President assent to the Corporate Restructuring and Insolvency Act 2020 (Act 1015)

May 12, 2020 / Comments (0)

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The Ghana Association of Restructuring and Insolvency Advisors (GARIA), is pleased to announce that His Excellency the President of the Republic, Nana Addo Dankwa Akufo-Addo, has today assented to the Corporate Restructuring and Insolvency Act, 2020 (Act 1015.)

This Act could not have come at a more fortuitous time as the country discusses strategies and ways to restore and recover from the economic meltdown brought about by the COVID-19 pandemic. Businesses will have a new tool in their arsenal as they rebuild their businesses as they try to survive the devastation wrought by the ongoing pandemic.

This new law modernizes our Corporate Insolvency regime and repeals the Bodies Corporate (Official Liquidations) Act, 1963 (Act 180.)
Among the key provisions of this new law is the introduction of the rescue culture, which seeks to assist viable but temporarily distressed companies to turn around their operations to save jobs, protect the assets of the company, and right of creditors, allowing for an efficient, timely and impartial restructuring proceedings.

Other Key Features of this new law include:

  • Establishment of an insolvency division under the Office of the Registrar of Companies
  • Introduction of qualifications and a regulatory regime for Insolvency Practitioners (IPs) i.e.
    Receivers, Managers, Administrators, Restructuring Officers, Liquidators, and Trustees in
  • Introduction of Post-Commencement financing with a superior ranking over other debt for
    companies in administration
  • Cross Border Insolvency Proceedings
  • Ring-Fencing of Netting Agreements for Qualified Financial Contracts
  • Enhancements in Insolvency Proceedings
  • Sanctions for Insolvent trading and enhanced governance structures
  • Improved creditor involvement in insolvency processes

GARIA is immensely grateful to all stakeholders who contributed to today’s success including the Executive, Parliamentarians, Practitioners, our collaborators, and our Development Partners, Platinum Sponsors, and others who worked with us on this thirteen-year journey.

It is expected that the passage of this Bill, together with its Companion Act, the Companies Act, 2019 (Act 992), will go a long way to improve Ghana’s relative standing of 118 out of the 190 jurisdictions on the World Bank’s “Ease of Doing Business” League Table and make Ghana a more attractive investment destination.

Source: Ghanaweb

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