Canada looks forward to insolvency reform

In November last year, Canada's Bill C-55 proposing sweeping changes to the country's insolvency statutes received Royal Assent. The bill received assent on an expedited basis to ensure it was passed before the dissolution of Parliament ahead of last month's elections. This political impetus came in large part from the government's belief that the bill will protect unpaid wages and pensions. But the reforms will also clarify the scope of judicial discretion in insolvency matters in order to bring greater certainty and predictability to Canada's insolvency regime.

The then incumbent Liberal government responded to claims that there had been too little time to review and debate the bill and that the bill had a number of technical drafting errors. With the support of all political parties the government gave assurances that Bill C-55 would not come into force before June 30 2006 to provide additional time to review and implement...