Companies Act and the draft provision set out at paragraph 1806 of the Report of the UK Review Committee, Insolvency Law and Practice (Cmnd 8558, 1982, commonly known as the “Cork Report”). Clause 239 replaces sections 339(3) and 340(2) of the Companies Act, where criminal liability is a prerequisite to the making of an application to impose civil liability on an officer of the company. Clause 239 empowers the Court to make a declaration that any person who was a knowing party to the company trading wrongfully is personally responsible for debts or liabilities of the company. Clause 239(10) and (11) provides that a company or any person party to, or interested in becoming party to, the carrying on of business with a company, may apply to the Court for a declaration that a particular course of conduct, transaction or series of transactions would not constitute wrongful trading. A company trades wrongfully if the company incurs debt or liabilities without reasonable prospect of meeting them in full when the company is insolvent, or becomes insolvent as a result of the incurrence of such debt or liability. |
| Clause 240 empowers the Court to examine the conduct of a judicial manager, liquidator or officer of a company who has been guilty of misfeasance, breach of trust or duty in relation to the company. |
| Clause 241 relates to the prosecution of any past or present officer, or any member of the company. |
| Division 6 — Management by judicial managers and liquidators |
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| Clause 242(1) provides that the Court may require any person to surrender to the judicial manager or liquidator any property, books, papers or records to which the company appears to be entitled. |
| Clause 243 imposes on specified persons connected with the company a duty to cooperate with the judicial manager, liquidator or Official Receiver. |
| Clause 244 empowers the Court to examine persons as to the affairs of a company that is in judicial management or is being wound up. Such an examination may be held in public, if the Court so directs. |
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PART 10WINDING UP OF UNREGISTERED COMPANIES AND
LIQUIDATION OR DISSOLUTION OF FOREIGN COMPANIES |
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| Division 1 — Winding up of unregistered companies |
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| Clause 245 defines “unregistered company” for the purposes of Division 1 of Part 10, and provides that the provisions of Division 1 are in addition to other provisions with respect to the winding up of companies. |
| Clause 246 provides for the winding up of unregistered companies. Clause 246(1)(d) provides that where the unregistered company is a foreign company, it may be wound up only if it has a substantial connection with Singapore. Clause 246(5) empowers the Minister to prescribe, by order, a different debt threshold from that specified in clause 246(2)(a). |
| Clause 247 relates to the liability of contributories in the winding up of an unregistered company. |
| Clause 248 extends the provisions with respect to staying or restraining proceedings against a company after the making of an application for winding up and before the making of a winding up order, to proceedings against a contributory of an unregistered company. |
| Clause 249 provides for the vesting of the outstanding property of a dissolved foreign company in such person as is entitled to such property according to the law of the place of incorporation. |
| Division 2 — Liquidation or dissolution of foreign companies |
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| Clause 250(1) provides that clause 250 applies to a foreign company which establishes a place of business or carries on business in Singapore, whether or not the foreign company is registered under Division 2 of Part XI of the Companies Act. Clause 250(1) clarifies the applicability of clause 250 to a foreign unregistered company in Singapore, which was an issue raised in the decision of the Court of Appeal in Beluga Chartering GmbH (in liquidation) and others v Beluga Projects (Singapore) Pte Ltd (in liquidation) and another [2014] 2 SLR 815. Clause 250(2) provides that the Court may appoint a liquidator of the foreign company for Singapore, on the application of the person who is the liquidator of the foreign company in its place of incorporation, or of the Official Receiver. Clause 250(5) requires the liquidator of a foreign company appointed for Singapore or a person exercising the powers and functions of such a liquidator to be satisfied that the interests of creditors in Singapore are adequately protected before paying any amount recovered or realised in Singapore to the liquidator of the foreign company for the place where it was formed or incorporated. |
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| PART 11CROSS-BORDER INSOLVENCY |
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| Clauses 251, 252 and 253 contain provisions to facilitate the resolution of cross‑border insolvency, in particular, giving effect to the UNCITRAL Model Law on Cross‑Border Insolvency (with certain modifications to adapt it for application in Singapore), as set out in the Third Schedule. |
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| PART 12GENERAL PROVISIONS APPLICABLE TO PARTS 4 TO 11 |
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| Clause 254 relates to the keeping of registers by the Registrar of Companies. |
| Clause 255 empowers the Registrar of Companies to require or permit any person to carry out any transaction or to issue any approval, certificate, notice, determination or other document pursuant or connected to such transaction using the electronic transaction system established under Part VIA of the Accounting and Corporate Regulatory Authority Act. |
| Clause 256 empowers the Court to rectify the register if it contains any erroneous or defective particulars. |
| Clause 257 sets out the circumstances in which a register may be rectified by the Registrar of Companies on a company’s application and the procedure for such rectification. |
| Clause 258 sets out the circumstances in which the Registrar of Companies may rectify or update a register on the Registrar of Companies’ own initiative, and the procedure to be followed, and the circumstances in which the Registrar of Companies may request a company or its officers to take steps to rectify particulars or documents in the register. |
| Clause 259 gives the Registrar of Companies and Official Receiver certain powers in relation to defective returns, and empowers the Court to make mandatory orders in relation to the lodging of returns, where there is failure to do so. |
| Clause 260 enables lost or destroyed documents to be replaced with leave of the Registrar of Companies. |
| Clause 261 enables the Minister to prescribe the size, durability and legibility of documents delivered to the Registrar of Companies. |
| Clause 262 makes it an offence for any person to lodge with the Registrar of Companies any document which the person knows is false or misleading in a material respect. |
| Clause 263 empowers the Court to grant relief in certain specified proceedings, if the person acted honestly and reasonably, and having regard to all the circumstances, the person ought fairly to be excused. |
| Clause 264 cures defects and irregularities and gives discretion to the Court to grant the types of relief mentioned in the clause. |
| Clause 265 relates to the translation of instruments, certificates, contracts or documents, etc., in foreign languages. |
| Clause 266 is a general penalty provision in respect of Parts 4 to 11. |
| Clause 267 relates to the default penalties in respect of offences under Parts 4 to 11. |
| Clause 268 confers certain powers of enforcement on the Official Receiver or any officer of the Official Receiver authorised by the Official Receiver. Clause 268 also empowers the Official Receiver to authorise the Registrar of Companies to exercise all or any of the enforcement powers under the clause. |
| Clause 269 relates to proceedings to be taken for an offence under Parts 4 to 12. |
| Clause 270 empowers the Court to grant an injunction to restrain a contravention of Parts 4 to 11. |
| Clause 271 empowers the Official Receiver to compound any offence under Parts 4 to 12 that is prescribed as a compoundable offence. Clause 271 also empowers the Official Receiver to authorise the Registrar of Companies to compound such offences. |
| Clause 272 gives any party aggrieved by an act or a decision of the Official Receiver or Registrar of Companies (as the case may be), a right to appeal to the Court against the act or decision. |
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| PART 13BANKRUPTCY — PRELIMINARY |
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| Clause 273 defines the terms used in Parts 13 to 21. |
| Clause 274 empowers the Court to issue a warrant for the arrest of a person against whom a bankruptcy application or bankruptcy order has been made, and for the seizure of the person’s property under certain circumstances. |
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| PART 14VOLUNTARY ARRANGEMENTS |
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| Division 1 — Moratorium for insolvent debtor |
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| Clause 275 specifies the debtors to whom Part 14 does not apply. |
| Clause 276 sets out the circumstances in which a debtor may apply to the Court for an interim order, and the effect and duration of such order. |
| Clause 277 requires a debtor proposing a voluntary arrangement to appoint in the debtor’s proposal a nominee to supervise the implementation of the voluntary arrangement, and requires that the nominee be a licensed insolvency practitioner. |
| Clause 278 empowers the Court to stay any action, execution or legal process against a debtor or the debtor’s property when an application for an interim order has been made by the debtor. |
| Clause 279 sets out the conditions for the making of an interim order. |
| Clause 280 provides that where an interim order has been made, the nominee must submit a report to the Court stating whether a meeting of the debtor’s creditors should be summoned to consider the debtor’s proposal. |
| Clause 281 provides that a nominee must summon a meeting of the debtor’s creditors for the purpose of considering the debtor’s proposal, if the nominee’s report under clause 280 stated that such a meeting should be summoned. |
| Division 2 — Consideration and implementation of debtor’s proposal |
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| Clause 282 regulates the conduct of a creditors’ meeting summoned under clause 281 and prescribes the extent to which such a meeting may modify the proposal of the debtor. |
| Clause 283 relates to the duties of the nominee after the conclusion of the creditors’ meeting, and empowers the Court to discharge the interim order if the meeting has declined to approve the debtor’s proposal. |
| Clause 284 sets out the effect of the approval of the debtor’s proposal by a meeting of the debtor’s creditors summoned under clause 281. |
| Clause 285 sets out when a debtor, nominee or person entitled to vote at a creditors’ meeting may apply to the Court for a review of a decision of the meeting, and the powers of the Court in respect of such an application. |
| Clause 286 relates to the duty of the nominee to supervise the implementation of a voluntary arrangement upon the approval of a debtor’s proposal by a meeting of the debtor’s creditors. |
| Clause 287 sets out the consequence of a debtor’s failure to comply with any of the debtor’s obligations under a voluntary arrangement. |
|
| PART 15DEBT REPAYMENT SCHEME |
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| Clause 288 defines the terms used in Part 15. |
| Division 2 — Proposal for debt repayment scheme |
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| Clause 289 requires the Official Assignee to review the suitability of a debtor (referred by the Court to the Official Assignee following the adjournment of a bankruptcy application against the debtor) for a debt repayment scheme, and sets out the factors determining a debtor’s suitability. |
| Clause 290 requires a debtor to submit a statement of the debtor’s affairs and a debt repayment plan to the Official Assignee, and also provides for the filing of proofs of debt by creditors of the debtor. |
| Clause 291 empowers the Official Assignee to approve the debt repayment plan of a debtor, with or without modification to the plans, after a meeting of the creditors has been convened to review the plan. |
Division 3 — Commencement and administration of
debt repayment scheme |
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|
| Clause 292 provides that a debt repayment scheme will commence in respect of a debtor on the date the debtor’s debt repayment plan comes into effect under clause 291. Clause 292 also empowers the Official Assignee to administer debt repayment schemes and to collect fees in relation to such administration. |
| Clause 293 provides for the operation of a moratorium on legal proceedings against a debtor until the cessation of the debt repayment scheme. |
| Clause 294 sets out the debts that are provable under a debt repayment scheme and provides for the manner of proving the debts. An appeal against the Official Assignee’s admission or rejection of a proof of debt lies to the Court but does not suspend the commencement, operation or effect of a debt repayment scheme. |
| Clause 295 provides for the modification of a debt repayment plan on or after the date that a debt repayment scheme commences. |
| Clause 296 provides for the payment of certain debts in priority to all other debts proved under a debt repayment scheme, and also for the payment of interest on debts. The clause differs from section 56I of the Bankruptcy Act in the following 2 ways: |
| (a) | premiums and other sums payable in respect of a debtor’s insurance cover under the MediShield Life Scheme are to be paid in priority; | | (b) | where the rate of interest on a debt was previously agreed or reserved, interest is to be calculated at that agreed or reserved rate, regardless of whether that agreed or reserved rate exceeds the prescribed rate of interest. |
| Clause 297 provides for the distribution of moneys collected by the Official Assignee under a debt repayment scheme to the creditors who have proved their debts under the scheme and whose debts are included in the debt repayment plan. |
| Division 4 — Cessation of debt repayment scheme |
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| Clause 298 specifies when a debt repayment scheme ceases, and provides that when a scheme ceases, the debt repayment plan under the scheme ceases to have effect. |
| Clause 299 requires the Official Assignee to issue a certificate of inapplicability of a debt repayment scheme if the debtor’s debts exceed the prescribed amount. |
| Clause 300 empowers the Official Assignee to issue a certificate of failure of a debt repayment scheme if any of the grounds specified in that clause exists. |
| Clause 301 requires the Official Assignee to issue a certificate of completion of a debt repayment scheme if the debtor repays the debtor’s debts in accordance with the debt repayment plan under the scheme. |
| Clause 302 empowers the Official Assignee to revoke the certificate of completion of a debt repayment scheme issued under clause 301 if the debtor had failed to disclose all the debtor’s property or the disposal of the debtor’s property or obtained the approval or modification of the debt repayment plan under the scheme by means of fraud, false representation or concealment of material facts. |
| Division 5 — Miscellaneous |
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| Clause 303 sets out the duties of a debtor under a debt repayment scheme. |
| Clause 304 establishes the Appeal Panel for the purpose of hearing appeals against the decisions of the Official Assignee under clauses 291 and 295, and also provides for the setting up of Appeal Panel Committees within the Appeal Panel to hear the appeals. |
| Clause 305 preserves the validity of acts carried out under a debt repayment scheme despite the cessation of the scheme or the revocation of the certificate of completion of the scheme. |
| Clause 306 provides for the offences under Part 15 and the applicable penalties. |
|
| PART 16PROCEEDINGS IN BANKRUPTCY |
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| Division 1 — Bankruptcy applications and bankruptcy orders |
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| Clause 307 sets out the persons who may make a creditor’s bankruptcy application, provides for the form of the application, and requires that the application be served. |
| Clause 308 sets out the persons who may make a debtor’s bankruptcy application and provides for the form of the application. |
| Clause 309 empowers the Court to make a bankruptcy order. |
| Clause 310 sets out the conditions that must be satisfied in relation to a debtor before a bankruptcy application against the debtor may be made. |
| Clause 311 sets out the grounds for the making of a bankruptcy application. |
| Clause 312 specifies the circumstances in which a debtor is presumed to be unable to pay the debtor’s debts. |
| Clause 313 requires an applicant for a bankruptcy order who is a secured creditor to give up the security for the benefit of the other creditors of the debtor, or to estimate the value of the security in the bankruptcy application. |
| Clause 314 provides for an expedited bankruptcy application. Where a creditor has served a statutory demand on a debtor, and there is a serious possibility that the debtor’s property or the value of all or any of the debtor’s property will be significantly diminished before 21 days have elapsed since the statutory demand was served, the creditor may make a bankruptcy application before the end of the period of 21 days. |
| Clause 315 provides that the Court may stay any proceedings on a bankruptcy application or dismiss a bankruptcy application. |
| Clause 316 provides for the circumstances when the Court may make a bankruptcy order on a creditor’s bankruptcy application, dismiss a creditor’s bankruptcy application, stay the proceedings on a creditor’s bankruptcy application, or refer the matter to the Official Assignee for the purpose of enabling the Official Assignee to determine the debtor’s suitability for a debt repayment scheme under Part 15. |
| Clause 317 provides when the Court may make a bankruptcy order on a bankruptcy application made by the nominee under, or any creditor bound by, a voluntary arrangement. |
| Clause 318 provides for the circumstances when the Court may make a bankruptcy order on a debtor’s bankruptcy application or refer the matter to the Official Assignee for the purpose of determining the debtor’s suitability for a debt repayment scheme under Part 15. |
| Clause 319 empowers the Court to consolidate separate bankruptcy proceedings against the same debtor. |
| Clause 320 empowers the Court, in a case where there are 2 or more respondents to a bankruptcy application, to dismiss a bankruptcy application against any or some of the respondents. |
| Clause 321 empowers the Court to substitute the applicant in bankruptcy proceedings where the applicant does not proceed with due diligence on the application. |
| Clause 322 allows the Court to order the service of a bankruptcy application on a deceased debtor’s personal representative or such other person as the Court thinks fit, or to dispense with such service. |
| Clause 323 relates to the withdrawal or deemed withdrawal of a bankruptcy application. |
| Division 2 — Protection of debtor’s property |
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| Clause 324 empowers the Court to appoint an interim receiver to protect a debtor’s property upon a bankruptcy application having been made against the debtor and sets out the effect of the appointment of an interim receiver. When an interim receivership is in force, no creditor of the debtor in respect of a debt provable in bankruptcy is able to commence or continue any action or other legal proceedings in respect of that provable debt against the debtor. |
| Clause 325 empowers the Court, after the making of a bankruptcy application against the debtor, to stay any action, execution or other legal process against a debtor or the debtor’s property. |
|
| PART 17ADMINISTRATION IN BANKRUPTCY |
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| Clause 326 relates to the commencement and duration of a bankruptcy. |
| Clause 327 sets out the effect of a bankruptcy order on the property of a bankrupt and a bankrupt’s debts. Clause 327(4) requires a secured creditor who intends to claim interest in respect of a debt to notify the Official Assignee of such intention within the specified time and to realise the secured creditor’s security within the specified time. |
| Clause 328 imposes certain restrictions on the disposition of property by a bankrupt between the time of the making of the bankruptcy application and the making of the bankruptcy order against the bankrupt. |
| Clause 329 specifies the property that forms part of the bankrupt’s estate and that is available for distribution amongst the bankrupt’s creditors. |
Division 2 — Inquiry into bankrupt’s affairs,
dealings and property |
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| Clause 330 empowers the Official Assignee to summon a meeting of a bankrupt’s creditors, and requires the Official Assignee to summon such a meeting in certain circumstances. |
| Clause 331 provides for the appointment of a creditors’ committee from amongst the creditors of a bankrupt to advise the Official Assignee on matters relating to the administration of the property of the bankrupt. |
| Clause 332 requires a bankrupt to submit a statement of the bankrupt’s affairs to the Official Assignee, sets out the particulars to be included in the statement, and empowers the Official Assignee to direct the bankrupt to submit supplementary information. Clause 332(9) requires a trustee in bankruptcy to notify the Official Assignee of the administration date for the bankruptcy and submit a copy of the statement of affairs and any supplementary information to the Official Assignee. |
| Clause 333 requires a bankrupt to give an account, when directed by the Official Assignee, of the moneys and property which have come into the bankrupt’s hands for the bankrupt’s own use during a specified period, and of such moneys and property which have been expended for the maintenance of the bankrupt and the bankrupt’s family during the same period. |
| Clause 334 provides for the Official Assignee’s power to examine persons listed in clause 334(2). The Official Assignee may summon any such person to appear before the Official Assignee and to be examined under oath in relation to the bankrupt’s affairs, dealings and property. The Official Assignee may also require the person to produce any book or document or any copy of such book or document, and may inspect, copy or take extracts from the book or document or copy of the book or document. |
| Clause 335 empowers the Official Assignee to apply to the Court for the Court to examine a bankrupt or former bankrupt and certain other persons related to the bankrupt or former bankrupt, and provides for the procedure for such examination. |
| Clause 336 specifies the power of the Court following the examination of the bankrupt and other persons under clause 335. |
| Clause 337 renders certain liens on the books and other records of a bankrupt unenforceable against the Official Assignee. |
| Clause 338 provides that the Official Assignee may (but is not required to) settle a list of debtors of the bankrupt’s estate after the making of a bankruptcy order. |
| Division 3 — Monthly contribution and target contribution |
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| Clause 339 requires the Official Assignee to determine, within 2 months after the administration date of the bankruptcy, the bankrupt’s monthly contribution and target contribution, by taking into account the factors listed in clause 339(2). Upon making the determination, the Official Assignee must serve a notice of the determination on the bankrupt and each creditor of the bankrupt. If the determination is made by a trustee in bankruptcy, the trustee in bankruptcy must serve the notice of the determination on the Official Assignee, together with an explanation of the basis for making the determination. |
| Clause 340 allows a bankrupt or any creditor of the bankrupt to apply to the Court for a review of the determination made under clause 339. A variation of the monthly contribution and target contribution by the Court does not affect any past payments of the monthly contribution or target contribution. A notice of any variation by the Court must be served on the bankrupt and each creditor of the bankrupt. |
| Clause 341 allows the Official Assignee, the bankrupt or a creditor of the bankrupt to apply to the Court for a variation of the bankrupt’s monthly contribution and target contribution when certain conditions listed in clause 341(2) are applicable. A variation of the monthly contribution and target contribution by the Court does not affect any past payments of the monthly contribution or target contribution. A notice of any variation by the Court must be served on the bankrupt and each creditor of the bankrupt. |
| Clause 342 allows the Official Assignee to issue a certificate reducing the bankrupt’s monthly contribution and target contribution upon the application of the bankrupt. The certificate may be issued only if the Official Assignee is satisfied that one or more of the conditions specified in clause 342(2) arose after the determination of the monthly contribution and target contribution. The conditions relate to non‑transient changes in the personal or family circumstances of the bankrupt that have affected either the income or the expenses of the bankrupt’s family. |
| Clause 343 allows a bankrupt or a creditor of the bankrupt to apply to the Court to review a decision of the Official Assignee under clause 342. Upon hearing such an application, the Court may confirm, vary or cancel the certificate issued under clause 342. A variation of the certificate under the clause does not affect any past payments of reduced monthly contribution made pursuant to the certificate. |
| Clause 344 establishes a mechanism for the Official Assignee to review a trustee in bankruptcy’s administration after either 5 or 7 years (whichever is applicable) have elapsed after the administration date for the bankruptcy. A trustee in bankruptcy must, not later than one month after each relevant anniversary of the administration date for the bankruptcy, submit to the Official Assignee a report of the administration containing particulars of the matters specified in clause 344(2). If the Official Assignee is of the opinion that the monthly contribution and the target contribution determined by the trustee in bankruptcy are excessive, the Official Assignee may issue a certificate reducing the monthly contribution and target contribution. |
| Division 4 — Proof of debts |
|
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| Clause 345 sets out the debts that are provable in bankruptcy. An appeal against the Official Assignee’s estimate of the value of any debt or liability lies to the Court. |
| Clause 346 provides that where there have been mutual dealings between a bankrupt and any creditor, the mutual debts and liabilities are to be set off, and only the balance is a debt provable in the bankruptcy. |
| Clause 347 requires the Official Assignee to, within 30 days after the administration date for the bankruptcy, give to every creditor notice of the bankruptcy order and the time within which creditors must file their proof of debt. A creditor who does not file a proof of debt within 4 months after the administration date cannot prove the debt in the bankruptcy, unless the Court or the Official Assignee extends the period for filing the proof of debt upon the application of the creditor. |
| Clause 348 provides that where a secured creditor omits to disclose the secured creditor’s security, the secured creditor must surrender the security or apply to the Court for relief on the ground that the omission was inadvertent or the result of an honest mistake. |
| Clause 349 requires a secured creditor who does not realise or surrender the secured creditor’s security to provide particulars of the security and the value the secured creditor assesses it at, and to only receive a dividend on the balance after deducting the assessed value of that security. |
| Clause 350 provides that where a secured creditor fails to comply with clause 348 or 349 or any regulation relating to proof of debts, the secured creditor is excluded from all share in any dividend. |
| Clause 351 requires observance of the prescribed regulations relating to proof of debts. |
| Clause 352 sets out the order of priority in which proved debts are to be paid in a bankruptcy. |
| Clause 353 relates to the payment of partnership debts. |
| Clause 354 restricts the right of a landlord, or other person to whom rent is payable by a bankrupt, to distrain upon the property of a bankrupt. |
| Clause 355 empowers the Court to discharge obligations under a contract between a bankrupt and another person on such terms as appears to the Court to be equitable. |
| Clause 356 relates to interest allowed on debts in a bankruptcy. |
| Division 5 — Composition or scheme of arrangement |
|
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| Clause 357 makes provision for the creditors to accept a proposal by the bankrupt for a composition in satisfaction of the debts due to them under the bankruptcy or for a scheme of arrangement of the bankrupt’s affairs, by way of special resolution. |
| Clause 358 empowers the Official Assignee to issue a certificate of discharge where a composition or scheme is accepted by special resolution, and a certificate of annulment where a composition or scheme is accepted by all creditors. |
| Clause 359 relates to the effect of a composition or a scheme of arrangement under clause 357 on a debt or liability. |
| Division 6 — Effect of bankruptcy on antecedent transactions |
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| Clause 360 makes provision for the application of the property of an undischarged bankrupt or deceased bankrupt where a second or subsequent bankruptcy order is made against the undischarged bankrupt or an order is made for the administration in bankruptcy of the estate of the deceased bankrupt. Any unsatisfied debts of a class specified in clause 352 in the preceding bankruptcy will rank equally with debts of the same class in the second or subsequent bankruptcy or the administration in bankruptcy. |
| Clauses 361 to 365 enable the Court, on the application of the Official Assignee, to make orders for restoring the position to what it would have been had the bankrupt not entered into a transaction at an undervalue or given an unfair preference to a creditor before the making of the bankruptcy application. |
| Clause 361 defines when an antecedent transaction at the relevant time between the bankrupt and another person will be considered a transaction at an undervalue. |
| Clause 362 defines when an antecedent transaction at the relevant time between the bankrupt and another person will be considered as the bankrupt giving an unfair preference to that person. |
| Clause 363 sets out the relevant time for the purposes of clauses 361 and 362. |
| Clause 364 defines an associate for the purposes of clauses 362, 363 and 365. |
| Clause 365 sets out the orders which the Court may make on the application of the Official Assignee under clause 361(2) or 362(2). |
| Clause 366 enables the Court, on the application of the Official Assignee, to vary or set aside any extortionate credit transaction between the bankrupt and a creditor. |
| Clause 367 deprives the creditor of the benefit of execution against property of a bankrupt, unless such execution was completed before the date of the bankruptcy order. |
| Clause 368 sets out the duties of the Sheriff in respect of property of a bankrupt taken in execution. |
Division 7 — Possession, control and
realisation of bankrupt’s property |
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| Clause 369 requires the Official Assignee to take possession of a bankrupt’s estate, papers and records and makes consequential provision relating to such taking of possession. |
| Clause 370 deals with the taking of inventory and seizure of property comprised in the bankrupt’s estate, papers and records, including documents which would be ordinarily privileged from disclosure in proceedings. |
| Clause 371 requires an undischarged bankrupt to pay to the Official Assignee, on a monthly basis, an amount not less than the bankrupt’s monthly contribution towards the bankrupt’s target contribution. Any other person may pay any sum towards the bankrupt’s target contribution. |
| Clause 372 empowers the Official Assignee to apply to the Court for the appropriation of part of the salary of a bankrupt public servant for distribution amongst the creditors, subject to the specified limit. |
| Clauses 373 to 376 provide that the Official Assignee may disclaim onerous property comprised in the bankrupt’s estate, and empower the Court to make certain orders where the Official Assignee has disclaimed property. |
| Clauses 377, 378 and 379 specify the general powers of the Official Assignee in the administration of a bankrupt’s estate, including the power to deal with property comprised in the estate and to appoint special managers. |
| Clause 380 empowers the Official Assignee to allow a bankrupt to manage the bankrupt’s property or to carry on the bankrupt’s trade for the benefit of the bankrupt’s creditors. |
| Clause 381 empowers the Official Assignee to order the re-direction of the bankrupt’s letters. |
| Clause 382 empowers the Official Assignee to direct the Controller of Immigration to prevent a bankrupt from leaving Singapore, and to detain the passport, certificate of identity or travel document of a bankrupt. |
| Clause 383 provides that the Official Assignee is not liable to incur any expense in relation to the realisation and distribution of a bankrupt’s property unless there is sufficient available property in the bankrupt’s estate. |
| Clause 384 provides that the Official Assignee is not liable to incur any expense in relation to the realisation and distribution of a bankrupt’s property, other than expenses in relation to payments made towards the target contribution, if a majority in value of the total debts that have been proved (and are not withdrawn) are owed to institutional creditors (or their subsidiaries), and the Official Assignee has given the requisite notice to all the creditors after the expiry of the time limited for the filing of proofs of debt. |
| Division 8 — Distribution of property |
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| Clause 385 provides for the manner of distribution of dividends among creditors. |
| Clause 386 provides for claims by a creditor who failed to prove the creditor’s debt before the declaration of a dividend, and for the payment of the dividend that the creditor had failed to receive, out of money available for payment of any further dividend. |
| Clause 387 provides the process for the distribution of a final dividend when the administration of a bankrupt’s estate is complete. |
| Clause 388 provides for the manner of distribution of the estate of a bankrupt partner. |
| Clause 389 precludes action against the Official Assignee for any refusal to pay a dividend. |
| Clause 390 provides for the payment, out of any surplus, of interest exceeding the amount of interest allowed under clause 356. The interest specified in clause 390(2) must be paid before a bankrupt is entitled under clause 391 to any of the surplus. |
| Clause 391 deals with the right of the bankrupt to the surplus of the bankrupt’s estate. |
|
| PART 18ANNULMENT AND DISCHARGE |
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| Clause 392 describes the circumstances in which the Court may annul a bankruptcy order, and the effect of such annulment on the acts of the Official Assignee prior to it. |
| Clause 393 empowers the Official Assignee to issue a certificate to annul a bankruptcy order where a bankrupt has paid the bankrupt’s debts in full. Clause 393 differs from section 123A of the Bankruptcy Act in that the Official Assignee need not publish the notice of a certificate of annulment in a local newspaper but may publish the notice in such other manner as the Official Assignee thinks fit. |
| Clause 394 specifies the circumstances under and the manner in which an order for discharge from bankruptcy by the Court may be made. |
| Clause 395 empowers the Official Assignee to issue a certificate for the discharge of a bankrupt after a prescribed minimum period has elapsed after the administration date of the bankruptcy. |
| Clause 396 allows any creditor of a bankrupt to object to the bankrupt being discharged under clause 395, and sets out the procedure for so doing. |
| Clause 397 sets out the effect of a discharge from bankruptcy. |
| Clause 398 imposes on a discharged bankrupt a duty to cooperate with the Official Assignee in the realisation and distribution of the discharged bankrupt’s property vested in the Official Assignee. |
|
PART 19DUTIES, DISQUALIFICATION AND
DISABILITIES OF BANKRUPT |
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| Clause 399 sets out the duties of a bankrupt in relation to — |
| (a) | the discovery and realisation of the bankrupt’s property by the Official Assignee; | | (b) | the examination of correctness of proofs of claims filed; | | (c) | the disclosure to the Official Assignee of any matter in respect of which the bankrupt is or may become a respondent in legal proceedings; and | | (d) | the updating of the Official Assignee of the bankrupt’s contact details. |
| Clause 400 disqualifies a bankrupt from being appointed or acting as a trustee or personal representative. |
| Clause 401 imposes disabilities on a bankrupt in respect of the commencement, continuation or defence of any action (except an action for damages in respect of injury to the bankrupt’s person or a matrimonial proceeding). |
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| PART 20BANKRUPTCY OFFENCES |
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| Clause 402 defines the terms used in Part 20. |
| Clause 403 provides for the Official Assignee’s power to investigate any offence under Parts 3 and 13 to 21. A person who, without reasonable excuse, fails to attend before the Official Assignee as required by a notice issued by the Official Assignee, to answer any question posed to the person when examined by the Official Assignee, or to furnish any information or document in the person’s possession when required by the Official Assignee, commits an offence. |
| Clause 404 provides a defence to certain offences under Part 20. Clause 404(1) provides a defence to certain offences under Part 20, which is available if, at the time of the conduct, the person had no intent to defraud or to conceal the state of the person’s affairs. Clause 404(2) provides a defence to certain offences under Part 20 which is available if, at the time of the conduct constituting the offence, the individual did not know or have any reason to believe that the individual had been made a bankrupt. |
| Clause 405 provides for an offence in the event of the failure by a bankrupt to disclose to the Official Assignee all the property comprised in the bankrupt’s estate or the disposal of property which but for the disposal would have formed a part of the bankrupt’s estate. |
| Clause 406 provides for offences relating to the concealment of property by a bankrupt. |
| Clause 407 provides for offences involving the concealment, falsification or disposal of documents by a bankrupt. |
| Clause 408 provides for offences relating to false statements by a bankrupt. |
| Clause 409 provides for offences relating to the fraudulent disposal of property by a bankrupt. |
| Clause 410 provides for offences relating to a bankrupt absconding with the bankrupt’s property. |
| Clause 411 provides for offences relating to fraudulent dealings with property obtained on credit by a bankrupt. |
| Clause 412 provides for offences relating to a bankrupt obtaining credit, engaging in business or providing a guarantee, indemnity or security, without informing the other person of the bankrupt’s status as an undischarged bankrupt. |
| Clause 413 provides for an offence for the failure of a bankrupt to keep proper accounts of the bankrupt’s business in the period of 2 years before the making of the bankruptcy application. |
| Clause 414 provides for an offence of gambling or rash or hazardous speculations by a bankrupt which contributed to the bankrupt’s insolvency. |
| Clause 415 provides for an offence by a bankrupt if he or she incurred debts without reasonable ground of expectation of being able to pay them. |
| Clause 416 provides for an offence for false claims made by creditors. |
| Clause 417 specifies the penalties for offences under Part 20. |
| Clause 418 sets out supplementary provisions relating to the exclusion of the defence of commission of an offence overseas, the contents of a charge for a bankruptcy‑related offence, and the effect of a discharge or an annulment of a bankruptcy order on the prosecution of the bankrupt for a bankruptcy‑related offence. |
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| PART 21BANKRUPTCY MISCELLANEOUS PROVISIONS |
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| Clause 419 provides for the administration of insolvent estates of deceased persons. |
| Clause 420 deals with the case where a bankrupt had become a party to a contract containing an arbitration agreement before the commencement of the bankruptcy. |
| Clause 421 relates to the payment of bills and charges of any solicitor, manager, accountant, auctioneer, broker or other persons by a trustee in bankruptcy or a special manager, and requires such bills to be taxed. |
| Clause 422 empowers the Court to authorise the Official Assignee to commence and prosecute any action or other legal proceeding in place of a partner in a firm who has been adjudged bankrupt. |
| Clauses 423 and 424 make special provision in relation to the bankruptcy courts of Malaysia and any designated country, and the reciprocal recognition of Official Assignees. |
| Clauses 425 and 426 permit a minute of proceedings at a meeting of creditors and documents used in bankruptcy proceedings to be admitted in evidence in all legal proceedings. |
| Clause 427 provides for the use of affidavits in Court. |
| Clause 428 relates to the admissibility of the evidence of a deceased witness in any proceedings under Parts 3 and 13 to 22. |
| Clause 429 relates to the service, including substituted service, of a summons, notice or document required or authorised to be served on any person under any provision of Parts 3 and 13 to 21. |
| Clause 430 validates the acts of a trustee of a bankrupt’s estate, a special manager and a creditors’ committee, despite any defect in their appointments. |
| Clause 431 deals with acts by a corporation, firm or a person lacking capacity for the purposes of Parts 3 and 13 to 22. |
| Clause 432 confers immunity on the Government and an employee for loss or damage suffered by users of a computerised information service provided by the Official Assignee by reason of any error or omission made in good faith and in the ordinary course of the discharge of the duties of the employee. |
| Clause 433 sets out the lists and records that the Official Assignee is required to maintain, and those lists or records maintained by the Official Assignee that any person may inspect or have access to upon the payment of the prescribed fee. |
| Clause 434 sets out how unclaimed or undistributed moneys in the Bankruptcy Estates Account and the Debt Repayment Schemes Account are to be dealt with. |
| Clause 435 relates to the establishment of a Debt Repayment Scheme Assistance Fund and empowers the Minister to prescribe in the regulations the use of the Debt Repayment Scheme Assistance Fund. |
| Clause 436 relates to the establishment of the Insolvency Assistance Fund. |
| Clause 437 provides for the composition by the Official Assignee of offences under Division 2 of Part 3 and Parts 13 to 21 that are prescribed as compoundable offences. |
|
| PART 22PROVISIONS AGAINST DEBT AVOIDANCE and limitation on certain contractual rights |
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| Clauses 438 and 439 concern transactions at an undervalue by a debtor (whether an individual, a company or otherwise) to defraud creditors, and empower the Court to make orders to restore the position to what it would have been prior to the transaction and to protect the interests of any victims of the transaction. These provisions replace section 73B of the Conveyancing and Law of Property Act which is repealed by clause 464. |
| Clause 440 is a new provision that limits the exercise of certain contractual rights by reason only that certain proceedings in respect of a company have commenced or that the company is insolvent. Clause 440 does not prevent those contractual rights from being exercised by reason of other grounds provided in the contract such as non-payment of money owed by the company. |
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| PART 23MISCELLANEOUS AND GENERAL PROVISIONS |
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| Clause 441 provides that clauses 442, 443 and 444 are not applicable to the filing or submission of certain documents, or the service of certain documents, as specified in clause 441(1), and defines certain terms used in clauses 442 to 446. |
| Clause 442 relates to the electronic delivery of a notice or other document in proceedings under the Bill. The clause also sets out the circumstances under which a notice or other document may be sent to a person by electronic means. |
| Clause 443 requires the relevant officeholder to provide a hard copy of a notice or document sent by electronic means under clause 442, if requested to do so by the recipient. |
| Clause 444 relates to the use of an Internet website by a relevant officeholder for the purposes of making available a document to an intended recipient, instead of sending such document to the intended recipient. The intended recipient must be notified of the availability of the document for download. |
| Clause 445 provides that certain meetings may be attended by persons who are not present together at the same place, so long as those persons are able to exercise any right to speak and to vote at the meeting. |
| Clause 446 allows the passing of a resolution by creditors or contributories by correspondence, without holding a meeting. |
| Clause 447 empowers the Minister to add to, vary or amend the Second or Third Schedule to the Bill. |
| Clause 448 empowers the Rules Committee appointed under section 80(3) of the Supreme Court of Judicature Act to make Rules of Court for the purposes of the Bill. Amongst other things, the Rules of Court may be made to — |
| (a) | regulate and prescribe proceedings and the practice and procedure of the Court under the Bill, and the Court of Appeal on an appeal from the Court; and | | (b) | provide for matters generally with respect to corporate insolvency proceedings or bankruptcy proceedings under the Bill. |
| Clause 449 empowers the Minister to make regulations for the purposes of carrying into effect the objects of the Bill. |
| Clause 450 relates to the repeal of the Bankruptcy Act, and empowers the Minister to repeal such provisions of the Bankruptcy Act as may be specified by the Minister by notification in the Gazette, on such date or dates as the Minister may appoint by that notification. |
|
PART 24CONSEQUENTIAL AND RELATED AMENDMENTS
TO OTHER ACTS |
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| Division 1 — Companies Act |
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| Clause 451 contains consequential and related amendments to the Companies Act. |
| Clauses 452 to 524 contain consequential and related amendments to certain other Acts. |
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| PART 25SAVING AND TRANSITIONAL PROVISIONS |
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| Clause 525 contains saving and transitional provisions relating to the repeal of the Bankruptcy Act. |
| Clause 526 contains saving and transitional provisions relating to the amendments to the Companies Act. |
| Clause 527 contains other saving and transitional provisions. |
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