Bankruptcy Amendment (Service of Documents) Regulations 2022

Administered by Attorney-General's Department

Legislation au F2022L00528 Regulations Not in force Legislative Instrument

Legislation content

bankruptcy amendment (service of documents) RegulationS 2022

 

 

EXPLANATORY STATEMENT
 

 

 

Issued by authority of the Assistant Minister to the Attorney-General

under the Bankruptcy Act 1966

Purpose and operation of the Instrument

The Bankruptcy Act 1966 (the Act) and associated legislation regulates Australia's personal insolvency system and provides a framework to allow people in severe financial stress to discharge unmanageable debts while providing for the realisation of a debtor's available assets for distribution to affected creditors.

 

Section 315 of the Act provides that the Governor‑General may make regulations prescribing matters required or permitted by the Act to be prescribed, or necessary or convenient to be prescribed, for carrying out or giving effect to the Act. Paragraph 315(2)(g) prescribes that the regulations may provide for the means of service of documents.

 

On 1 April 2021, the Bankruptcy Regulations 2021 (the Bankruptcy Regulations) commenced to address the sunsetting of the Bankruptcy Regulations 1996 (the 1996 Regulations). The Bankruptcy Regulations 2021 remade the 1996 Regulations in substantially the same form with minor and technical amendments aimed at modernising references and ensuring alignment with the Act. Section 102 replaced regulation 16.01 in the 1996 Regulations regarding the service of documents, which did not contain a requirement to seek consent before serving documents electronically.

 

Section 102 of the Regulations refers to section 28A of the Acts Interpretation Act 1901 (AIA) to specify additional methods of service. Section 28A of the AIA refers to the Electronic Transactions Act 1999 (ETA) in relation to service by electronic communication. Under paragraphs 9(1)(d) and (2)(d) of the ETA, a party is required to seek the consent of the recipient to provide written information in an electronic form.

 

A number of stakeholders including insolvency practitioners, creditors, and the Australian Financial and Security Authority (AFSA) have raised concerns that the requirement to seek consent before documents can be served electronically could be used to frustrate the administration and operation of the Bankruptcy Act, particularly if a person refuses to consent to receive documents electronically.

 

The Regulations amend section 102 of the Bankruptcy Regulations so that paragraphs 9(1)(d) and 9(2)(d) of the ETA do not apply to the electronic service of documents required or permitted by the Act or the Regulations. This will ensure that valid service of documents in electronic form can occur without the need for a party to seek consent from the recipient.

 

The Regulations establish the methods for service of documents under the Act or the Regulations and in particular specify that:

  • the ETA deals with giving information in writing by electronic communication; and
  • paragraphs 9(1)(d) and (2)(d) of the ETA will not apply to documents that are required or permitted by the Act or the Bankruptcy Regulations to be given or sent to, or served on, a person.

 

The Regulations will commence the day after registration on the Federal Register of Legislation.

 

Details of the Regulations are set out in Attachment A.

 

The Regulations are a legislative instrument for the purposes of the Legislation Act 2003.

 

Consultation

Consistent with the requirements of the Legislation Act 2003, the Regulations have been informed by close collaboration with AFSA, and a consultation process.

 

In November 2021, the Attorney-General’s Department advised a targeted group of stakeholders that it would examine how section 102 of the Regulations could be amended to reflect the original policy setting of former regulations 16.01 of the 1996 Regulations. Stakeholders included insolvency practitioner industry and member associations, consumer advocates and relevant Australian Government agencies such as AFSA and Treasury.

 

Regulation Impact Statement

The Office of Best Practice Regulation was consulted on the measures. It advised that the measures were unlikely to have a more than minor regulatory impact and, therefore, a Regulatory Impact Statement was not required (OBPR reference number 02013).

 

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview of the Legislative Instrument

The Bankruptcy Amendment (Service of Documents) Regulations 2022 (the Regulations) relates to paragraph 315(2)(g) of the Bankruptcy Act 1966 (the Act) which prescribes that the regulations may provide for the means of service and section 102 of the Bankruptcy Regulations which establishes the methods of service.

 

The Regulations amend the Bankruptcy Regulations 2021 to ensure that electronic service of bankruptcy documents can occur without the need for a party to seek consent from the recipient. It will address concerns that the requirement to seek consent in accordance with section 9 of the Electronic Transactions Act 1999 before documents can be served electronically could be used to frustrate the administration and operation of the Act.

Human rights implications

This Legislative Instrument does not engage any of the applicable rights or freedoms.

Conclusion

This Legislative Instrument is compatible with human rights as it does not raise any human rights issues.


ATTACHMENT A

NOTES ON SECTIONS

PART 1 – Preliminary

Section 1 – Name

 

This section provides that the name of the proposed Regulations is the Bankruptcy Amendment (Service of Documents) Regulations 2022.

 

Section 2 - Commencement

 

This section provides that the Regulations commence on the day after registration.

 

Section 3 - Authority

 

This section provides that the Regulations are made under the Bankruptcy Act 1966.

 

Section 4 - Schedule(s)

 

This section provides that each instrument that is specified in a Schedule to this instrument is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this instrument has effect according to its terms.

 

Schedule 1 - Amendments

 

Items [1] and [2] – subsection 102(1)

 

These items amend subsection 102(1) to include an additional Note that the Electronic Transactions Act 1999 deals with giving information in writing by means of an electronic communication, which mirrors the Note provided at subsection 28A(1) of the Acts Interpretation Act 1901. This item provides greater clarity that service by electronic communication is a valid method of service under the Act and Regulations.

 

Item [3] – section 102

 

This item amends section 102 to specify that paragraphs 9(1)(d) and (2)(d) of the Electronic Transactions Act 1999 do not apply to documents that are required or permitted by the Act or this instrument to be given or sent to, or served on, a person.

 

The Note clarifies that those paragraphs of the Electronic Transactions Act 1999 deal with the consent of the recipient of information or documents to the information being given by way of electronic communication.

 

This item ensures that parties do not need to seek this consent if a document is required or permitted by the Act or Regulations to be given to, sent to or served on a person by electronic communication.

Overview

The Bankruptcy Amendment (Service of Documents) Regulations 2022 (the Regulations) were enacted under the authority of the Assistant Minister to the Attorney-General in accordance with the Bankruptcy Act 1966. These Regulations aim to address concerns regarding the administration and operation of the Bankruptcy Act, specifically by modifying the requirements for serving documents electronically. Section 315(2)(g) of the Act empowers the Governor-General to make regulations necessary for carrying out or giving effect to the Act, including those that prescribe the means of service of documents. This legislative instrument responds to concerns raised by various stakeholders, including insolvency practitioners, creditors, and the Australian Financial Security Authority, who had identified potential issues with the existing requirement to seek consent before serving documents electronically, as stipulated under the Electronic Transactions Act 1999. The primary objective of these Regulations is to ensure that the electronic service of bankruptcy documents can proceed without needing consent from the recipient. By amending section 102 of the Bankruptcy Regulations 2021, the Regulations clarify that paragraphs 9(1)(d) and (2)(d) of the Electronic Transactions Act 1999 do not apply to documents required or permitted by the Act or the Regulations to be served electronically. This change aims to streamline the administration of the Bankruptcy Act and prevent any potential misuse of the consent requirement to obstruct legal processes. The Regulations will commence the day after their registration on the Federal Register of Legislation.

Scope and Application

The Bankruptcy Amendment (Service of Documents) Regulations 2022 amends the Bankruptcy Regulations 2021 to streamline the service of documents within Australia's personal insolvency system. These regulations apply to all parties involved in bankruptcy proceedings, including debtors, creditors, insolvency practitioners, and the Australian Financial Security Authority (AFSA), by addressing the method of service, particularly electronic service. The Regulations ensure that documents can be served electronically without needing the recipient's consent, a requirement previously stipulated under the Electronic Transactions Act 1999, which was seen as potentially hindering the efficiency of the bankruptcy process. This amendment is designed to uphold the integrity and timely administration of the Bankruptcy Act 1966 across Australia, ensuring that the service of documents is conducted in a manner that is both practical and in line with legislative intent. The Regulations commence the day after their registration on the Federal Register of Legislation, and they reflect a broader effort to modernise and streamline insolvency procedures in response to stakeholder feedback.

Key Provisions

The Bankruptcy Amendment (Service of Documents) Regulations 2022 (the Regulations) addresses section 102 of the Bankruptcy Regulations 2021 (section 102), which pertains to the methods of service of documents under the Bankruptcy Act 1966 (the Act). This amendment was necessitated by concerns raised by various stakeholders, including insolvency practitioners, creditors, and the Australian Financial Security Authority (AFSA), that the requirement to seek consent before serving documents electronically could hinder the effective administration of the Act. The Regulations specifically aim to ensure that electronic service of documents can proceed without the necessity of obtaining the recipient’s consent. The Regulations impose a clear obligation on parties involved in the administration of bankruptcy proceedings to use electronic communication as a valid method for serving documents, as stipulated in section 102. This amendment exempts such documents from the requirement to seek consent under the Electronic Transactions Act 1999 (ETA), specifically paragraphs 9(1)(d) and (2)(d) of the ETA. By doing so, the Regulations facilitate a smoother and more efficient process for the service of documents required or permitted by the Act or the Regulations, thereby streamlining the operation of the personal insolvency system. In terms of potential breaches and penalties, the Regulations themselves do not explicitly outline specific offences, penalties, or consequences for non-compliance. However, any failure to adhere to the requirements of the Act or the Regulations in serving documents could potentially lead to legal challenges or disputes, which might be addressed under the broader provisions of the Bankruptcy Act 1966. The Act includes various sections that outline the consequences of non-compliance, such as fines or imprisonment, depending on the nature and severity of the breach. Additionally, any actions taken in bad faith or with the intent to frustrate the administration of the Act could attract further legal scrutiny and penalties under general legal principles. The Regulations, by ensuring the clarity and efficiency of document service methods, aim to uphold the integrity and effectiveness of the personal insolvency system in Australia. This amendment, by removing the consent requirement for electronic service, ensures that the processes are not unduly hindered, thus supporting the timely and efficient resolution of bankruptcy cases.

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.