Proposed phoenix reforms could give a free pass to shonky marketing bosses
Lawyer Ben Sewell unpacks the government’s new phoenix reform proposals, and explains why he believes they don’t go far enough.
Have you ever been burned by companies who escape their debts by doing a phoenix? If you have, you’re not alone. Unfortunately, there’s a lot of phoenix activity in the media and marketing industry.
But don’t worry – the federal government says it’s here to help [insert ironic laugh]!
The government has just released a new reform package aimed at curbing phoenix activity (which is when you transfer the assets of a failed company to another company that has no liabilities). Kelly O’Dwyer, the financial services minister, says the new rules will “deter and disrupt the core behaviours of illegal phoenixing”.
Good article Ben. Another point of note is that the director liability for GST will possibly extend the ATOs priority ranking and could possibly reduce payments available to unsecured Crs Post successful recovery proceedings.
Wes