Nick Sherry (Tasmania, Australian Labor Party, Minister for Superannuation and Corporate Law) Share this | Hansard source

In closing the debate, I would firstly like to thank those senators who spoke on the Cross-Border Insolvency Bill 2008. The bill gives effect to the model law on cross-border insolvency adopted by the United Nations Commission on International Trade Law. The model law provides a streamlined approach to dealing with instances of cross-border insolvency. This streamlined approach will improve the fairness and efficiency of such proceedings, thereby providing better outcomes for creditors, employees and other stakeholders.

Adoption of a model law does not change Australia’s substantive insolvency laws. The model law provides procedural rules that will allow for access to Australian courts for foreign representatives and cooperation between courts in proceedings that have a cross-border element.

Over the last 15 years the international community has devoted much effort to improving the international financial architecture. This is work that is obviously needed in a whole range of areas, given the flow of international capital across borders in the financial sector. Effective cross-border insolvency arrangements have the potential to improve the operation of the global financial system, providing long-term benefits to Australian businesses. In this regard the model law has already been adopted by a number of Australia’s trading partners, including the United States, the UK and Japan.

The bill will assist in maintaining Australia’s reputation as a destination for international capital flows by ensuring that investors have confidence in Australia’s arrangements for dealing with cases of cross-border insolvency. The efficient and effective administration of cross-border insolvency proceedings will provide benefits to all participants. To the extent that such proceedings are conducted in a more efficient manner, there will be more assets available to distribute to creditors and less money wasted on unnecessary litigation and other administrative costs.

Senator Murray did raise the fact that there are other cross-border issues that this bill does not address. That is certainly correct. The government will obviously be continuing work in this area. This legislation has been a long time in preparation and the issues have been under consideration I think as far back as the former Attorney-General, Mr Lavarch, which is more than 12 years ago, to the best of my recollection, and the previous Labor government. So the government is aware that this bill will not address all the complexities and uncertainties that arise in this area. However, it is an important step. As I said, it will bring us into line with other jurisdictions. We will continue our work on cross-border insolvency through bodies such as UNCITRAL—I will not indicate what that stands for but it is an impressive acronym—and the Forum for Asian Insolvency Reform.

To conclude, I note that the opposition shadow minister, Senator Coonan, indicated that they regarded the legislation as uncontroversial. I certainly hope so, because it is in fact a bill adopted without change from the previous government. Not one word, not one letter is changed—every ‘t’ is crossed the same way; every ‘i’ is dotted—so I would have been amazed if the now opposition had opposed or amended legislation which was certainly drafted and prepared by them and I think at some point considered in the House of Representatives. I would have to double-check on that.

It is an example of bipartisan cooperation where we believe it is necessary in our Australian financial system to deal with issues such as cross-border insolvency. I thank senators for their contributions.

Question agreed to.

Bill read a second time.