Commentary on Sections Sequestration where debtor has few assets Section 5 – Debtor application
14.This section amends section 5 of the 1985 Act (‘Sequestration of estate of living or deceased debtor’), in order to replace the current low income, low asset route in to bankruptcy (as set out in sections 5(2B)(c)(ia) and 5A of the 1985 Act and the Bankruptcy (Scotland) Act 1985 (Low Income, Low Asset Debtors etc.) Regulations 2008 (SSI 2008/81)) with a new ‘minimal asset process’ (‘MAP’) for debtor applications under the 1985 Act, which is intended to provide debt relief to debtors who have few or limited assets(8). It allows discharge of the debtor after 6 months, but is subject to eligibility criteria and restrictions on the debtor. The criteria for the new process to apply are set out in new section 5(2ZA) to (2ZE) of the 1985 Act.
15.This section also inserts, before Schedule 1 to the 1985 Act, a new Schedule A1 to provide for the application of the Act to ‘minimal asset’ debtors, AiB’s duty to consider whether it ceases to apply, the debtor’s right of appeal against such a decision and modification of certain provisions of the Act in order to provide for the operation of the MAP.