Bankruptcy (Insolvency Practice Schedule) Delegations 2026

The Bankruptcy (Insolvency Practice Schedule) Delegations 2026 is a Commonwealth notifiable instrument made under the Bankruptcy Act 1966. Its role is narrow but important. It delegates one specific Ministerial power connected with committees that perform functions relating to registering and disciplining trustees.

This means the instrument is about decision-making authority inside the personal insolvency regulatory system. It does not create a new insolvency process, alter the ordinary rights of creditors or bankrupts, or operate as a general compliance code for everyday businesses. Instead, it identifies the power being delegated, who may exercise it, and the limits that apply when that power is used.

For business owners, the practical value is usually indirect. If your business is simply trading and has no connection to trustee registration, trustee discipline or a personal bankruptcy matter, this instrument is unlikely to create a direct action item. Its importance rises when a trustee-related process is under review and someone needs to confirm whether a committee appointment was made by a valid decision-maker under the correct legislative pathway.

The instrument defines the relevant delegated power as the Minister's power to appoint a person to a committee under four paragraphs in Schedule 2 to the Bankruptcy Act 1966. Those paragraphs are 20-10(2)(c), 20-45(2)(c), 40-45(2)(c) and 40-75(2)(c).

The instrument itself does not restate the full content of those Schedule 2 provisions. What it does make clear is that each of those paragraphs is a committee appointment provision, and that the delegation only extends to those appointment functions. So if you are checking whether a delegate acted within power, the first step is to confirm that the appointment in question falls within one of those four paragraphs.

This matters because the delegation is not framed as a broad insolvency delegation across all trustee or committee matters. It is tied to the specific appointment power defined in section 4 and then delegated in section 5. If a matter sits outside those four paragraphs, this instrument may not be the right authority to rely on.

The people most directly affected are those working within, or closely with, the personal insolvency trustee framework. That includes registered trustees, applicants for registration, insolvency lawyers, insolvency accountants, AFSA decision-makers and professionals who may be considered for committee appointment.

Most ordinary businesses are outside the direct operating scope. A retailer, hospitality business, consultancy or trade business does not need to change its day-to-day conduct because this instrument commenced. But the instrument can still matter indirectly where a business owner enters personal bankruptcy, where a professional firm is advising on trustee regulation, or where a dispute turns on whether a committee was properly constituted.

For businesses that refer clients into bankruptcy or debt solutions, the instrument is also useful background. It helps explain part of the regulatory chain behind trustee registration and disciplinary processes, even though it does not itself set out the whole process.

Section 5 is the core delegation clause. Under subsection 10(1) of the Bankruptcy Act 1966, each person holding, occupying or performing the duties of the following offices or positions in AFSA, being an officer of the Commonwealth, is delegated the Minister's power to appoint a person to a committee.

The two delegated classes are the AFSA Chief Executive and an AFSA SES employee. The wording is important because it is not limited only to a permanent officeholder. It also covers a person occupying or performing the duties of the relevant office or position, provided they are an officer of the Commonwealth.

For businesses and advisers, this means a committee appointment does not need to have been made personally by the Minister to be valid. But it does need to have been made by a person within the delegated class described in section 5, and the appointment must also comply with the direction in section 6.

The delegation is not unrestricted. Section 6 gives a direction to the delegate. For the purposes of the four Schedule 2 paragraphs named in the instrument, a person delegated the Minister's power under section 5 must only exercise the power to appoint a person if the person to be appointed is listed in subsection 6(2).

That means the delegate cannot simply choose any person they consider suitable. The instrument narrows the field to a fixed list of named individuals. This is one of the most important practical features of the instrument because it creates a clear check for anyone reviewing the validity of an appointment.

If you are advising on a live matter, there are at least two threshold questions. Was the appointment made by a valid delegate under section 5? And was the appointee one of the people listed in subsection 6(2)? If the answer to either question is no, you would need to look closely at the legal basis for the appointment.

Subsection 6(2) lists the people who may be appointed by a delegate under the instrument. The listed persons are:

For practical purposes, this list is central. If a delegate under section 5 appoints someone outside this list, the appointment would not match the direction in section 6. If you are a professional firm, it is sensible to keep a current copy of the instrument on file when advising on trustee committee matters.

The instrument also includes a note stating that the persons listed in subsection 6(2) are to be reviewed periodically. The instrument does not say how often that review occurs or what criteria are used for updating the list. So if your matter is current and important, do not rely on an old copy without checking the latest in-force version.

The instrument does more than list names. Note 2 to section 6 says that a person is to be appointed to a committee only if the Minister, or their delegate, is satisfied that the person is qualified for appointment by virtue of their knowledge of, or experience in, one or more fields, and it refers readers to section 50-10 in Schedule 2 to the Act.

This is an important practical safeguard. Being named in subsection 6(2) does not remove the need for the decision-maker to be satisfied about qualifications. The instrument does not reproduce the full content of section 50-10, so users should not assume the qualification question is answered by the list alone.

If your business or practice is reviewing an appointment, the safer approach is to check both layers. First, is the appointee on the listed names? Second, was the Minister or delegate satisfied that the person met the qualification requirement referred to in section 50-10? The instrument points clearly to both requirements.

Many businesses will only need this instrument when a specific issue arises. One common trigger point is a personal bankruptcy matter involving a sole trader, director or guarantor where a registered trustee becomes central to the process. Another is where a law firm or accounting practice is advising on trustee registration, a complaint against a trustee, or a disciplinary pathway.

A further trigger point is process review. If a party wants to understand whether a committee was properly formed, this instrument helps identify the source of appointment power and the limits on that power. It will not answer every procedural question, but it is a key starting point for checking authority.

For professional practices, this is also a document control issue. If your team advises on insolvency regulation, it is worth having a standard check that covers the current instrument, the relevant Schedule 2 provisions, and the qualification requirement referred to in section 50-10.

The instrument was made on 9 April 2026 and registered on 13 April 2026. Under the commencement table in section 2, the whole instrument commenced the day after registration, which means 14 April 2026.

The official register shows the instrument as in force. Even so, users should remember that the commencement table only deals with the instrument as originally made, and the list of named persons is noted as being reviewed periodically. If you are relying on the instrument for a current matter, check the latest in-force version rather than an older saved copy.

This instrument should be read together with the Bankruptcy Act 1966, especially Schedule 2. The instrument tells you who may exercise the appointment power and who may be appointed by a delegate, but it does not set out the full committee framework or all surrounding procedures.

Before relying on it in a live matter, check that you are using the current in-force version on the Federal Register of Legislation. Confirm the appointment falls within one of the four Schedule 2 paragraphs named in the definition section. Confirm the decision-maker fits within section 5. Confirm the appointee is one of the listed persons in subsection 6(2). Then check the qualification requirement referred to in section 50-10.

If the validity of an appointment could affect a dispute, disciplinary process or regulatory outcome, a closer legal review is sensible. This is especially so because the instrument itself notes that the listed persons are reviewed periodically, which means the list may not stay static over time.