Registration of individuals as approved liquidators or as PAs for the purpose of becoming judicial managers

(i) Individuals who wish to act as Approved Liquidators or Judicial Managers upon commencement of IRDA

Under the IRDA that takes effect on 30 Jul 2020, individuals who wish to act as a liquidator, Judicial Manager (JM) or Trustee in Bankruptcy (TIB) are required to be registered as Insolvency Practitioners (IP) with the Ministry of Law for the purpose of undertaking new winding up, JM or TIB cases that are commenced on or after the IRDA comes into effect. Accordingly, ACRA will not be accepting new applications to be Approved Liquidators (ALs) or public accountants for the purpose of becoming Judicial Managers (JM-PAs). More information on the new regime for insolvency practitioners can be found at https://lripd.mlaw.gov.sg

(ii) Approved Liquidators (ALs)

With effect from 30 Jul 2020, all ALs will be declared by the Minister by way of order under section 9(1) of the Companies Act^[1] to be a specified class of persons. Persons in this class of ALs can be appointed as (a) liquidators of any winding up cases commenced under the Companies Act or LLP Act and outstanding at the time the IRDA comes into effect (pre-IRDA cases), including as replacement liquidators of such cases when the appointed liquidators resign or cease to be approved liquidators; and (b) liquidators of winding up cases in relation to Variable Capital Companies and its sub funds (VCC) during the interim period until the VCC Act has been updated to allow IPs to undertake such work.

These ALs need not renew their existing AL licence upon its expiry. The AL licence will remain valid unless it is cancelled voluntarily or revoked by ACRA on grounds such as bankruptcy etc. 

(iii) JM-PAs who are currently appointed as Judicial Managers

JM-PAs who are appointed as JMs or TIBs of companies placed under judicial management or a bankruptcy order before the commencement of the IRDA, for which the JM or TIB work is ongoing, will be allowed, upon application for renewal and subject to meeting renewal requirements, to renew their PA registration until the completion of these cases. This is to avoid any disruption to these cases.

JM-PAs who are not appointed as JMs or TIBs of companies placed under judicial management or a bankruptcy order before the commencement of the IRDA will not be allowed to renew their registration as public accountants when their current certificate of registration expires. They are required to be registered as IPs with MinLaw to undertake JM or TIB work that commenced under the IRDA.

Transition Period

The IRDA provides for a transitional period of 6 months from 30 Jul 2020 to 29 Jan 2021 (both dates inclusive), during which ALs and JM-PAs may act as liquidator or JM or TIB for cases commenced under the IRDA while they apply to MinLaw to be registered as IPs. However, should their IP application be rejected, they will have to cease their appointment for these cases commenced under the IRDA. ALs and JM-PAs who have undertaken insolvency or JM or TIB appointments in cases commenced under the IRDA during the 6-month transitional period will be required to hold a valid IP licence in order to continue administering these cases after the transitional period.

Please refer to Table 1 and 2 below for a summary of the impact of IRDA on ALs and JM-PAs respectively.

JM-PAs who are appointed as JM or TIB and for which the JM or TIB work is not completed before 30 July 2020 are known as JM-PAs with pre-IRDA cases. 

Timeline

Resources

• More information on the new regime for insolvency practitioners can be found at https://lripd.mlaw.gov.sg

• FAQs on Impact of IRDA on ALs and JM-PAs [PDF, 162 KB]

^[1] Section 9(1) of the Companies Act states that “The Minister may, by order published in the Gazette, declare that persons within a specified class of persons shall be approved liquidators for the purposes of this Act.