Corporations Act 2001

CHAPTER 5 - EXTERNAL ADMINISTRATION  

PART 5.3B - RESTRUCTURING OF A COMPANY  

Note: This Part does not apply to a CCIV or a sub-fund of a CCIV: see Division 4 of Part 8B.6 .

Division 4 - The restructuring practitioner  

Subdivision A - Qualifications of restructuring practitioners  

SECTION 456C   DISQUALIFICATION OF PERSON CONNECTED WITH COMPANY  

456C(1)    
Subject to this section, a person must not, except with the leave of the Court, seek or consent to be appointed as, or act as, restructuring practitioner for a company or for a restructuring plan if:

(a)    the person, or a body corporate in which the person has a substantial holding, is indebted in an amount exceeding $5,000 to the company or to a body corporate related to the company; or

(b)    the person is, otherwise than in a capacity as:

(i) administrator or liquidator of the company or a related body corporate; or

(ii) administrator of a deed of company arrangement executed by the company or a related body corporate; or

(iii) restructuring practitioner for the company or a related body corporate; or

(iv) restructuring practitioner for a restructuring plan made by the company or a related body corporate;

a creditor of the company or of a related body corporate in an amount exceeding $5,000; or

(c)    the person is a director, secretary, senior manager or employee of the company; or

(d)    the person is a director, secretary, senior manager or employee of a body corporate that is a secured party in relation to property of the company; or

(e)    the person is an auditor of the company; or

(f)    the person is a partner or employee of an auditor of the company; or

(g)    the person is a partner, employer or employee of an officer of the company; or

(h)    the person is a partner or employee of an employee of an officer of the company.

456C(2)    
An offence based on subsection (1) is an offence of strict liability.

456C(3)    
For the purposes of paragraph (1)(a) , disregard a debt owed by a natural person to a body corporate if:

(a)    the body corporate is:

(i) an Australian ADI; or

(ii) a body corporate registered under section 21 of the Life Insurance Act 1995 ; and

(b)    the debt arose because of a loan that the body corporate or entity made to the person in the ordinary course of its ordinary business; and

(c)    the person used the amount of the loan to pay the whole or part of the purchase price of premises that the person uses as their principal place of residence.

456C(4)    
For the purposes of this section, a person is taken to be a director, secretary, senior manager, employee or auditor of a company if:

(a)    the person is or has, within the last 2 years, been a director, secretary, senior manager, employee, auditor or promoter of the company or a related body corporate; and

(b)    ASIC has not directed that the person not be taken to be a director, secretary, senior manager, employee or auditor for the purposes of this section.

ASIC may give a direction under paragraph (b) only if it thinks fit in the circumstances of the case.

456C(5)    
For the purposes of paragraphs (1)(g) and (h) , officer does not include liquidator.