The Insolvency Service of Ireland (ISI) announced today that it will start accepting applications on Monday the 9th of September from authorised Personal Insolvency Practitioners and Approved Intermediaries for the new debt reliefs on behalf of insolvent debtors under the Personal Insolvency Act.
“We are pleased to announce that we can start accepting applications on behalf of people who are insolvent very shortly,” said Mr. Lorcan O’Connor, Director, ISI. “This is the culmination of intensive efforts since the ISI’s establishment in March of this year to bring about the necessary infrastructure to facilitate the operation of the three new debt reliefs introduced by the Personal Insolvency Act, as amended.”
1) Announcement of date for Debt Relief Notices and Protective Certificates
The ISI will begin accepting applications for Debt Relief Notices and Protective Certificates linked to applications for Debt Settlement Arrangements and Personal Insolvency Arrangements from Monday 9th September.
In advance of this date, insolvent debtors can arrange to meet with duly authorised Personal Insolvency Practitioners or Approved Intermediaries to discuss their situation.
The ISI will also be publishing a number of statutory instruments on the 2nd of September that underpin the three new debt relief processes before this date. These will be available on the ISI’s website at: http://www.isi.gov.ie/en/ISI/Pages/Legislation
2) Authorisation of Personal Insolvency Practitioners (PIPs) and Approved Intermediaries (AIs)
The ISI began authorising PIPs and AIs earlier this month. The ISI is currently processing a large number of practitioner applications. The number of authorised PIPs and AIs are expected to increase over the coming weeks.
An AI is a person or class of persons authorised by the ISI to support a debtor to make an application for a Debt Relief Notice. A number of Money Advice and Budgeting Services (MABS) have been authorised or have indicated their intention to apply for authorisation. MABS will provide details of how to arrange a meeting with an AI shortly.
A PIP is a person authorised by the ISI to assist those who wish to put in place a Debt Settlement Arrangement or Personal Insolvency Arrangement. Details of those who have been authorised are contained on the relevant Register on the ISI website.
Only those Practitioners on the Registers can develop and process an application on behalf of insolvent debtors. http://www.isi.gov.ie/en/ISI/Pages/Registers
3) Consultation with Stakeholders
The ISI is organising a consultation around an example Personal Insolvency Arrangement (PIA) that it has created. The example represents an extension of one of the sample PIA scenarios already on the ISI website, subject to a small number of changes.
The rationale behind the drafting of such a document is to ensure that stakeholders are aware of the possible content and structure of a PIA. The consultation period offers stakeholders the opportunity to review the draft and highlight any changes or additions to the draft that they believe would help ensure the smooth introduction of this new debt relief provided for under the Act.
The consultation period closes on Friday the 6th September and the ISI hopes to publish the document in final form by mid September. For further details visit the Publications section of the website (the consultation document is located at the end of the page): http://www.isi.gov.ie/en/ISI/Pages/Publications
It is also the ISI’s intention to create a formal Consultative Committee in the autumn involving representatives of Practitioners, creditors and debtors to address areas of common interest. The ISI’s medium to long term objective is to agree a Protocol involving creditors and Practitioners similar to the IVA Protocol that exists in the UK. The IVA Protocol in the UK has resulted in high levels of creditor acceptances.
Key features include the following:
· A standardised approach for the format of presenting a debtor’s proposal to his/her creditors;
· An agreed set of standard Terms and Conditions;
· Greater transparency for all stakeholders.
4) New PIA Sample Scenario Incorporating a Split Mortgage Arrangement
To help explain some of the concepts contained in the Personal Insolvency legislation, the ISI has created some possible scenarios to illustrate how each of the three schemes may operate in respect of a debtor, Personal Insolvency Practitioner or an Approved Intermediary, creditors and the Court. These possible scenarios are for illustrative purposes only as to how a particular arrangement might work in practice and assumes a pragmatic and realistic response by creditors.
The majority of sample scenarios were published during the ISI’s Information Campaign launch in April of this year. These scenarios were updated in June to reflect CPI adjustments to the ISI’s guidelines for a Reasonable Standard of Living and Reasonable Living Expenses. In addition, new sample scenarios were published in June which contain excludable debt due to the Revenue Commissioners. Today the ISI publishes one further sample scenario which incorporates a split mortgage as part of a PIA solution. It is available in the Publications section of the ISI website at http://www.isi.gov.ie/en/ISI/Pages/Publications
5) Revenue and Creditor Guidance for Practitioners
The ISI welcomes the publication by the Revenue Commissioners of their guidance note to AIs and PIPs. A link to this note is available on ISI’s website: http://www.isi.gov.ie/en/ISI/Pages/Links
Such guidance will be of assistance to AIs and PIPs as they submit DRN applications or develop DSA or PIA proposals. The ISI understands that a number of other creditors are also developing guidance notes to assist Practitioners. The ISI encourages creditors to publish such guidance notes in the near future.