Personal Insolvency (Amendment) Bill 2014: Report and Final Stages

Recommittal is necessary in respect of amendments No. 1 and the other related amendments, as they relate to the instruction to committee motion.

Amendments Nos. 1 and 3 are related and will be discussed together.

Bill recommitted in respect of amendment No. 1.

I move amendment No. 1:

In page 3, line 7, to delete “Act,” and substitute the following:

“Act; to provide for court review of proposed Personal Insolvency Arrangements in certain circumstances; to amend the eligibility criteria for Debt Relief Notices; to further provide for the regulation and supervision of personal insolvency practitioners;”.

Amendment No. 1 is to amend the Long Title of the Bill. It takes account of the further amendments that I will be tabling to provide for a court review of proposed personal insolvency arrangements to increase eligibility threshold for debt relief notices and to improve regulatory and supervisory functions of the Insolvency Service of Ireland regarding personal insolvency practitioners. Amendment No. 3 provides for the change to DRN thresholds.

Deputies will recall that the Government announced a new strategy for tackling the mortgage arrears situation in May this year, in particular for dealing with those who are in chronic long-term mortgage arrears. A flagship element of this strategy is to introduce a new facility whereby a personal insolvency arrangement, which has been rejected by creditors under the arrangements in place at present, can be brought in certain circumstances to the Circuit Court for review and, subject to the tests set out, the court may decide to impose the rejected arrangement on the parties. This will present new options and hope to those borrowers who have under present arrangements run out of road. We will discuss this further in due course when the amendments to introduce this are moved.

The second major element of what is being proposed is to strengthen the regulatory powers of the Insolvency Service of Ireland vis-à-vis the personal insolvency practitioners, PIPs. This will increase confidence among debtors, creditors and other stakeholders that the Insolvency Service of Ireland has the full suite of regulatory powers necessary to oversee PIPs who, as we know, play a key role in the insolvency resolution processes.

I will come shortly to the third element which is, as proposed under amendment No. 3, to increase the threshold for eligibility for a debt relief notice from the current limit of €20,000 to €35,000. This has been requested in a number of quarters and will again bring a number of people, who would not qualify under current limits, to the possibility of a DRN which applies to those who have little or no income or assets but have accumulated amounts of debt which they have little or no hope of being able to pay in full.

In tandem with these new measures, the Government is working intensively, in a way which is co-ordinated across all relevant Departments and agencies, in delivering on the wider elements of the mortgage arrears initiative including arrangements to deliver assistance and advice through MABS and ISI in the courts when repossession actions are taking place; enhanced and expanded arrangements for mortgage to rent; and a nationwide information and publicity campaign aimed at getting those in serious mortgage arrears to engage with their lenders and with the courts where repossession proceedings have been initiated, coupled with an undertaking that, when they engage, co-ordinated services will be there to assist them.

These measures are being implemented across the system currently and everything will be in place and operational by September. Obviously, if the House approves the amendments I am tabling, including the measure for a court review of personal insolvency arrangements rejected by the banks, they also will be up and running in the next period.

Amendment No. 3 is to increase the upper limit of qualifying debts for debt relief notices under the Personal Insolvency Act. A debt relief notice, DRN, is a different debt settlement measure from a personal insolvency arrangement, which is the main focus of these amendments, but is also provided under the Personal Insolvency Act 2012.

It is aimed at people with very limited means, being limited to an insolvent person whose net disposable income after reasonable living expenses, which are defined, is less than €60 per month and who has assets of €400 or less, excluding basic household goods or tools, and a motor vehicle worth €2,000 or less.

Currently, the person’s debts may not exceed €20,000.

I am glad to say this amendment will widen the scope of debt relief notices, DRNs, under the Personal Insolvency Act by increasing the limit of the debt that may be subject to a DRN, from €20,000 to €35,000 per person. During the Department's review of the insolvency legislation the Money Advice and Budgeting Service, MABS, and other organisations working with people in debt pointed out that the €20,000 limit included in the Act was overly stringent and excluded many indebted persons from returning to solvency. The amount of debt held by insolvent persons approaching the MABS to seek a DRN is commonly up to €35,000, which is the reason for selecting this figure which more accurately responds to real needs. The issue was also raised by Deputy Pádraig Mac Lochlainn on Committee Stage who proposed an increase in the threshold to €30,000. The amendment will, I believe, open up the DRN solution to those who are not able to benefit from the other arrangements under the legislation. It will help people on very low incomes who do not own a property or significant assets and are weighed down by debts they cannot pay.

I welcome amendment No. 3.

Will the Minister expand on the wording in amendment No. 1 which reads to "provide for court review ... in certain circumstances". Will the certain circumstances be detailed in the legislation?

I will outline the detail included in the particular amendment when I come to it.

Amendment agreed to.
Bill reported with amendment.

Recommital is necessary in respect of amendments Nos. 2 and 22 to 25, inclusive, as they relate to the instruction to committee motion and also require recommittal under Standing Order 136.

Bill recommitted in respect of amendments Nos. 2 and 3.

I move amendment No. 2:

In page 3, between lines 10 and 11, to insert the following:

“Amendment of section 9 of Principal Act

2. Section 9(1) of the Principal Act is amended by—

(a) the substitution of the following for paragraph (e):

“(e) promote public awareness and understanding of matters relating to personal insolvency, and provide information on the working of this Act and of the Bankruptcy Act 1988, and on related matters including those specified in paragraphs (jb), (jc) and (jd);”,

and

(b) the insertion of the following after paragraph (ja) (inserted by section 38 of the Courts and Civil Law (Miscellaneous Provisions) Act 2013):

“(jb) compile, collect, analyse and disseminate information and statistics on the operation of this Act and of the Bankruptcy Act 1988;

(jc) monitor and analyse developments, as respects, the situation of insolvent debtors, and trends in, and patterns of, debtor and creditor behaviour;

(jd) develop strategies for communicating with the public aimed at promoting the use of insolvency arrangements and enhancing their effective application;”.”.

Amendment No. 2 is to section 9 of the Personal Insolvency Act 2012 which sets out the functions of the Insolvency Service of Ireland. It expands on the important functions of the service regarding information, awareness-raising and communication in personal insolvency and bankruptcy matters.

Paragraph (a) gives the Insolvency Service of Ireland explicit powers to promote awareness and understanding of insolvency and bankruptcy legislation. In that regard, I should acknowledge the proactive approach to public information the service has been taking nationwide. Research undertaken by it last year showed that many people in serious debt were not aware of the services available to them through it. The amendment underlines the importance of public awareness as a crucial step in responding effectively to problem debt.

Paragraph (b) further strengthens the role of the Insolvency Service of Ireland in developing and maintaining expertise in relation to the operation of the Personal Insolvency and Bankruptcy Acts and monitoring and analysing developments in debtor and creditor behaviour. These functions will ensure the existence of a national expert authority on insolvency and bankruptcy and its availability, where required, in policy development and decision-making. Paragraph (b) focuses on development by the ISI of communication strategies to promote the use of insolvency arrangements and enhance their effectiveness. This function lies at the heart of my amendments to the Bill.

Amendments Nos. 22 to 25, inclusive, provide for a more detailed and effective power for the Insolvency Service of Ireland to exercise a proactive supervision over personal insolvency practitioners, PIPs. The Act already provides extensive powers for the ISI to intervene where there is a complaint, or where there is some reason to suspect that a PIP has not correctly fulfilled his or her duties under the Act. It is a reactive power, carried out by inspectors whose functions and powers are already provided in the Act. However, it does not provide for a proactive supervision power which would allow for routine inspection without need for a reasonable apprehension of misconduct. This sort of proactive supervision power reflects what is already the case for legal and accountancy professional bodies or debt advisors supervised by the Central Bank. It represents a "good practice" standard and the ISI has requested such an extension of its powers for that reason. It is very important, given the trust placed in PIPs to administer the funds of insolvent persons and fulfil statutory duties both to creditors and debtors, that they enjoy the fullest public confidence. I consider it appropriate that the ISI should have such a detailed power. The Act already provides a general supervisory power for the ISI in section 9 and amendments Nos. 22 to 25, inclusive, will now translate it into detailed application by providing for the appointment of authorised officers who will carry out the proactive supervision function and conferring on them the necessary powers.

Amendment No. 22 provides for a stronger definition of “improper conduct” in respect of authorised officers and extends ISI powers to supervise and investigate the conduct of PIPs in respect of a more comprehensive range of breaches of the Personal Insolvency Act.

Amendment No. 23 inserts sections 176A to 176D, inclusive, to the Act of 2012. Section 176A provides the ISI with a new supervisory function to ensure PIPs comply with their statutory obligations. This is an important provision. It is in line with current regulatory best practice and in the public interest. Currently, insolvency legislation only provides for investigations in response to complaints.

I want to ensure there is full public confidence in PIPs and the important services they deliver. For example, PIPs hold money for the person in an insolvency arrangement and pay out that money to creditors. A proactive supervisory function will also be a protection for PIPs. Section 176B deals with the appointment of authorised officers to carry out supervisory functions.

Section 176C addresses the powers of the authorised officer to pursue his or her responsibilities. The powers are standard and found elsewhere in the Statute Book and reflect the important nature of the functions of PIPs.

Section 176D requires an authorised officer, where improper conduct by a PIP is found to have occurred or is occurring, to notify the ISI of that conduct. Section 176D also requires the ISI after such notification to have an investigation carried out where there is sufficient reason to do so.

Amendment No. 24 amends section 181 of the Personal insolvency Act 2012 which deals with measures to assist an inspector in carrying out an investigation of a PIP. In general, the new authorised officer powers reflect those already available to inspectors under the Act. However, in a few cases a new power, reflecting current best practice standards for supervision, has been included for authorised officers. The amendment extends these extra powers also to inspectors as they are also relevant for their work.

Amendment No. 25 amends section 186 of the Act of 2012 which deals with restrictions in relation to the Data Protection Act 1988 and extends the same protection to authorised officers as already applies to inspectors under the Act.

Amendment agreed to.

I move amendment No. 3:

In page 3, between lines 10 and 11, to insert the following:

"Amendment of section 26 of Principal Act

3. Section 26 of the Principal Act is amended in subsection (2)(a) by the substitution of "€35,000" for "€20,000".".

Amendment agreed to.
Bill reported with amendments.

I move amendment No. 4:

In page 3, between lines 10 and 11, to insert the following:

Amendment of section 16 of Principal Act

2. Section 16 of the Principal Act is amended by the insertion of the following new subsection after subsection (2):

“(2A) Where a Debt Relief Notice, a Debt Settlement Arrangement or a Personal Insolvency Arrangement as outlined in the Principal Act is rejected by a majority of creditors, this information will be included in the Annual Report of the Insolvency Service of Ireland.”.”.

I have resubmitted this amendment which was tabled on Committee Stage. This is a new authority in respect of which there were many issues in the primary legislation. We are back today to work out the teething problems. One of the big lessons we have learned in listening to people in our clinics and reading the newspapers and I learned when I attended a sitting of the Circuit Court in Limerick on a home repossession day concerns the absence of public information on the workings of and the service provided by the Insolvency Service of Ireland.

Every opportunity should be taken to make information available to the public. First, there is a challenge to let the public, particularly those who are in financial distress, know the Insolvency Service of Ireland is available to help them. Second, for those who are aware of that, we need to let them know about its processes and how it works. The amendment states: "Where a Debt Relief Notice, a Debt Settlement Arrangement or a Personal Insolvency Arrangement as outlined in the Principal Act is rejected by a majority of creditors, this information will be included in the Annual Report". This would go a long way towards providing that information to the public and would help create debate, which would help promote public awareness of the service that is available.

I appreciate the intention of the amendment which seeks to ensure information about credit refusals is publicly available. However, given the recent changes, I do not believe the amendment is necessary or workable in its current form for the following reasons. As the Deputy is aware, since the first quarter of this year, the Insolvency Service of Ireland already publishes details, on a quarterly basis, of debt settlement arrangements and personal insolvency arrangements which have been voted down by creditors. While the Deputy was calling for that information to be made available on an annual basis, it is now available on a quarterly basis and I understand more information will be published tomorrow by the Insolvency Service of Ireland. As the Deputy knows, there is also the annual report, which goes into huge detail on the DRNs and PRAs, the amount of debt that is being dealt with by the ISI, the number of bankruptcies and so on. Very detailed information is now available.

Debt relief notices would not fall to be included in the proposed amendment, since the Personal Insolvency Act does not provide for a creditor vote for this type of arrangement. As I explained when I was increasing the thresholds, the DRN is a limited write-down of unsecured debt for persons with very little income or assets which is approved directly by the court. A creditor can object to the court but no creditor vote is required because of the very specific and limited nature of this debt solution.

Amendment, by leave, withdrawn.

Recommittal is necessary in respect of amendment No. 5 as it relates to the instruction to committee motion.

Bill recommitted in respect of amendment No. 5.

I move amendment No. 5:

In page 13, between lines 19 and 20, to insert the following:

“Amendment of section 91 of Principal Act

10. Section 91 of the Principal Act is amended—

(a) in subsection (1), by the substitution of the following for paragraph (g):

“(g) that the debtor has made a declaration in writing declaring that he or she has co-operated for a period of at least 6 months with his or her creditors who are secured creditors as respects the debtor’s principal private residence in accordance with any process relating to mortgage arrears operated by the secured creditors concerned which has been approved or required by the Central Bank of Ireland and which process relates to the secured debt concerned and that—

(i) notwithstanding such co-operation the debtor has not been able to agree an alternative repayment arrangement with the secured creditor concerned, or that the secured creditor has confirmed to the debtor in writing the unwillingness of that secured creditor to enter into an alternative repayment arrangement, or

(ii) the debtor—

(I) has entered into an alternative repayment arrangement and has, in good faith, endeavoured to comply with that arrangement, and

(II) the personal insolvency practitioner has provided the debtor with a confirmation under subsection (2A);”,

and

(b) by the insertion of the following after subsection (2):

"(2A) A confirmation under this subsection is a confirmation in writing by the personal insolvency practitioner that, having regard to the financial circumstances of the debtor as disclosed in the Prescribed Financial Statement completed by the debtor, and the terms of the alternative payment arrangement referred to in subsection (1)(g)(ii), it is the belief of that practitioner that the debtor, if he or she were not to enter into a Personal Insolvency Arrangement, would be unlikely to become solvent within the period of 5 years commencing on the date of the personal insolvency practitioner giving that confirmation.”.”.

The amendment is designed to remove a potential bar to some insolvent borrowers being able to make a proposal for a personal insolvency arrangement and, therefore, to access the new court review under the Bill. It relates to people who were in mortgage arrears on their own homes and who have entered into an agreement to restructure their mortgage.

Under section 91(1) of the Act, a borrower must first co-operate with the mortgage lender under the mortgage arrears resolution process approved by the Central Bank before he or she can make a proposal for a personal insolvency arrangement. If the borrower does so but is not able to agree a restructure with the mortgage lender, he or she is then eligible to propose a personal insolvency arrangement. The question has arisen, however, as to eligibility where a borrower has co-operated with MARP and has entered a restructure, whether MARP or non-MARP, but the restructure has failed or is unsustainable, and the borrower remains insolvent.

It is important that a borrower in this situation should be eligible to make a PIA proposal. This amendment clarifies that this is the case by explicitly adding that a borrower is eligible to propose a PIA if he or she has co-operated with MARP and has entered a MARP or non-MARP mortgage restructure, which he or she has tried in good faith to comply with but remains insolvent. Insolvency is confirmed simply by their personal insolvency practitioner confirming that the person remains insolvent and is unlikely to become solvent within five years without being able to avail of a PIA.

We have engaged with some of the stakeholders around the Minister's amendments. We are concerned that the new wording, taken in conjunction with the proposal in section 13, will mean that those in restructured arrangements may not be eligible for a court review. The purpose of the amendments seems at first glance only to strengthen the hand of the banks in putting up another obstacle for the debtor to surmount. The unamended section does not mention restructured debt. By explicitly mentioning it, I fear its purpose could be to exclude rather than include. Additionally, given what the Central Bank's review has shown up in terms of the scandalous failure of banks to implement the code of conduct on mortgage arrears, I wonder whether that particular obstacle for a debtor is inherently unfair. It is said that we have to play by the rules but we know the banks have not been playing by them. We will listen to the Minister's explanation and we will discuss with our Seanad colleagues whether we may seek to amend this Bill in the Seanad.

I want to deal with this point that they may not be eligible. In fact, that is a mistaken view as the Bill specifically protects people in mortgage restructures. It expressly provides a new section 115A(18)(b), inserted by amendment No. 13, whereby access to the new court review is available for a person who was in mortgage arrears on his or her home at any point before 1 January 2015 but has entered a mortgage restructure of those arrears. If the restructure has not restored the person to solvency, he or she can propose a PIA. Section 91 of the Act is also amended at amendment No. 5 to ensure there is no possible bar to this being done. If the PIA proposal is rejected by creditors, the person can apply for a court review of the rejection in accordance with the new section 115A of the Act. I hope that explains that issue.

Amendment agreed to.
Bill reported with amendment.

Recommittal is necessary in respect of amendment No. 6 and other related amendments as they relate to the instruction to committee motion. Amendments Nos. 6, 7 and 10 are consequential on amendment No. 13. Therefore, amendments Nos. 6, 7, 10 and 13 may be discussed together.

Bill recommitted in respect of amendments Nos. 6 and 7.

I move amendment No. 6:

In page 13, between lines 19 and 20, to insert the following:

“Amendment of section 95 of Principal Act

11. Section 95 of the Principal Act is amended in subsection (5) by the deletion of “section 113(2)” and the substitution of “sections 113(2) and 115A(5),”.”.

I am pleased to propose this group of amendments, which contains at amendment No. 13 the new provision for independent review by the courts where a proposal for a personal insolvency arrangement, including arrears on the borrower’s home mortgage, has been refused by creditors. This follows the Government’s decision on 13 May on increasing support for borrowers in mortgage arrears on their homes and especially for those at risk of repossession. This is a key reform, designed to ensure fair and sustainable debt deals are upheld for struggling borrowers who want to work their way out of debt with a view to keeping their homes. It will protect distressed mortgage holders and will provide a better balance between the interests of banks and of those facing unsustainable mortgages.

Amendment No. 13 contains the substantive provision for review, while amendments Nos. 6, 7 and 10 are consequential amendments. Amendments Nos. 6 and 7 ensure that where a borrower applies for the new court review, he or she will remain protected by the protective certificate - a court order preventing enforcement action or pressure by creditors - pending the determination of the review. Amendment No. 10 refers to the specific procedures for creditor approval that apply when there is only a sole creditor. In that case, no creditor meeting is required and section 10 ensures that where the sole creditor refuses the proposal, the borrower in that situation can also apply for the court review.

Amendment No. 13 sets out the provisions applicable to the review itself. Under the 2012 Act, a proposed personal insolvency arrangement is voted on by the creditors and must be approved by the necessary majorities of secured and unsecured creditors. If the creditors reject the proposal, however, there is no existing provision for a review or appeal. The new court review will change this situation. It will apply to proposed personal insolvency arrangements that have been vetoed by creditors where the debts include a mortgage on the debtor’s home which was in arrears on 1 January 2015.

The objective of the new review is to help people who are in serious mortgage arrears on their family homes, particularly those who are at risk of repossession. Therefore, the review is available to a borrower who was in mortgage arrears on their home on 1 January 2015. It is also available if the borrower was in such arrears before that date, which have been restructured under a MARP or non-MARP restructure, but nevertheless the borrower remains insolvent, which is the point raised by Deputy Mac Lochlainn.

The Government announced last May that its court review mechanism would be based on court examinership. The examinership concept is already tried and tested in the Irish courts and has been found to stand up constitutionally, which is a critical point.

In examinership, the examiner must show some element of creditor support. Equally with this new measure, some element of creditor support is needed. However, this is a much lower and more flexible requirement than the test which currently applies, and it should be feasible in the large majority of cases. Moreover, it is important to note that the Bill also provides for a significant exception to the creditor support requirement. In many cases involving a mortgage, the borrower has consolidated their debts with the bank which is also their mortgage lender. This is a very critical point in terms of who has access to the review. The Bill provides that in these so-called sole creditor cases, if the sole creditor refuses the personal insolvency arrangement, PIA, proposal, the debtor does not have to show any creditor support before seeking a court review. This effectively opens up the whole PIA process to a large number of cases where up to now, no PIA proposal has even been made as it was felt that the sole creditor would never agree to a deal offering statutory protection for the borrower.

Under the existing provisions of the Act, only three classes of creditor can be looked to regarding PIA approval – secured, unsecured and overall debt – and all three of those classes must approve it by majority. In the new court review, as in examinership, the test is different. The personal insolvency practitioner has to show that there is majority support of over 50% from just one class of creditor, not three, and, more important, there is far more flexibility about what constitutes a class. It may be just one creditor or more than one creditor with some commonality of interest among them. It is not limited to the classes of overall, secured or unsecured debt. This flexibility will support finding a solution which is fair and reasonable for all concerned, as it does in examinership, and the court will ensure this test is applied fairly.

I underline that a key advantage of using an examinership approach is that, following extensive deliberation and legal advice, the Government believes this Bill is constitutionally robust in the very difficult legal territory of potentially providing for imposed solutions which could to an extent impinge on the rights of secured lenders. That legal security is vitally important for borrowers in mortgage arrears. In summary, this new review is a major reform which represents a groundbreaking shift from the current position and will significantly re-balance the position of creditors and debtors to ensure fair and balanced outcomes. I commend the amendment to the House.

I thank the Minister. It is fair to say we are now addressing the big deficiency in the original Bill in terms of the whole issue of the bank veto. Could the Minister flesh the matter out a little more for us? The court will either accept or reject the proposal which the personal insolvency practitioner is bringing forward. That, I presume, will be one of those insolvency judges at Circuit Court level. Is that right?

If the court refuses the arrangement, will the personal insolvency practitioner, on behalf of the debtor, have the option to appeal up along the line to the High Court, Court of Appeal and ultimately the Supreme Court?

Amendment No. 13 is the most important aspect as it deals with the infamous bank veto. After the Opposition repeatedly raised its concerns, we finally got a promise that the banks' veto would be scrapped. Is the veto gone? In some cases, it is subject to the courts, while in other cases it is not clear at all, from our interpretation.

If someone falls into arrears after 2 January this year, the banks still have their veto. What is really being proposed is a temporary empowering of the courts in some circumstances to overrule a bank's veto if certain conditions are met. That is not what was promised as far as I am concerned. We believe the veto will remain in the majority of cases. We know how adept the banks are at getting their way. I have major doubts as to whether the solution will work for the vast majority of mortgage holders or others in debt.

The Government has taken quite a while to come to this Stage and we are concerned that only those eligible for a personal insolvency arrangement, and not just a debt settlement arrangement, have any chance of appealing. We would like to get the Minister's response to those concerns, and we reserve the right to propose amendments in the Seanad if we cannot get assurance in respect of our concerns.

This is the first time a judge of the Circuit Court may, in specific circumstances, impose on lenders an insolvency arrangement which they voted down. That is a very important point to note. We are providing for a situation in which a borrower has only one creditor. I emphasised this point when I was introducing the amendment. Many people would be in that situation, with the bank having consolidated the loans and holding the mortgage. They can get the court review even if the one creditor is opposed to a deal. That is a very wide group of people As I have already said, we are raising the debt relief notice, DRN, limit from €20,000 to €35,000.

When we announced the review in May, one of the key points I made - I have also made it this evening when introducing the amendment - is that it would be based on the court examinership model. If there is absolutely no creditor support in an examinership, it is not feasible. The examinership concept is tried and tested in the courts in terms of constitutionality, which is very important when we are talking about imposing a solution for creditors. With this new measure, if there is no vestige at all of creditor support, even potentially from one of the creditors, the procedure cannot be invoked. That is correct. It is the examinership model. As in examinership, the court may only impose the PIA arrangement in a new court review where there is some degree of support evident from at least 50% of one class of creditors. Under the existing provisions of the Act, only three classes of creditor can be looked to regarding the PIA, as I have said. I have gone into the detail of that. However, in examinership, not only is just one class required, there is far more flexibility about what constitutes a class.

The measures are aimed at assisting people in long-term arrears. They are part of the overall Government strategy. The date of 1 January is there, and it is not intended to impact on new mortgages that have been taken out since that date. It is about targeting those people. Let us remember that 85% of people are paying their mortgages. We are talking about a group of people who have long-term arrears and who have not been able to come to a solution. In some instances, they have not made contact with banks and the agreements have been vetoed at the creditors' meetings. It is to deal with this particular group, which is the reason for the date of 1 January.

Amendment agreed to.

I move amendment No. 7:

In page 14, line 10, after “approved,” to insert “subject to section 115A,”.

Amendment agreed to.
Bill reported with amendments.

Amendments Nos. 8 and 9 are related and may be discussed together.

I will withdraw amendment No. 8 given the Government's approach, as previously discussed.

Amendments Nos. 8 and 9 not moved.
Bill recommitted in respect of amendment No. 10.

I move amendment No. 10:

In page 15, line 41, after “proposal,” to insert “subject to section 115A,”.

Amendment agreed to.
Bill reported with amendment.

Recommital is necessary in respect of amendment No. 11 and the other related amendments as they do not arise out of Committee proceedings. Amendments Nos. 11, 12 and 15 are related drafting amendments and will be discussed together.

Bill recommitted in respect of amendments Nos. 11 to 13, inclusive.

I move amendment No. 11:

In page 16, lines 13 to 15, to delete all words from and including “Where” in line 13 down to and including line 15 and substitute the following:

“Where a Personal Insolvency Arrangement is approved at a creditors’ meeting in accordance with section 110 or, as the case may be, deemed under section 108 to have been approved, the personal insolvency practitioner shall”.

These are consequential amendments and technical corrections related to the original purpose of the Bill.

Amendment agreed to.

I move amendment No. 12:

In page 17, lines 2 and 3, to delete “section 111(7)” and substitute “section 111A(7)”.

Amendment agreed to.

I move amendment No. 13:

In page 18, between lines 36 and 37, to insert the following:

“Court review of proposed Personal Insolvency Arrangement

17. The Principal Act is amended by the insertion of the following after section 115:

“115A. (1) Where—

(a) a proposal for a Personal Insolvency Arrangement is not approved in accordance with this Chapter, and

(b) the debts that would be covered by the proposed Personal Insolvency Arrangement include a relevant debt, the personal insolvency practitioner may, where he or she considers that there are reasonable grounds for the making of such an application and if the debtor so instructs him or her in writing, make an application on behalf of the debtor to the appropriate court for an order under subsection (9).

(2) An application under this section shall be made not later than 14 days after the creditors’ meeting referred to in subsection (16)(a) or, as the case may be, receipt by the personal insolvency practitioner of the notice of the creditor concerned under section 111A(6) (inserted by section 13 of the Personal Insolvency (Amendment) Act 2015), shall be on notice to the Insolvency Service, each creditor concerned and the debtor, and shall be accompanied by—

(a) a statement of the grounds of the application, which shall include—

(i) a statement that the proposal for a Personal Insolvency Arrangement has not been approved in accordance with this Chapter,

(ii) other than where the proposed Personal Insolvency Arrangement is one to which section 111A applies, a statement identifying, by reference to the information referred to in paragraph (d)(i)(II) contained in the certificate furnished under paragraph (d), the creditor or creditors who, having voted in favour of the proposal, should, in the opinion of the personal insolvency for the purpose of this section, and giving the reasons for this opinion,

(b) a copy of the proposal for a Personal Insolvency Arrangement,

(c) a copy of the report of the personal insolvency practitioner referred to in section 107(1)(d),

(d) a certificate—

(i) with the result of the vote taken at the creditors’ meeting and identifying—

(I) the proportions of the respective categories of votes cast by those voting at the creditors’ meeting, and

(II) the creditors who voted in favour of and against the proposal, and the nature and value of the debt owed to each such creditor,

or

(ii) where applicable, stating that section 111A applies to the proposal and that the creditor concerned has notified the personal insolvency practitioner under section 111A(6) that the creditor does not approve of the proposal,

and

(e) a statement by the personal insolvency practitioner to the effect that he or she is of the opinion that—

(i) the debtor satisfies the eligibility criteria for the proposal of a Personal Insolvency Arrangement specified in section 91,

(ii) the proposed Personal Insolvency Arrangement complies with the mandatory requirements referred to in section 99(2), and

(iii) the proposed Personal Insolvency Arrangement does not contain any terms that would release the debtor from an excluded debt or an excludable debt (other than a permitted debt) or otherwise affect such a debt.

(3) A notice to a creditor under subsection (2) shall be accompanied by a notice indicating that he or she may, within 14 days of the date of the sending of the notice, lodge a notice with the appropriate court, setting out whether or not the creditor objects to the application, and the creditor’s reasons for this.

(4) A creditor who lodges a notice under subsection (3) shall at the same time send a copy of the notice to the Insolvency Service, the personal insolvency practitioner and each creditor concerned.

(5) Where an application is made under this section before the expiry of the period of the protective certificate, such protective certificate shall continue in force until—

(a) the Personal Insolvency Arrangement comes into effect under subsection (13), or

(b) one of the following occurs—

(i) the time for bringing an appeal against a refusal of the appropriate court to make an order under subsection (9) has expired without any such appeal having been brought,

(ii) such appeal has been withdrawn, or

(iii) the appeal has been determined.

(6) The appropriate court, for the purpose of an application under this section, shall hold a hearing, which hearing shall be on notice to the Insolvency Service, the personal insolvency practitioner and each creditor concerned.

(7) A hearing under this section shall be held with all due expedition.

(8) The court shall consider whether to make an order under subsection

(9) only where—

(a) it is satisfied that—

(i) the eligibility criteria specified in section 91 have been satisfied,

(ii) the mandatory requirements referred to in section 99 have been complied with, and

(iii) the proposed Arrangement does not contain any terms that would release the debtor from an excluded debt or an excludable debt (other than a permitted debt) or otherwise affect such a debt,

and

(b) it considers that, having regard to the information before it, including information contained in a notice under subsection (3), no ground specified in section 120 applies in relation to the debtor or the proposed Arrangement.

(9) The court, following a hearing under this section, may make an order confirming the coming into effect of the proposed Personal Insolvency Arrangement only where it is satisfied that—

(a) the terms of the proposed Arrangement have been formulated in compliance with section 104,

(b) having regard to all relevant matters, including the terms on which the proposed Arrangement is formulated, there is a reasonable prospect that confirmation of the proposed Arrangement will—

(i) enable the debtor to resolve his or her indebtedness without recourse to bankruptcy,

(ii) enable the creditors to recover the debts due to them to the extent that the means of the debtor reasonably permit, and

(iii) enable the debtor—

(I) not to dispose of an interest in, or

(II) not to cease to occupy,

all or a part of his or her principal private residence,

(c) having regard to all relevant matters, including the financial circumstances of the debtor and the matters referred to in subsection (10)(a), the debtor is reasonably likely to be able to comply with the terms of the proposed Arrangement,

(d) where applicable, having regard to the matters referred to in section 104(2), the costs of enabling the debtor to continue to reside in the debtor’s principal private residence are not disproportionately large,

(e) the proposed Arrangement is fair and equitable in relation to each class of creditors that has not approved the proposal and whose interests or claims would be impaired by its coming into effect,

(f) the proposed Arrangement is not unfairly prejudicial to the interests of any interested party, and

(g) other than where the proposal is one to which section 111A applies, at least one class of creditors has accepted the proposed Arrangement, by a majority of over 50 per cent of the value of the debts owed to the class.

(10) In considering whether to make an order under subsection (9), the court shall have regard to:

(a) the conduct, within the 2 years prior to the issue of the protective certificate under section 95, of—

(i) the debtor in seeking to pay the debts concerned, and

(ii) a creditor in seeking to recover the debts due to the creditor;

(b) the following, where details of them are contained in a notice lodged under subsection (3) by a creditor—

(i) a submission made by the creditor under section 98(1) or an indication given by the creditor under section 102(1) and the date on which such submission was made or indication was furnished, and

(ii) any alternative option available to the creditor for the recovery of the debt concerned.

(11) The registrar of the appropriate court shall notify the Insolvency Service and the personal insolvency practitioner concerned where the court makes or refuses to make an order under subsection (9).

(12) On receipt of a notification under subsection (11) of the making of an order under subsection (9), the Insolvency Service shall register the Personal Insolvency Arrangement concerned in the Register of the Personal Insolvency Arrangements.

(13) The Personal Insolvency Arrangement shall come into effect upon being registered in the Register of Personal Insolvency Arrangements.

(14) The court, in an application under this section, shall make such other order as it deems appropriate, including an order as to the costs of the application.

(15) For the purposes of its consideration of an application under this section, the appropriate court may accept—

(a) the certificate of the personal insolvency practitioner referred to in subsection (2)(d)(i) as evidence of the proportions of the respective categories of votes cast by those voting at the creditors’ meeting and of the creditors who have voted in favour of and against the proposed Personal Insolvency Arrangement and of the nature and value of the debt owed to each such creditor,

(b) the certificate of the personal insolvency practitioner referred to in subsection (2)(d)(ii) as evidence that the proposed Arrangement has not been approved in accordance with section 111A, and

(c) the statement of the personal insolvency practitioner referred to in subsection (2)(e) as evidence of any matter referred to in subsection (8) which is the subject of that statement.

(16) For the purposes of this section, a proposal for a Personal Insolvency

Arrangement is not approved in accordance with this Chapter where—

(a) at a creditors’ meeting held under this Chapter, it is not approved in accordance with section 110 or, as the case may be, deemed to have been approved under section 108(8)(a) (as amended by section 11(b) of the Personal Insolvency (Amendment) Act 2015), or

(b) in the case of a proposal for a Personal Insolvency Arrangement to which section 111A applies, the creditor concerned has notified the personal insolvency practitioner in accordance with section 111A(6) that the creditor does not approve of the proposal.

(17) (a) For the purposes of this section, and subject to paragraph (b), the court may consider—

(i) one creditor, or

(ii) more than one creditor, where the court considers the creditors to have, in relation to the debtor, interests or claims of a similar nature,

to be a class of creditor.

(b) In deciding under paragraph (a) whether to consider a creditor or creditors to be a class of creditor, the court shall have regard to the circumstances of the case, including, having regard to the statement of the grounds of the application referred to in subsection (2)(a) and the certificate referred to in subsection (2)(d)(i)—

(i) the overall number and composition of the creditors who voted at the creditors’ meeting, and (ii) the proportion of the debtor’s debts due to the creditors participating and voting at the creditors’ meeting that is represented by the creditor or creditors concerned.

(18) In this section—

‘relevant debt’ means a debt—

(a) the payment for which is secured by security in or over the debtor’s principal private residence, and

(b) in respect of which—

(i) the debtor, on 1 January 2015, was in arrears with his or her payments, or

(ii) the debtor, having been, before 1 January 2015, in arrears with his or her payments, has entered into an alternative repayment arrangement with the secured creditor concerned.”.”.

Amendment agreed to.
Bill reported with amendments.

Recommital is necessary in respect of amendment No. 14 and the other related amendments as they relate to the instruction to committee motion. Amendments Nos. 14 and 16 to 20, inclusive, are consequential on amendment No. 21 and will be discussed together.

Bill recommitted in respect of amendments Nos. 14 to 25, inclusive.

I move amendment No. 14:

In page 18, line 41, after “section” to insert “and section 119A”.

This group of amendments ensures that where a personal insolvency arrangement has been imposed by the court, under the new review procedures, it can be varied if there is a material change to the debtor's circumstances. This is an important point. Amendments Nos. 14 and 16 to 20, inclusive, are consequential amendments, while amendment No. 21 is a substantive amendment and keeps the same protection for debtors as in the existing variation provision. The amendment allows for a change in circumstances where an arrangement may have to be examined again.

Amendment agreed to.

I move amendment No. 15:

In page 21, line 28, to delete “as a notice” and substitute “as a reference to a notice”.

Amendment agreed to.

I move amendment No. 16:

In page 23, line 4, to delete “or”.

Amendment agreed to.

I move amendment No. 17:

In page 23, between lines 4 and 5, to insert the following:

“(b) under section 119A(3) to a proposal for a variation or the giving to creditors of a notice under section 119A(4), or”.

Amendment agreed to.

I move amendment No. 18:

In page 23, line 5, to delete “(b) under subsection (3)” and substitute “(c) under subsection (3)”.

Amendment agreed to.

I move amendment No. 19:

In page 23, line 31, to delete “this section” and substitute “this section or section 119A”.

Amendment agreed to.

I move amendment No. 20:

In page 23, line 38, to delete “income.”.” and substitute “income.”.

Amendment agreed to.

I move amendment No. 21:

In page 23, between lines 38 and 39, to insert the following:

“Variation of Personal Insolvency Arrangement confirmed by order under section 115A

119A. (1) Where the coming into effect of a Personal Insolvency Arrangement has been confirmed by an order of the court under section 115A(9), the

Arrangement may be varied in accordance with its terms and subject to this section.

(2) Subsections (2) to (5), and paragraphs (a) and (b) of subsection (6), of section 119 shall apply to the variation of a Personal Insolvency Arrangement under this section.

(3) Where the personal insolvency practitioner has, in accordance with section 119(6)(b), formulated a proposal for the variation of the Personal Insolvency Arrangement concerned, he or she shall without delay—

(a) seek the written consent of the debtor to the proposal and to the giving of a notice under subsection (4) to the creditors concerned, and

(b) give each creditor concerned a notice under subsection (4).

(4) A notice under this subsection shall—

(a) inform the creditor of the proposal for a variation of the Personal Insolvency Arrangement,

(b) be accompanied by—

(i) a written proposal for the variation of the Personal Insolvency Arrangement,

(ii) a report of the personal insolvency practitioner—

(I) describing the outcome for the creditors and for the debtor under the terms of the proposal, and

(II) indicating whether or not he or she is of the opinion that the debtor is reasonably likely to be able to comply with the terms of the Personal Insolvency Arrangement as varied in accordance with the proposal,

(iii) the Prescribed Financial Statement completed by the debtor under section 119(5) or (6), as the case may be,

(iv) a statement informing the creditor of the effect of subsections (7), (8), (9) and (12), and

(v) such other information obtained by the personal insolvency practitioner under this section as he or she considers relevant.

(5) The personal insolvency practitioner shall lodge a copy of a notice under subsection (4) and the documents referred to in paragraph (b) of that subsection with the Insolvency Service.

(6) The provisions of sections 99 to 105 (other than subsections (2) and (3) of section 101) and section 120 shall apply in relation to a variation of a Personal Insolvency Arrangement under this section, subject to the following modifications and any other necessary modifications—

(a) a reference to a Personal Insolvency Arrangement shall be construed as a reference to a Personal Insolvency Arrangement as varied in accordance with this Chapter,

(b) a reference to a proposal for a Personal Insolvency Arrangement shall be construed as a reference to a proposal for the variation of a Personal Insolvency Arrangement, and a reference to a proposed Personal Insolvency Arrangement shall be construed as a reference to a proposed variation of a Personal Insolvency Arrangement,

(c) a reference to a Prescribed Financial Statement shall be construed as a reference to the Prescribed Financial Statement completed by the debtor under section 119(5) or (6), as the case may be,

(d) the variation of a Personal Insolvency Arrangement shall not have the effect of extending the duration of that Personal Insolvency Arrangement beyond the maximum duration permitted under section 99(2)(b),

(e) a Personal Insolvency Arrangement as varied under this section shall, in addition to containing the information referred to in section 99(2)(f), make provision for the costs and outlays of the personal insolvency practitioner which relate to this section,

(f) a reference to a notification that a protective certificate has been issued shall be construed as a reference to a notice under subsection (4),

(g) a reference to the day or date on which a protective certificate is issued, other than in section 102(7), shall be construed as a reference to the date of the giving to the creditor of a notice under subsection (4),

(h) where section 103(3) applied to a Personal Insolvency Arrangement, the variation of that Arrangement shall not operate to alter the period referred to in section 103(11)(a), and

(i) a reference to the market value attributed to security, or the market value of security determined in accordance with section 105, shall be construed as the value attributed or determined in accordance with section 105 for the purpose of a variation under this section.

(7) A creditor shall, within 14 days of the giving to the creditor of a notice under subsection (4), notify the personal insolvency practitioner in writing of his or her approval or otherwise of the proposal for the variation of the Personal Insolvency Arrangement.

(8) Where a creditor fails to comply with subsection (7), the creditor shall be deemed to have approved the proposal concerned.

(9) Where a creditor notifies the personal insolvency practitioner in accordance with subsection (7) that the creditor does not approve of the proposal, the personal insolvency practitioner may, if the debtor so instructs him or her in writing, make an application on behalf of the debtor to the appropriate court for an order confirming the coming into effect of the Personal Insolvency Arrangement as varied in accordance with the proposal (in this section referred to as ‘an order under this section’).

(10) Where subsection (9) applies and the personal insolvency practitioner does not make an application in accordance with this section, the Personal Insolvency Arrangement concerned shall, without prejudice to the other provisions of this Act, continue in effect without being subject to such variation.

(11) Subsection (10) shall be without prejudice to the entitlement of the personal insolvency practitioner to propose another variation of the Personal Insolvency Arrangement in accordance with this section.

(12) Where no creditor notifies the personal insolvency practitioner in accordance with subsection (7) that the creditor does not approve of the proposal, the personal insolvency practitioner shall notify the Insolvency Service in writing of that fact.

(13) An application for an order under this section shall be made not less than 14 days after receipt by the personal insolvency practitioner of the notice of the creditor referred to in subsection (9) and shall be—

(a) on notice to the Insolvency Service, each creditor concerned and the debtor, and

(b) accompanied by—

(i) a copy of the documents referred to in subsection (4)(b),

(ii) a copy of the notification by the creditor referred to in subsection (9), and

(iii) a statement of the grounds of the application which shall include (other than where the Personal Insolvency Arrangement that is proposed to be varied is an Arrangement to which section 111A applied) a statement identifying the creditor or creditors who, having approved or being deemed to have approved, in accordance with this section, the proposal, should, in the opinion of the personal insolvency practitioner, be considered by the court to be a class of creditors for the purpose of this section, and giving the reasons for this opinion.

(14) Section 115A(6) to (9) shall apply in relation to an application under this section, subject to the following modifications and any other necessary modifications:

(a) a reference to a proposed Personal Insolvency Arrangement shall be construed as a reference to a proposal for the variation of a Personal Insolvency Arrangement;

(b) a reference to an order under section 115A(9) shall be construed as a reference to an order under this section; and

(c) a reference in section 115A(9)(g) to a class of creditors having accepted a proposed Arrangement shall be construed as a reference to a class of creditors having approved, or being deemed to have approved, in accordance with this section, a proposal for the variation of a Personal Insolvency Arrangement.

(15) The registrar of the appropriate court shall notify the Insolvency Service and the personal insolvency practitioner concerned where the court makes or refuses to make an order under this section.

(16) The Insolvency Service shall register in the Register of the Personal Insolvency Arrangements the variation of a Personal Insolvency Arrangement on receipt by it of a notification under—

(a) subsection (12), or

(b) subsection (15) of the making of an order under this section.

(17) The variation of a Personal Insolvency Arrangement under this section shall come into effect upon being registered in the Register of Personal Insolvency Arrangements.

(18) The court, in an application under this section, shall make such other order as it deems appropriate, including an order as to the costs of the application.”.”.

Amendment agreed to.

I move amendment No. 22:

In page 23, between lines 38 and 39, to insert the following:

“Amendment of section 159 of Principal Act

18. Section 159 of the Principal Act is amended—

(a) by the insertion of the following definition:

“ ‘authorised officer’ means a person appointed under section 176B to be an authorised officer;”,

and

(b) by the substitution of the following for the definition of “improper conduct”:

“ ‘improper conduct’, in relation to a personal insolvency practitioner,

means—

(a) the commission by the personal insolvency practitioner of an act which renders the personal insolvency practitioner no longer a fit and proper person to carry on practice as a personal insolvency practitioner,

(b) the commission by the personal insolvency practitioner of a material contravention of a provision of this Act or any regulations made thereunder, or

(c) failure by the personal insolvency practitioner to perform his or her functions under this Act in accordance with this Act and any regulations made thereunder.”.”.

Amendment agreed to.

I move amendment No. 23:

In page 23, between lines 38 and 39, to insert the following:

“Insertion in Principal Act of sections 176A to 176D

19. The Principal Act is amended by the insertion of the following after section 176:

“Supervision

176A. The Insolvency Service may, for the purpose of ensuring compliance by personal insolvency practitioners with their obligations under this Act, supervise personal insolvency practitioners in the performance of their functions under this Act.

Authorised Officers

176B.(1) For the purposes of this Act—

(a) the Director of the Insolvency Service may appoint such members of the staff of the Insolvency Service as he or she deems appropriate to be authorised officers for such period and subject to such terms as the Director may determine,

(b) the Director of the Insolvency Service may appoint such other persons as he or she deems appropriate to be authorised officers for such period and subject to such terms (including terms as to remuneration and allowances for expenses) as the Director, with the approval of the Minister and the consent of the Minister for Public Expenditure and Reform, may determine.

(2) Each authorised officer shall be given a warrant of appointment and, when performing any function imposed under this Act, shall, on request by any person affected, produce the warrant or a copy thereof, together with a form of personal identification.

(3) An appointment under this section shall cease—

(i) if the Insolvency Service revokes the appointment,

(ii) if the person appointed ceases to be a member of staff of the Insolvency Service, or

(iii) if the appointment is for a fixed period, on the expiry of that period.

(4) A revocation under this section shall be in writing.

Powers of Authorised Officers

176C. (1)For the purposes of the performance of the functions of the Insolvency Service under section 176A, an authorised officer may, in relation to a personal insolvency practitioner—

(a) subject to subsections (13) and (14), at all reasonable times enter, inspect, examine and search any premises at, or vehicles in or by means of, which any activity in connection with the practice of the personal insolvency practitioner is carried on,

(b) subject to subsections (13) and (14), enter, inspect, examine and search any dwelling occupied by the personal insolvency practitioner, being a dwelling as respects which there are reasonable grounds to believe records relating to the practice of the personal insolvency practitioner are being kept in it,

(c) without prejudice to any other power conferred by this subsection, require any person found in or on any premises, vehicle or dwelling referred to in any of the preceding paragraphs or any person in charge of or in control of such premises, vehicle or dwelling or directing any activity therein or thereto referred to in paragraph (a) to produce any records, books or accounts (whether kept in manual form or otherwise) or other documents which it is necessary for the authorised officer to see for the purposes of section 176A, and the authorised officer may inspect, examine, copy and take away any such records, books or accounts or other documents so produced or require a foregoing person to provide a copy of them or of any entries in them to the authorised officer,

(d) require any person referred to in paragraph (c) to afford such facilities and assistance within the person’s control or responsibilities as are reasonably necessary to enable the authorised officer to exercise any of the powers conferred on the authorised officer under paragraph (a), (b) or (c),

(e) require any person by or on whose behalf data equipment is or has been used in connection with an activity referred to in paragraph (a), or any person having charge of, or otherwise concerned with the operation of, such data equipment or any associated apparatus or material, to afford the authorised officer all reasonable assistance in respect of its use,

(f) require the personal insolvency practitioner, the personal insolvency practitioner’s employee or the personal insolvency practitioner’s agent to give such authority in writing addressed to such bank or banks as the authorised officer requires for the purpose of enabling the inspection of any account or accounts opened, or caused to be opened, by the personal insolvency practitioner at such bank or banks (or any documents relating thereto) and to obtain from such bank or banks copies of such documents relating to such account or accounts for such period or periods as the authorised officer deems necessary to fulfil that purpose, and

(g) be accompanied by a member of the Garda Síochána and assisted in the exercise of the officer’s powers under this Chapter by such other authorised officers, members of the Garda Síochána or other persons as the authorised officer reasonably considers appropriate.

(2) A requirement under subsection (1)(c), (d), (e) or (f) shall specify a period within which, or a date and time on which, the person the subject of the requirement is to comply with it.

(3) For the purposes of his or her supervisory functions under section 176A, an authorised officer—

(a) may require a person who, in the authorised officer’s opinion—

(i) possesses information that is relevant, or

(ii) has any records, books or accounts (whether kept in manual form or otherwise) or other documents within that person’s possession or control or within that person’s procurement that are relevant to the supervision,

to provide that information or those records, books, accounts or other documents, as the case may be, to the authorised officer,

(b) where the authorised officer deems appropriate, may require that person to attend before the authorised officer for the purpose of so providing that information or those records, books, accounts or other documents, as the case may be, and

(c) may require a person to provide an explanation of a decision, course of action, system or practice or the nature or content of any records or, where the authorised officer deems appropriate, may require that person to attend before the authorised officer for the purpose of so explaining, and the person shall comply with the requirement.

(4) A requirement under subsection (3) shall specify—

(a) a period within which, or a date and time on which, the person the subject of the requirement is to comply with the requirement, and

(b) as the authorised officer concerned deems appropriate—

(i) the place at which the person shall attend to give the information concerned or to which the person shall deliver the records, books, accounts or other documents concerned, or

(ii) the place to which the person shall send the information or the records, books, accounts or other documents concerned.

(5) A person required to attend before an authorised officer under subsection (3)—

(a) is also required to answer fully and truthfully any question put to the person by the authorised officer, and

(b) if so required by the authorised officer, shall answer any such question under oath.

(6) Where it appears to an authorised officer that a person has failed to comply or fully comply with a requirement under subsection (1), (3) or (5), the authorised officer may, on notice to that person and with the consent of the Insolvency Service, apply in a summary manner to the Circuit Court for an order under subsection (7).

(7) Where satisfied after hearing the application about the person’s failure to comply or fully comply with the requirement in question, the Circuit Court may, subject to subsection (10), make an order requiring that person to comply or fully comply, as the case may be, with the requirement within a period specified by the Court.

(8) An application under subsection (6) to the Circuit Court shall be made to a judge of that Court for the circuit in which the person the subject of the application resides or ordinarily carries on any profession, business or occupation.

(9) The administration of an oath referred to in subsection (5)(b) by an authorised officer is hereby authorised.

(10) A person the subject of a requirement under subsection (1), (3) or (5) shall be entitled to the same immunities and privileges in respect of compliance with such requirement as if the person were a witness before the High Court.

(11) Any statement or admission made by a person pursuant to a requirement under subsection (1), (3) or (5) is not admissible against that person in criminal proceedings other than criminal proceedings for an offence under subsection (15), and this shall be explained to the person in ordinary language by the authorised officer concerned.

(12) Nothing in this section shall be taken to compel the production by any person of any records, books or accounts (whether kept in manual form or otherwise) or other documents which he or she would be exempt from producing in proceedings in a court on the ground of legal professional privilege.

(13) An authorised officer shall not, other than with the consent of the occupier, enter a private dwelling without a warrant issued under subsection (14) authorising the entry.

(14) A judge of the District Court, if satisfied on the sworn information of an authorised officer that—

(a) (i) there are reasonable grounds for suspecting that any information is, or records, books or accounts (whether kept in manual form or otherwise) or other documents required by an authorised officer under this section are, held on any premises or any part of any premises, and

(ii) an authorised officer, in the performance of functions under subsection (1), has been prevented from entering the premises or any part thereof,

or

(b) it is necessary that the authorised officer enter a private dwelling and exercise therein any of his or her powers under this section,

may issue a warrant authorising the authorised officer, accompanied if necessary by other persons, at any time or times within 30 days from the date of issue of the warrant and on production if so requested of the warrant, to enter, if need be by reasonable force, the premises or part of the premises concerned and perform all or any such functions.

(15) Subject to subsection (12), a person who—

(a) withholds, destroys, conceals or refuses to provide any information or records, books or accounts (whether kept in manual form or otherwise) or other documents required for the purposes of the supervision of a personal insolvency practitioner,

(b) fails or refuses to comply with any requirement of an authorised officer under this section, or

(c) otherwise obstructs or hinders an authorised officer in the performance of functions imposed under this Act,

is guilty of an offence.

(16) Subject to subsection (17), where a personal insolvency practitioner is convicted of an offence under subsection (15), the court may, after having regard to the nature of the offence and the circumstances in which it was committed, order that his or her authorisation to carry on practice as a personal insolvency practitioner be revoked and that he or she be prohibited (which may be a permanent prohibition, a prohibition for a specified period or a prohibition subject to specified conditions) from applying for any new authorisation to carry on practice as a personal insolvency practitioner.

(17) An order under subsection (16) shall not take effect until—

(a) the ordinary time for bringing an appeal against the conviction concerned or the order has expired without any such appeal having been brought,

(b) such appeal has been withdrawn or abandoned, or

(c) on any such appeal, the conviction or order, as the case may be, is upheld.

(18) In this section, ‘records, books or accounts’ include copies of records, books or accounts.

(19) In this section, where records, books or accounts are held or maintained in electronic form, the obligation to produce or provide records, books or accounts includes an obligation to produce or provide those records, books or accounts in a legible and comprehensible printed form.

(20) Where records are not in legible form, an authorised officer, in the exercise of any of his or her powers under this section, may—

(a) operate any data equipment, including any computer, or cause any such data equipment or computer to be operated by a person accompanying the authorised officer, and

(b) require any person who appears to the authorised officer to be in a position to facilitate access to the records stored in any data equipment or computer or which can be accessed by the use of that data equipment or computer to give the authorised officer all reasonable assistance in relation to the operation of the data equipment or computer or access to the records stored in it,

including:

(i) providing the records to the authorised officer in a form in which they can be taken and in which they are, or can be made, legible and comprehensible;

(ii) giving to the authorised officer any password necessary to make the records concerned legible and comprehensible; or

(iii) otherwise enabling the authorised officer to examine the records in a form in which they are legible and comprehensible.

(21) Where an authorised officer believes upon reasonable grounds, that a person has committed an offence under this Act, he or she may require that person to provide him or her with his or her name and the address at which he or she ordinarily resides.

Notification by Authorised Officer

176D. Where it appears to an authorised officer, in the performance of his or her functions under section 176C, that improper conduct by a personal insolvency practitioner has occurred or is occurring—

(a) he or she shall notify the Insolvency Service in writing, as soon as practicable, setting out the reasons why he or she has formed that view, and

(b) the Insolvency Service shall consider the notification and, if satisfied that there is sufficient reason for so doing, may, in accordance with section 180, cause an investigation to be carried out.”.”.

Amendment agreed to.

I move amendment No. 24:

In page 23, between lines 38 and 39, to insert the following:

“Amendment of section 181 of Principal Act

20. Section 181 of the Principal Act is amended—

(a) in subsection (3)—

(i) in paragraph (a), by the substitution of “to the inspector,” for “to the inspector, and”,

(ii) in paragraph (b), by the substitution of “as the case may be, and” for “as the case may be”, and

(iii) by the insertion of the following after paragraph (b):

“(c) may require a person to provide an explanation of a decision, course of action, system or practice or the nature or any content of any records or, where the inspector deems appropriate, may require that person to attend before the inspector for the purpose of so explaining,”,

and

(b) by the insertion of the following after subsection (21):

“(22) Where records are not in legible form, an inspector, in the exercise of any of his or her powers under this section, may—

(a) operate any data equipment, including any computer, or cause any such data equipment or computer to be operated by a person accompanying the inspector, and

(b) require any person who appears to the inspector to be in a position to facilitate access to the records stored in any data equipment or computer or which can be accessed by the use of that data equipment or computer to give the inspector all reasonable assistance in relation to the operation of the data equipment or computer or access to the records stored in it, including—

(i) providing the records to the inspector in a form in which they can be taken and in which they are, or can be made, legible and comprehensible,

(ii) giving to the inspector any password necessary to make the records concerned legible and comprehensible, or

(iii) otherwise enabling the inspector to examine the records in a form in which they are legible and comprehensible.

(23) Where an inspector believes upon reasonable grounds, that a person has committed an offence under this Act, he or she may require that person to provide him or her with his or her name and the address at which he or she ordinarily resides.”.”.

Amendment agreed to.

I move amendment No. 25:

In page 23, between lines 38 and 39, to insert the following:

“Amendment of section 186 of Principal Act

21. Section 186 of the Principal Act is amended—

(a) in paragraph (b), by the deletion of “or”,

(b) by the insertion of the following after paragraph (b):

“(ba) an authorised officer appointed under section 176B, or”,

and

(c) by the substitution of “those functions relate to the supervision of personal insolvency practitioners in accordance with section 176A or to carrying out an investigation under this Part” for “those functions relate to carrying out an investigation under this Part”.”.

Amendment agreed to.
Bill reported with amendments.

I move amendment No. 26:

In page 23, between lines 38 and 39, to insert the following:

“Report by Minister

18. Within one month of the coming into force of this Act the Minister shall lay before the Houses of the Oireachtas a full review of the Principal Act.”.

The amendment is self-explanatory. We are amending the existing Act because this is a work in progress and the serious difficulties encountered by those in debt are evident in courts across the country. We hope to have a review swiftly within the period defined in the amendment.

I appreciate the Deputy’s intention in providing for a review of the Personal Insolvency Act. However, this amendment is not necessary, as the Act already provides for a statutory review. Section 141 of the Act requires the Minister for Justice and Equality to carry out a full review of the operation of insolvency arrangements under the Act, including debt relief notices, debt settlement arrangements and personal insolvency arrangements, within three years of its commencement, namely, by 31 July 2016. The review is to be completed within one year and the resulting report laid before each House of the Oireachtas. We have already completed a review of the operation of the insolvency legislation, following the Statement of Government Priorities 2014-2016, and most of the amendments I am tabling today are based on that review which was extensive in its scope. I hope for these reasons that the Deputy will consider withdrawing the amendment which would unnecessarily duplicate the review work for which the legislation already provides.

Amendment put and declared lost.

Amendments Nos. 27 and 28 are related and will be discussed together.

I move amendment No. 27:

In page 23, between lines 38 and 39, to insert the following:

“Amendment of section 161 of Principal Act

18. Section 161 of the Principal Act is amended by the insertion of the following new paragraph after paragraph (f):

“(g) where fees are charged by a personal insolvency practitioner or the Insolvency Service of Ireland in the course of their work relating to the mechanisms outlined in the Principle Act, their fees shall not exceed those as stated in January 2015.”.”.

I am resubmitting an amendment I tabled on Committee Stage. Those who engage with the Insolvency Service of Ireland face much uncertainty and are trying to bring a degree of certainty and calmness to their lives and financial position. Concern was expressed at the fees being charged by the personal insolvency practitioners, PIPs, and the Insolvency Service of Ireland. The intent of the amendment is to eliminate that variable from the process.

I informed the Deputy on Committee Stage that the amendment could not be accepted because there were no set fees for PIPs as of January 2015 and, therefore, there was no basis to the amendment. I made changes to the fees that were being charged last year. Where a PIP has done work and he or she has not been successful, there is an offsetting fee of €750 in relation to the costs incurred. The intention is to remove the barriers to people using the Insolvency Service of Ireland. There is now a much more flexible arrangement on fees in order that more people will be encouraged to use the service.

Amendment, by leave, withdrawn.
Amendment No. 28 not moved.

Recommital is required in respect of amendment No. 29 as it relates to the instruction to committee motion.

Bill recommitted in respect of amendment No. 29.

I move amendment No. 29:

In page 24, after line 5, to insert the following:

“(3) This Act shall come into operation on such day or days as may be fixed by order or orders made by the Minister for Justice and Equality, either generally or by reference to any particular purpose or provision, and different days may be so fixed for different purposes and different provisions.”.

As Deputies are well aware, the amendment is a standard provision that is particularly required in the Bill because of the court review provisions. As they will be aware, commencement of the court review provisions will need to await the completion of the rules of court which are expected to be in place in early autumn.

Amendment agreed to.
Bill reported with amendment.
Bill, as amended, received for final consideration and passed.
Sitting suspended at 7.50 p.m. and resumed at 8.10 p.m.