This is the AID and BCA’s joint submission to the Review of the Insolvent Trading Safe.
Our strong view is that the Safe Harbour has been a successful insolvency policy reform that has driven changes in director behaviour to focus on restructuring businesses. This contrasts with directors being incentivised by threat of personal liability to place a business prematurely into administration.
This has directly resulted in economic benefits through preserving employment, owner equity, providing greater returns to creditors and maintaining tax receipts.