THE CORPORATIONS LAW

CCH Note: Part 13 of the Corporations Act 1989, inserted by sec 6 of No 110 of 1990, Sch 1 (effective 1 January 1991), begins as follows:

PART 13 - THE CORPORATIONS LAW
THE CORPORATIONS LAW 82
The Corporations Law is as follows:...

CHAPTER 5 - EXTERNAL ADMINISTRATION

PART 5.7B - RECOVERING PROPERTY OR COMPENSATION FOR THE BENEFIT OF CREDITORS OF INSOLVENT COMPANY

View history note

Division 5 - Liability of holding company for insolvent trading by subsidiary

View history note

SECTION 588V WHEN HOLDING COMPANY LIABLE

View history reference

588V(1) [Holding company of company incurring debt]

A corporation contravenes this section if:

(a) the corporation is the holding company of a company at the time when the company incurs a debt; and

(b) the company is insolvent at that time, or becomes insolvent by incurring that debt, or by incurring at that time debts including that debt; and

(c) at that time, there are reasonable grounds for suspecting that the company is insolvent, or would so become insolvent, as the case may be; and

(d) one or both of the following subparagraphs applies:

(i) the corporation, or one or more of its directors, is or are aware at that time that there are such grounds for so suspecting;

(ii) having regard to the nature and extent of the corporation's control over the company's affairs and to any other relevant circumstances, it is reasonable to expect that:
(A) a holding company in the corporation's circumstances would be so aware; or

(B) one or more of such a holding company's directors would be so aware; and

(e) that time is at or after the commencement of this Part.

View history note

588V(2) [No offence]

A corporation that contravenes this section is not guilty of an offence.

View history note

Disclaimer and notice of copyright applicable to materials provided by CCH Australia Limited

CCH Australia Limited ("CCH") believes that all information which it has provided in this site is accurate and reliable, but gives no warranty of accuracy or reliability of such information to the reader or any third party. The information provided by CCH is not legal or professional advice. To the extent permitted by law, no responsibility for damages or loss arising in any way out of or in connection with or incidental to any errors or omissions in any information provided is accepted by CCH or by persons involved in the preparation and provision of the information, whether arising from negligence or otherwise, from the use of or results obtained from information supplied by CCH.

The information provided by CCH includes history notes and other value-added features which are subject to CCH copyright. No CCH material may be copied, reproduced, republished, uploaded, posted, transmitted, or distributed in any way, except that you may download one copy for your personal use only, provided you keep intact all copyright and other proprietary notices. In particular, the reproduction of any part of the information for sale or incorporation in any product intended for sale is prohibited without CCH's prior consent.