Ireland’s bankruptcy laws are among the most archaic and stringent in Europe. No automatic right to discharge exists under the Bankruptcy Act 1988 and bankruptcy can last for at least 12 years. Consequently, the process is not widely utilised, with most debtors having recourse instead to either informal or statutory schemes of arrangements with creditors. Creditors rarely pursue bankruptcy of debtors due to the high costs of the High Court process and the limited prospect of any real return. It is a last resort from both parties’ point of view.
The phrase ‘bankruptcy tourism’ has been coined to describe the recent phenomenon of debtors leaving their own country, or the country where they have accumulated debts, to be declared bankrupt in another jurisdiction.
