Directive No. 1R5, Counselling in Insolvency Matters - letter

Date: October 28, 2019

To: Licensed Insolvency Trustees

Subject:  Directive No. 1R5, Counselling in Insolvency Matters

The Office of the Superintendent of Bankruptcy (OSB) has amended Directive No. 1R4, Counselling in Insolvency Matters.


The amendments further the objectives of a two-phased renewal of the insolvency counselling requirements under the Bankruptcy and Insolvency Act (BIA) initiated in 2018. They focus on the implementation of a modern and enhanced insolvency counselling curriculum and delivery model. The amendments also reduce administrative burden for stakeholders.

Input from public consultation

The OSB received twelve (12) submissions over a thirty-day public comment period. They were carefully reviewed and considered, resulting in enhancements reflected in the new Directive and its associated forms.

Curriculum and delivery process

A number of submissions included input relevant to the updated curriculum and delivery process. Based on this, the OSB revised the requirements to:

  • Provide Licensed Insolvency Trustees (LIT) with greater flexibility in assigning counselling to BIA Insolvency Counsellors registered against another LIT’s licence;
  • Provide LITs with greater discretion as to the content of the insolvency counselling sessions in order to tailor the counselling to the individual bankrupt or consumer debtor’s needs considering the cause(s) of insolvency;
  • Remove prescription on remuneration of third-party BIA Insolvency Counsellors; and
  • Have the person who provided counselling sign the Report on Insolvency Counselling. 

Administrative burden

The new Directive and its reporting form also contain some amendments to reduce administrative burden: 

  • Condense three forms to one reporting form;
  • Eliminate the requirement to request a variance; and
  • Give LITs the option to report on insolvency counselling after one or both sessions.

Quality of the Insolvency Counselling Sessions

Comments received supported revisions to several Directive requirements and requested additional clarity to some provisions related to the quality of the insolvency counselling sessions as follows:

  • Maintain the approach that the online self-learning modules, developed to enhance and support the objectives of the mandatory in-person sessions, are optional;
  • Collect data via the reporting forms to allow the OSB to begin measuring the effectiveness of counselling; and
  • Confirm the importance of professional development among BIA Insolvency Counsellors to maintain high quality services.

Comments outside the scope of the consultation

Some feedback included comments and recommendations extending beyond the scope of the current consultation. For example, some respondents called for an increase in the $85 fee for insolvency counselling prescribed in regulation. While this was beyond the scope of the consultation, the data gathered by the new reporting form will help the OSB monitor the quality of insolvency counselling being delivered and determine if a future change to the prescribed fee is justified.

Online self-learning modules

The OSB has made available optional online self-learning modules to help enhance and support the objectives of the mandatory in-person sessions. The online content relieves LITs and/or counsellors of the burden of delivering generic financial literacy content needed by the majority of debtors, thereby providing counsellors with additional time to meet each debtor’s unique needs.

The objective of the online modules is to facilitate and enhance the in-person counselling experience for debtors. To support the implementation of the online self-learning modules, the OSB has also made an Insolvency counselling curriculum - counsellor training module that explains how the online self-learning material can be integrated into the counselling process. 


The amended Directive will come into force on January 31, 2020, and Directive No. 1R4 remains in effect until that time. As with previous Directive amendments, the time between issuance and coming into force allows for efficient and effective implementation planning by LITs. The Directive’s transitional provisions will give LITs the flexibility to report on any counselling session delivered before the coming into force of Directive No. 1R5 using either the Schedules from Directive No. 1R4 or the reporting form in Directive No. 1R5, where available. 

If you require further information regarding this Directive, please do not hesitate to contact the OSB.


Elisabeth Lang

Superintendent of Bankruptcy

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