Creditors’ schemes of arrangement: lessons from Twinza Oil

27 May 2026

Creditors’ schemes of arrangement remain a relatively underused tool in the Australian restructuring landscape. In practice, the time, cost and procedural complexity of a scheme, combined with the absence of an automatic moratorium on creditor enforcement, often see parties default to cheaper, faster and more flexible options such as deeds of company arrangement.

However, when deployed in the right circumstances, schemes remain a powerful restructuring mechanism – particularly where there is a need to cram down dissenting or unresponsive creditors within a secured creditor class, which is not possible under a DOCA without unanimous secured creditor consent.

The recent Twinza Oil restructuring underscores the strategic value of creditors’ schemes, but also the execution and litigation risks that accompany them, especially where valuation issues are contested.

The Twinza case is also notable as the first Australian creditors’ scheme progressed alongside an active receivership appointment by secured lenders, reinforcing the flexibility of the scheme regime when carefully coordinated.

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