Submission to Senate Economics Legislation Committee on Corporations Amendment (Phoenixing and Other Measures) Bill 2012

• Date:11 Apr 2012
• Type:Policy Submission

This submission, lodged with the Senate Economics Legislation Committee, is regarding the Corporations Amendment (Phoenixing and Other Measures) Bill 2012. The Bill gives ASIC powers to wind up companies if particular conditions are met, allows for the publication of external administration notices on a public website and requires insolvency practitioners to notify the government department administering the paid parental leave scheme of an insolvency event.

In summary, our comments were as follows:

(a) We support effective efforts to reduce fraudulent phoenix activity;

(b) However, we have concerns about draft legislation being said to target fraudulent phoenix activity when the draft legislation is not limited to instances where fraudulent phoenix activity is suspected;

(c) If the purpose of particular amendments is to address phoenix behaviour then ASIC’s power should be triggered only when phoenix behaviour is suspected and the legislation should unequivocally reflect this purpose; and

(d) To confine ASIC’s powers to instances where phoenix activity is suspected, a definition of ‘fraudulent phoenix activity’ should be included in the Bill.

Download our Submission to the Senate Economics Legislation Committee on the Corporations Amendment Bill (Phoenixing and Other Measures) 2012 (PDF 899KB)