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Corporations Amendment (Insolvency) Bill 2007

Schedule 1 Improving outcomes for creditors

Part 1 Enhancing protection of employee entitlements

Corporations Act 2001

1  Section 9

Insert:

eligible employee creditor , in relation to a company, means a creditor whose debt or claim would, in a winding up of the company, be payable in priority to other unsecured debts and claims in accordance with paragraph 556(1)(e), (g) or (h) or section 560 or 561.

2  Section 9

Insert:

superannuation guarantee charge has the same meaning as in the Superannuation Guarantee (Administration) Act 1992 .

3  Section 9

Insert:

superannuation guarantee shortfall has the same meaning as in the Superannuation Guarantee (Administration) Act 1992 .

4  Before section 444E

Insert:

444DA   Giving priority to eligible employee creditors

             (1)  A deed of company arrangement must contain a provision to the effect that, for the purposes of the application by the administrator of the property of the company coming under his or her control under the deed, any eligible employee creditors will be entitled to a priority at least equal to what they would have been entitled if the property were applied in accordance with sections 556, 560 and 561.

             (2)  However, the rule in subsection (1) does not apply if:

                     (a)  at a meeting of eligible employee creditors held before the meeting convened under section 439A, the eligible employee creditors pass a resolution agreeing to the non-inclusion of such a provision; or

                     (b)  the Court makes an order under subsection (5) approving the non-inclusion of such a provision.

Meeting of eligible employee creditors

             (3)  The administrator of the company must convene a meeting under paragraph (2)(a) by giving written notice of the meeting to as many of the eligible employee creditors as reasonably practicable at least 5 business days before the meeting.

             (4)  A notice under subsection (3) must be accompanied by a copy of a statement setting out:

                     (a)  the administrator’s opinion whether the non-inclusion of such a provision would be likely to result in the same or a better outcome for eligible employee creditors as a whole than would result from an immediate winding up of the company; and

                     (b)  his or her reasons for that opinion; and

                     (c)  such other information known to the administrator as will enable the eligible employee creditors to make an informed decision about the matter covered by paragraph (a).

Court approval

             (5)  The Court may approve the non-inclusion of such a provision if the Court is satisfied that the non-inclusion of the provision would be likely to result in the same or a better outcome for eligible employee creditors as a whole than would result from an immediate winding up of the company.

             (6)  The Court may only make an order under subsection (5) on the application of:

                     (a)  the administrator, or proposed administrator, of the deed; or

                     (b)  an eligible employee creditor; or

                     (c)  any interested person.

             (7)  The Court may make an order under subsection (5) before or after the meeting convened under section 439A.

444DB   Superannuation contribution debts not admissible to proof

Whole of superannuation contribution debt

             (1)  A deed of company arrangement must contain a provision to the effect that the administrator of the deed must determine that the whole of a debt by way of a superannuation contribution is not admissible to proof against the company if:

                     (a)  a debt by way of superannuation guarantee charge:

                              (i)  has been paid; or

                             (ii)  is, or is to be, admissible to proof against the company; and

                     (b)  the administrator of the deed is satisfied that the superannuation guarantee charge is attributable to the whole of the first-mentioned debt.

             (2)  If the administrator of a deed of company arrangement determines, under a provision covered by subsection (1), that the whole of a debt is not admissible to proof against the company, the whole of the debt is extinguished.

Part of superannuation contribution debt

             (3)  A deed of company arrangement must contain a provision to the effect that the administrator of the deed must determine that a particular part of a debt by way of a superannuation contribution is not admissible to proof against the company if:

                     (a)  a debt by way of superannuation guarantee charge:

                              (i)  has been paid; or

                             (ii)  is, or is to be, admissible to proof against the company; and

                     (b)  the administrator of the deed is satisfied that the superannuation guarantee charge is attributable to that part of the first-mentioned debt.

             (4)  If the administrator of a deed of company arrangement determines, under a provision covered by subsection (3), that a part of a debt is not admissible to proof against the company, that part of the debt is extinguished.

Definition

             (5)  In this section:

superannuation contribution has the same meaning as in section 556.

5  After section 553AA

Insert:

553AB   Superannuation contribution debts not admissible to proof

Whole of superannuation contribution debt

             (1)  In a winding up, the liquidator must determine that the whole of a debt by way of a superannuation contribution is not admissible to proof against the company if:

                     (a)  a debt by way of superannuation guarantee charge:

                              (i)  has been paid; or

                             (ii)  is, or is to be, admissible to proof against the company; and

                     (b)  the liquidator is satisfied that the superannuation guarantee charge is attributable to the whole of the first-mentioned debt.

             (2)  If the liquidator determines, under subsection (1), that the whole of a debt is not admissible to proof against the company, the whole of the debt is extinguished.

Part of superannuation contribution debt

             (3)  In a winding up, the liquidator must determine that a particular part of a debt by way of a superannuation contribution is not admissible to proof against the company if:

                     (a)  a debt by way of superannuation guarantee charge:

                              (i)  has been paid; or

                             (ii)  is, or is to be, admissible to proof against the company; and

                     (b)  the liquidator is satisfied that the superannuation guarantee charge is attributable to that part of the first-mentioned debt.

             (4)  If the liquidator determines, under subsection (3), that a part of a debt is not admissible to proof against the company, that part of the debt is extinguished.

Definition

             (5)  In this section:

superannuation contribution has the same meaning as in section 556.

6  Paragraph 556(1)(e)

Omit “and superannuation contributions”, substitute “, superannuation contributions and superannuation guarantee charge”.

7  After subsection 556(1A)

Insert:

       (1AB)  For the purposes of paragraph (1)(e), if:

                     (a)  the company has a superannuation guarantee shortfall for a quarter; and

                     (b)  the shortfall relates to one or more employees; and

                     (c)  the quarter ends before the relevant date;

superannuation guarantee charge in respect of the quarter is taken to be payable by the company in respect of services rendered to the company by those employees before the relevant date.

       (1AC)  If:

                     (a)  the company has a superannuation guarantee shortfall for a quarter; and

                     (b)  the shortfall relates to one or more employees; and

                     (c)  the relevant date occurs during the quarter; and

                     (d)  the relevant date is not the first day of the quarter;

then:

                     (e)  for the purposes of paragraph (1)(e), so much of the superannuation guarantee charge in respect of the quarter as is attributable to the period before the relevant date is taken to be payable by the company in respect of services rendered to the company by those employees before the relevant date; and

                      (f)  the remainder of the superannuation guarantee charge in respect of the quarter is taken:

                              (i)  to be an expense referred to in paragraph (1)(a); and

                             (ii)  not to be an amount of superannuation guarantee charge referred in paragraph (1)(e).

       (1AD)  If:

                     (a)  the company has a superannuation guarantee shortfall for a quarter; and

                     (b)  the shortfall relates to one or more employees; and

                     (c)  the relevant date is the first day of the quarter;

the superannuation guarantee charge in respect of the quarter is taken:

                     (d)  to be an expense referred to in paragraph (1)(a); and

                     (e)  not to be an amount of superannuation guarantee charge referred in paragraph (1)(e).

        (1AE)  For the purposes of paragraph (1)(e), if:

                     (a)  the company has a superannuation guarantee shortfall for a quarter; and

                     (b)  the shortfall relates to one or more employees; and

                     (c)  the quarter begins after the relevant date; and

                     (d)  one or more payments were made by the company during the quarter on account of wages payable to those employees in respect of services rendered to the company by those employees before the relevant date; and

                     (e)  those payments were made as a result of an advance of money by a person after the relevant date for the purpose of making those payments;

then:

                      (f)  for the purposes of paragraph (1)(e), so much of the superannuation guarantee charge in respect of the quarter as is attributable to those payments is taken to be payable by the company in respect of services rendered to the company by those employees before the relevant date; and

                     (g)  the remainder of the superannuation guarantee charge in respect of the quarter is taken:

                              (i)  to be an expense referred to in paragraph (1)(a); and

                             (ii)  not to be an amount of superannuation guarantee charge referred in paragraph (1)(e).

        (1AF)  If:

                     (a)  the company has a superannuation guarantee shortfall for a quarter; and

                     (b)  the shortfall relates to one or more employees; and

                     (c)  the relevant date occurs during the quarter; and

                     (d)  one or more payments were made by the company during the quarter on account of wages payable to those employees in respect of services rendered to the company by those employees before the relevant date; and

                     (e)  those payments were made as a result of an advance of money by a person after the relevant date for the purpose of making those payments;

then:

                      (f)  for the purposes of paragraph (1)(e), so much of the superannuation guarantee charge in respect of the quarter as is attributable to either or both of the following:

                              (i)  those payments;

                             (ii)  the period before the relevant date;

                            is taken to be payable by the company in respect of services rendered to the company by those employees before the relevant date; and

                     (g)  the remainder of the superannuation guarantee charge in respect of the quarter is taken:

                              (i)  to be an expense referred to in paragraph (1)(a); and

                             (ii)  not to be an amount of superannuation guarantee charge referred in paragraph (1)(e); and

                     (h)  subsections (1AC) and (1AD) do not apply to the superannuation guarantee charge in respect of the quarter.

8  Subsection 556(2)

Insert:

quarter has the same meaning as in the Superannuation Guarantee (Administration) Act 1992 .

9  Section 560

Repeal the section, substitute:

560   Advances for company to make priority payments in relation to employees

                   If:

                     (a)  a payment has been made by a company:

                              (i)  on account of wages; or

                             (ii)  on account of superannuation contributions (within the meaning of section 556); or

                            (iii)  in respect of leave of absence, or termination of employment, under an industrial instrument; and

                     (b)  the payment was made as a result of an advance of money by a person (whether before, on or after the relevant date) for the purpose of making the payment;

then:

                     (c)  the person by whom the money was advanced has the same rights under this Chapter as a creditor of the company; and

                     (d)  subject to paragraph (e), the person by whom the money was advanced has, in the winding up of the company, the same right of priority of payment in respect of the money so advanced and paid as the person who received the payment would have had if the payment had not been made; and

                     (e)  the right of priority conferred by paragraph (d) is not to exceed the amount by which the sum in respect of which the person who received the payment would have been entitled to priority in the winding up has been diminished by reason of the payment.

10  Paragraph 1364(2)(f)

After “meetings of creditors,”, insert “meetings of eligible employee creditors,”.

Superannuation Guarantee (Administration) Act 1992

11  Section 52

Repeal the section.

12  Subsection 64B(3)

Omit “An”, substitute “Subject to subsection (3A), an”.

13  After subsection 64B(3)

Insert:

          (3A)  The Commissioner may vary an employee’s proportion of an amount if the amount of the charge payment has been affected by:

                     (a)  the application of the monetary limit imposed by subsection 556(1A) of the Corporations Act 2001 in respect of the employee; or

                     (b)  the application of the monetary limit imposed by paragraph 109(1)(e) of the Bankruptcy Act 1966 in respect of the employee.

14  Application—section 52 of the Superannuation Guarantee (Administration) Act 1992

The repeal of section 52 of the Superannuation Guarantee (Administration) Act 1992 by this Schedule, in so far as it relates to a company that is being wound up under the Corporations Act 2001 , applies if the relevant date (within the meaning of the Corporations Act 2001 ) is on or after the day on which this item commences.

15  Application—subsection 64B(3A) of the Superannuation Guarantee (Administration) Act 1992

(1)       Paragraph 64B(3A)(a) of the Superannuation Guarantee (Administration) Act 1992 applies if the relevant date (within the meaning of the Corporations Act 2001 ) is on or after the day on which this item commences.

(2)       Paragraph 64B(3A)(b) of the Superannuation Guarantee (Administration) Act 1992 , in so far as it relates to a bankruptcy, applies if the date of the bankruptcy is on or after the day on which this item commences.

(3)       Paragraph 64B(3A)(b) of the Superannuation Guarantee (Administration) Act 1992 , in so far as it relates to a personal insolvency agreement, applies if the relevant authority under section 188 of the Bankruptcy Act 1966 became effective on or after the day on which this item commences.



 

Part 2 Better informing creditor decisions

Corporations Act 2001

16  Section 9

Insert:

declaration of indemnities , in relation to an administrator of a company under administration, means a written declaration:

                     (a)  stating whether the administrator has, to any extent, been indemnified (otherwise than under section 443D), in relation to that administration, for:

                              (i)  any debts for which the administrator is, or may become, liable under Subdivision A of Division 9 of Part 5.3A; or

                             (ii)  any debts for which the administrator is, or may become, liable under a remittance provision as defined in section 443BA; or

                            (iii)  his or her remuneration as determined under section 449E; and

                     (b)  if so, stating:

                              (i)  the identity of each indemnifier; and

                             (ii)  the extent and nature of each indemnity.

17  Section 9

Insert:

declaration of relevant relationships has the meaning given by section 60.

18  Section 9

Insert:

firm , in relation to an administrator or liquidator, means:

                     (a)  if the administrator or liquidator is a partner or employee of a partnership (the partnership firm ) that provides advice or other services in relation to externally-administered bodies corporate—the partnership firm; or

                     (b)  if the administrator or liquidator is an officer or employee of a body corporate (the body corporate firm ) that provides advice or other services in relation to externally-administered bodies corporate—the body corporate firm.

19  After section 59

Insert:

60   Declaration of relevant relationships

Administrator

             (1)  In this Act, a declaration of relevant relationships , in relation to an administrator of a company under administration, means a written declaration:

                     (a)  stating whether any of the following:

                              (i)  the administrator;

                             (ii)  if the administrator’s firm (if any) is a partnership—a partner in that partnership;

                            (iii)  if the administrator’s firm (if any) is a body corporate—that body corporate or an associate of that body corporate;

                            has, or has had within the preceding 24 months, a relationship with:

                            (iv)  the company; or

                             (v)  an associate of the company; or

                            (vi)  a former liquidator, or former provisional liquidator, of the company; or

                           (vii)  a person who is entitled to enforce a charge on the whole, or substantially the whole, of the company’s property; and

                     (b)  if so, stating the administrator’s reasons for believing that none of the relevant relationships result in the administrator having a conflict of interest or duty.

Liquidator

             (2)  In this Act, a declaration of relevant relationships , in relation to a liquidator of a company, means a written declaration:

                     (a)  stating whether any of the following:

                              (i)  the liquidator;

                             (ii)  if the liquidator’s firm (if any) is a partnership—a partner in that partnership;

                            (iii)  if the liquidator’s firm (if any) is a body corporate—that body corporate or an associate of that body corporate;

                            has, or has had within the preceding 24 months, a relationship with:

                            (iv)  the company; or

                             (v)  an associate of the company; or

                            (vi)  a former liquidator, or former provisional liquidator, of the company; or

                           (vii)  a former administrator of the company; or

                          (viii)  a former administrator of a deed of company arrangement executed by the company; and

                     (b)  if so, stating the liquidator’s reasons for believing that none of the relevant relationships result in the liquidator having a conflict of interest or duty.

20  At the end of section 425

Add:

             (8)  In exercising its powers under this section, the Court must have regard to whether the remuneration is reasonable, taking into account any or all of the following matters:

                     (a)  the extent to which the work performed by the receiver was reasonably necessary;

                     (b)  the extent to which the work likely to be performed by the receiver is likely to be reasonably necessary;

                     (c)  the period during which the work was, or is likely to be, performed by the receiver;

                     (d)  the quality of the work performed, or likely to be performed, by the receiver;

                     (e)  the complexity (or otherwise) of the work performed, or likely to be performed, by the receiver;

                      (f)  the extent (if any) to which the receiver was, or is likely to be, required to deal with extraordinary issues;

                     (g)  the extent (if any) to which the receiver was, or is likely to be, required to accept a higher level of risk or responsibility than is usually the case;

                     (h)  the value and nature of any property dealt with, or likely to be dealt with, by the receiver;

                      (i)  whether the receiver was, or is likely to be, required to deal with:

                              (i)  one or more other receivers; or

                             (ii)  one or more receivers and managers; or

                            (iii)  one or more liquidators; or

                            (iv)  one or more administrators; or

                             (v)  one or more administrators of deeds of company arrangement;

                      (j)  the number, attributes and behaviour, or the likely number, attributes and behaviour, of the company’s creditors;

                     (k)  if the remuneration is ascertained, in whole or in part, on a time basis:

                              (i)  the time properly taken, or likely to be properly taken, by the receiver in performing the work; and

                             (ii)  whether the total remuneration payable to the receiver is capped;

                      (l)  any other relevant matters.

21  After section 436D

Insert:

436DA   Declarations by administrator—indemnities and relevant relationships

Scope

             (1)  This section applies to an administrator appointed under section 436A, 436B or 436C.

Declaration of relationships and indemnities

             (2)  As soon as practicable after being appointed, the administrator must make:

                     (a)  a declaration of relevant relationships; and

                     (b)  a declaration of indemnities.

Note:          Failure to comply with this subsection is an offence (see subsection 1311(1)).

Notification of creditors

             (3)  The administrator must:

                     (a)  give a copy of each declaration under subsection (2) to as many of the company’s creditors as reasonably practicable; and

                     (b)  do so at the same time as the administrator gives those creditors notice of the meeting referred to in section 436E.

Note:          Failure to comply with this subsection is an offence (see subsection 1311(1)).

             (4)  The administrator must table a copy of each declaration under subsection (2) at the meeting referred to in section 436E.

Note:          Failure to comply with this subsection is an offence (see subsection 1311(1)).

Updating of declaration

             (5)  If:

                     (a)  at a particular time, the administrator makes:

                              (i)  a declaration of relevant relationships; or

                             (ii)  a declaration of indemnities;

                            under subsection (2) or this subsection; and

                     (b)  at a later time:

                              (i)  the declaration has become out-of-date; or

                             (ii)  the administrator becomes aware of an error in the declaration;

the administrator must, as soon as practicable, make:

                     (c)  if subparagraph (a)(i) applies—a replacement declaration of relevant relationships; or

                     (d)  if subparagraph (a)(ii) applies—a replacement declaration of indemnities.

Note:          Failure to comply with this subsection is an offence (see subsection 1311(1)).

             (6)  The administrator must table a copy of a replacement declaration under subsection (5):

                     (a)  if:

                              (i)  there is a committee of creditors; and

                             (ii)  the next meeting of the committee of creditors occurs before the next meeting of the company’s creditors;

                            at the next meeting of the committee of creditors; or

                     (b)  in any other case—at the next meeting of the company’s creditors.

Note:          Failure to comply with this subsection is an offence (see subsection 1311(1)).

Defence

             (7)  In a prosecution for an offence constituted by a failure to include a particular matter in a declaration under this section, it is a defence if the defendant proves that:

                     (a)  the defendant made reasonable enquiries; and

                     (b)  after making these enquiries, the defendant had no reasonable grounds for believing that the matter should have been included in the declaration.

22  Subsection 446A(4)

Repeal the subsection.

23  At the end of section 446A

Add:

Note:          See also section 499 (appointment of liquidator).

24  After section 449C

Insert:

449CA   Declarations by administrator—indemnities and relevant relationships

Scope

             (1)  This section applies to an administrator appointed under subsection 449C(1) otherwise than by the Court.

Declaration of relationships and indemnities

             (2)  As soon as practicable after being appointed, the administrator must make:

                     (a)  a declaration of relevant relationships; and

                     (b)  a declaration of indemnities.

Note:          Failure to comply with this subsection is an offence (see subsection 1311(1)).

Notification of creditors

             (3)  The administrator must:

                     (a)  give a copy of each declaration under subsection (2) to as many of the company’s creditors as reasonably practicable; and

                     (b)  do so at the same time as the administrator gives those creditors notice of the meeting convened under subsection 449C(4).

Note:          Failure to comply with this subsection is an offence (see subsection 1311(1)).

             (4)  The administrator must table a copy of each declaration under subsection (2) at the meeting convened under subsection 449C(4).

Note:          Failure to comply with this subsection is an offence (see subsection 1311(1)).

Updating of declaration

             (5)  If:

                     (a)  at a particular time, the administrator makes:

                              (i)  a declaration of relevant relationships; or

                             (ii)  a declaration of indemnities;

                            under subsection (2) or this subsection; and

                     (b)  at a later time:

                              (i)  the declaration has become out-of-date; or

                             (ii)  the administrator becomes aware of an error in the declaration;

the administrator must, as soon as practicable, make:

                     (c)  if subparagraph (a)(i) applies—a replacement declaration of relevant relationships; or

                     (d)  if subparagraph (a)(ii) applies—a replacement declaration of indemnities.

Note:          Failure to comply with this subsection is an offence (see subsection 1311(1)).

             (6)  The administrator must table a copy of a replacement declaration under subsection (5):

                     (a)  if:

                              (i)  there is a committee of creditors; and

                             (ii)  the next meeting of the committee of creditors occurs before the next meeting of the company’s creditors;

                            at the next meeting of the committee of creditors; or

                     (b)  in any other case—at the next meeting of the company’s creditors.

Note:          Failure to comply with this subsection is an offence (see subsection 1311(1)).

Defence

             (7)  In a prosecution for an offence constituted by a failure to include a particular matter in a declaration under this section, it is a defence if the defendant proves that:

                     (a)  the defendant made reasonable enquiries; and

                     (b)  after making these enquiries, the defendant had no reasonable grounds for believing that the matter should have been included in the declaration.

25  Subsection 449E(1)

Repeal the subsection, substitute:

             (1)  The administrator of a company under administration is entitled to receive such remuneration as is determined:

                     (a)  by agreement between the administrator and the committee of creditors (if any); or

                     (b)  by resolution of the company’s creditors; or

                     (c)  if there is no such agreement or resolution—by the Court.

          (1A)  The administrator of a company under a deed of company arrangement is entitled to receive such remuneration as is determined:

                     (a)  by agreement between the administrator and the committee of inspection (if any); or

                     (b)  by resolution of the company’s creditors; or

                     (c)  if there is no such agreement or resolution—by the Court.

          (1B)  To be effective, a resolution under paragraph (1)(b) or (1A)(b) must deal exclusively with remuneration of the administrator.

Note:          This means that the resolution must not be bundled with any other resolution.

          (1C)  The Court may determine remuneration under paragraph (1)(c) even if:

                     (a)  there has been no meeting of the committee of creditors; or

                     (b)  there has been no meeting of the company’s creditors.

          (1D)  The Court may determine remuneration under paragraph (1A)(c) even if:

                     (a)  there has been no meeting of the committee of inspection; or

                     (b)  there has been no meeting of the company’s creditors.

26  Subsection 449E(2)

Omit “fixed under paragraph (1)(a)”, substitute “determined under paragraph (1)(a) or (b) or paragraph (1A)(a) or (b)”.

27  Subsection 449E(2)

After “on the application”, insert “of ASIC,”.

28  At the end of section 449E

Add:

             (4)  In exercising its powers under subsection (1), (1A) or (2), the Court must have regard to whether the remuneration is reasonable, taking into account any or all of the following matters:

                     (a)  the extent to which the work performed by the administrator was reasonably necessary;

                     (b)  the extent to which the work likely to be performed by the administrator is likely to be reasonably necessary;

                     (c)  the period during which the work was, or is likely to be, performed by the administrator;

                     (d)  the quality of the work performed, or likely to be performed, by the administrator;

                     (e)  the complexity (or otherwise) of the work performed, or likely to be performed, by the administrator;

                      (f)  the extent (if any) to which the administrator was, or is likely to be, required to deal with extraordinary issues;

                     (g)  the extent (if any) to which the administrator was, or is likely to be, required to accept a higher level of risk or responsibility than is usually the case;

                     (h)  the value and nature of any property dealt with, or likely to be dealt with, by the administrator;

                      (i)  whether the administrator was, or is likely to be, required to deal with:

                              (i)  one or more receivers; or

                             (ii)  one or more receivers and managers;

                      (j)  the number, attributes and behaviour, or the likely number, attributes and behaviour, of the company’s creditors;

                     (k)  if the remuneration is ascertained, in whole or in part, on a time basis:

                              (i)  the time properly taken, or likely to be properly taken, by the administrator in performing the work; and

                             (ii)  whether the total remuneration payable to the administrator is capped;

                      (l)  any other relevant matters.

             (5)  Before remuneration is determined under paragraph (1)(a), the administrator must:

                     (a)  prepare a report setting out:

                              (i)  such matters as will enable the committee of creditors to make an informed assessment as to whether the proposed remuneration is reasonable; and

                             (ii)  a summary description of the major tasks performed, or likely to be performed, by the administrator; and

                            (iii)  the costs associated with each of those major tasks; and

                     (b)  give a copy of the report to each member of the committee of creditors at the same time as the member is notified of the relevant meeting of the committee.

             (6)  Before remuneration is determined under paragraph (1A)(a), the administrator must:

                     (a)  prepare a report setting out:

                              (i)  such matters as will enable the committee of inspection to make an informed assessment as to whether the proposed remuneration is reasonable; and

                             (ii)  a summary description of the major tasks performed, or likely to be performed, by the administrator; and

                            (iii)  the costs associated with each of those major tasks; and

                     (b)  give a copy of the report to each member of the committee of inspection at the same time as the member is notified of the relevant meeting of the committee.

             (7)  Before remuneration is determined under paragraph (1)(b) or (1A)(b), the administrator must:

                     (a)  prepare a report setting out:

                              (i)  such matters as will enable the company’s creditors to make an informed assessment as to whether the proposed remuneration is reasonable; and

                             (ii)  a summary description of the major tasks performed, or likely to be performed, by the administrator; and

                            (iii)  the costs associated with each of those major tasks; and

                     (b)  give a copy of the report to each of the company’s creditors at the same time as the creditor is notified of the relevant meeting of creditors.

29  After subsection 473(4)

Insert:

          (4A)  If:

                     (a)  no remuneration has been fixed under paragraph (3)(a) or (b); and

                     (b)  a meeting of the company’s creditors is convened; and

                     (c)  a resolution under subparagraph (3)(b)(i) cannot be passed because of the lack of a quorum; and

                     (d)  there has been no previous application of this subsection to the remuneration of the liquidator;

the creditors are taken to have passed a resolution under subparagraph (3)(b)(i) determining that the liquidator is entitled to remuneration of:

                     (e)  whichever is the greater of the following amounts:

                              (i)  $5,000;

                             (ii)  if an amount is specified in regulations for the purposes of this subparagraph—that amount; or

                      (f)  if the liquidator determines a lesser amount—that lesser amount.

          (4B)  Subsection (4A) does not limit the Court’s powers under subsection (6).

30  At the end of section 473

Add:

           (10)  In exercising its powers under subsection (3), (5) or (6), the Court must have regard to whether the remuneration is reasonable, taking into account any or all of the following matters:

                     (a)  the extent to which the work performed by the liquidator was reasonably necessary;

                     (b)  the extent to which the work likely to be performed by the liquidator is likely to be reasonably necessary;

                     (c)  the period during which the work was, or is likely to be, performed by the liquidator;

                     (d)  the quality of the work performed, or likely to be performed, by the liquidator;

                     (e)  the complexity (or otherwise) of the work performed, or likely to be performed, by the liquidator;

                      (f)  the extent (if any) to which the liquidator was, or is likely to be, required to deal with extraordinary issues;

                     (g)  the extent (if any) to which the liquidator was, or is likely to be, required to accept a higher level of risk or responsibility than is usually the case;

                     (h)  the value and nature of any property dealt with, or likely to be dealt with, by the liquidator;

                      (i)  whether the liquidator was, or is likely to be, required to deal with:

                              (i)  one or more receivers; or

                             (ii)  one or more receivers and managers;

                      (j)  the number, attributes and behaviour, or the likely number, attributes and behaviour, of the company’s creditors;

                     (k)  if the remuneration is ascertained, in whole or in part, on a time basis:

                              (i)  the time properly taken, or likely to be properly taken, by the liquidator in performing the work; and

                             (ii)  whether the total remuneration payable to the liquidator is capped;

                      (l)  any other relevant matters.

           (11)  Before remuneration is determined under paragraph (3)(a), the liquidator must:

                     (a)  prepare a report setting out:

                              (i)  such matters as will enable the committee of inspection to make an informed assessment as to whether the proposed remuneration is reasonable; and

                             (ii)  a summary description of the major tasks performed, or likely to be performed, by the liquidator; and

                            (iii)  the costs associated with each of those major tasks; and

                     (b)  give a copy of the report to each member of the committee of inspection at the same time as the member is notified of the relevant meeting of the committee.

           (12)  Before remuneration is determined under subparagraph (3)(b)(i), the liquidator must:

                     (a)  prepare a report setting out:

                              (i)  such matters as will enable the company’s creditors to make an informed assessment as to whether the proposed remuneration is reasonable; and

                             (ii)  a summary description of the major tasks performed, or likely to be performed, by the liquidator; and

                            (iii)  the costs associated with each of those major tasks; and

                     (b)  give a copy of the report to each of the company’s creditors at the same time as the creditor is notified of the relevant meeting of creditors.

31  At the end of section 495

Add:

             (5)  Before remuneration is fixed under subsection (1), the liquidator or liquidators, or the proposed liquidator or proposed liquidators, must:

                     (a)  prepare a report setting out:

                              (i)  such matters as will enable the members to make an informed assessment as to whether the proposed remuneration is reasonable; and

                             (ii)  a summary description of the major tasks likely to be performed by the liquidator or liquidators, or the proposed liquidator or proposed liquidators, as the case may be; and

                            (iii)  the costs associated with each of those major tasks; and

                     (b)  table the report at the relevant general meeting.

32  Subsection 499(3)

Repeal the subsection, substitute:

             (3)  The remuneration to be paid to the liquidator may be fixed:

                     (a)  if there is a committee of inspection—by that committee; or

                     (b)  by resolution of the creditors.

          (3A)  If:

                     (a)  no remuneration has been fixed under subsection (3); and

                     (b)  a meeting of the company’s creditors is convened; and

                     (c)  a resolution under paragraph (3)(b) cannot be passed because of the lack of a quorum; and

                     (d)  there has been no previous application of this subsection to the remuneration of the liquidator;

the creditors are taken to have passed a resolution under paragraph (3)(b) determining that the liquidator is entitled to remuneration of:

                     (e)  whichever is the greater of the following amounts:

                              (i)  $5,000;

                             (ii)  if an amount is specified in regulations for the purposes of this subparagraph—that amount; or

                      (f)  if the liquidator determines a lesser amount—that lesser amount.

33  At the end of section 499

Add:

             (6)  Before remuneration is fixed under subsection (3) by the committee of inspection, the liquidator must:

                     (a)  prepare a report setting out:

                              (i)  such matters as will enable the members of the committee to make an informed assessment as to whether the proposed remuneration is reasonable; and

                             (ii)  a summary description of the major tasks performed, or likely to be performed, by the liquidator; and

                            (iii)  the costs associated with each of those major tasks; and

                     (b)  give a copy of the report to each member of the committee at the same time as the member is notified of the relevant meeting of the committee.

             (7)  Before remuneration is fixed under subsection (3) by resolution of the creditors, the liquidator must:

                     (a)  prepare a report setting out:

                              (i)  such matters as will enable the creditors to make an informed assessment as to whether the proposed remuneration is reasonable; and

                             (ii)  a summary description of the major tasks performed, or likely to be performed, by the liquidator; and

                            (iii)  the costs associated with each of those major tasks; and

                     (b)  give a copy of the report to each of the creditors at the same time as the creditor is notified of the relevant meeting of creditors.

34  Section 504

Before “Any member”, insert “(1)”.

35  At the end of section 504

Add:

             (2)  In exercising its powers under subsection (1), the Court must have regard to whether the remuneration is reasonable, taking into account any or all of the following matters:

                     (a)  the extent to which the work performed by the liquidator was reasonably necessary;

                     (b)  the extent to which the work likely to be performed by the liquidator is likely to be reasonably necessary;

                     (c)  the period during which the work was, or is likely to be, performed by the liquidator;

                     (d)  the quality of the work performed, or likely to be performed, by the liquidator;

                     (e)  the complexity (or otherwise) of the work performed, or likely to be performed, by the liquidator;

                      (f)  the extent (if any) to which the liquidator was, or is likely to be, required to deal with extraordinary issues;

                     (g)  the extent (if any) to which the liquidator was, or is likely to be, required to accept a higher level of risk or responsibility than is usually the case;

                     (h)  the value and nature of any property dealt with, or likely to be dealt with, by the liquidator;

                      (i)  whether the liquidator was, or is likely to be, required to deal with:

                              (i)  one or more receivers; or

                             (ii)  one or more receivers and managers;

                      (j)  the number, attributes and behaviour, or the likely number, attributes and behaviour, of the company’s creditors;

                     (k)  if the remuneration is ascertained, in whole or in part, on a time basis:

                              (i)  the time properly taken, or likely to be properly taken, by the liquidator in performing the work; and

                             (ii)  whether the total remuneration payable to the liquidator is capped;

                      (l)  any other relevant matters.

36  After section 506

Insert:

506A   Declarations by liquidator—relevant relationships

Scope

             (1)  This section applies if the liquidator of a company is required to convene a meeting under section 497.

Declaration of relevant relationships

             (2)  Before convening the meeting, the liquidator must make a declaration of relevant relationships.

Note:          Failure to comply with this subsection is an offence (see subsection 1311(1)).

Notification of creditors

             (3)  The liquidator must:

                     (a)  give a copy of each declaration under subsection (2) to as many of the company’s creditors as reasonably practicable; and

                     (b)  do so at the same time as the liquidator gives those creditors notice of the meeting.

Note:          Failure to comply with this subsection is an offence (see subsection 1311(1)).

             (4)  The liquidator must table a copy of each declaration under subsection (2) at the meeting.

Note:          Failure to comply with this subsection is an offence (see subsection 1311(1)).

Updating of declaration

             (5)  If:

                     (a)  at a particular time, the liquidator makes a declaration of relevant relationships under subsection (2) or this subsection; and

                     (b)  at a later time:

                              (i)  the declaration has become out-of-date; or

                             (ii)  the liquidator becomes aware of an error in the declaration;

the liquidator must, as soon as practicable, make a replacement declaration of relevant relationships.

Note:          Failure to comply with this subsection is an offence (see subsection 1311(1)).

             (6)  The liquidator must table a copy of a replacement declaration under subsection (4):

                     (a)  if:

                              (i)  there is a committee of inspection; and

                             (ii)  the next meeting of the committee of inspection occurs before the next meeting of the company’s creditors;

                            at the next meeting of the committee of inspection; or

                     (b)  in any other case—at the next meeting of the company’s creditors.

Note:          Failure to comply with this subsection is an offence (see subsection 1311(1)).

Defence

             (7)  In a prosecution for an offence constituted by a failure to include a particular matter in a declaration under this section, it is a defence if the defendant proves that:

                     (a)  the defendant made reasonable enquiries; and

                     (b)  after making these enquiries, the defendant had no reasonable grounds for believing that the matter should have been included in the declaration.

37  Paragraph 508(1)(b)

Repeal the paragraph, substitute:

                     (b)  in the case of a creditors’ voluntary winding up:

                              (i)  convene a meeting of the creditors; or

                             (ii)  prepare a report that complies with subsection (3), and lodge a copy of the report with ASIC;

Note:       The heading to section 508 is altered by omitting “ meeting of creditors ” and substituting “ obligations of liquidator—meeting or report ”.

38  Subsection 508(1)

Omit “from the commencement of the winding up”, substitute “beginning on the day on which the company resolved that it be wound up voluntarily”.

39  Subsection 508(1)

Omit all the words after “each succeeding year”.

40  Subsection 508(2)

Repeal the subsection, substitute:

             (2)  The liquidator must lay before a meeting convened under paragraph (1)(a) or subparagraph (1)(b)(i) an account of:

                     (a)  the liquidator’s acts and dealings; and

                     (b)  the conduct of the winding up;

during that first year or that succeeding year, as the case may be.

             (3)  A report referred to in subparagraph (1)(b)(ii) must set out:

                     (a)  an account of:

                              (i)  the liquidator’s acts and dealings; and

                             (ii)  the conduct of the winding up;

                            during that first year or that succeeding year, as the case may be; and

                     (b)  a description of the acts and dealings that remain to be carried out by the liquidator in order to complete the winding up; and

                     (c)  an estimate of when the winding up is likely to be completed.

             (4)  If a liquidator prepares a report under subparagraph (1)(b)(ii), the liquidator must, within 14 days of lodging a copy of the report with ASIC, give each creditor of the company a written notice stating that:

                     (a)  the liquidator has decided not to convene a meeting of the creditors under subparagraph (1)(b)(i); and

                     (b)  the liquidator has:

                              (i)  prepared a report under subparagraph (1)(b)(ii); and

                             (ii)  lodged a copy of the report with ASIC; and

                     (c)  if the creditor requests the liquidator to give the creditor a copy of the report free of charge, the liquidator will comply with the request.

Note:          For electronic notification under this subsection, see section 600G.

             (5)  If a request is made as mentioned in paragraph (4)(c), the liquidator must comply with the request as soon as practicable.



 

Part 3 Streamlining external administration

Corporations Act 2001

41  Section 9 (paragraph (b) of the definition of controller )

Omit “charge.”, substitute “charge;”.

42  Section 9 (at the end of the definition of controller )

Add:

and has a meaning affected by paragraph 434F(b) (which deals with 2 or more persons appointed as controllers).

43  Section 9 (definition of liquidator )

Repeal the definition, substitute:

liquidator :

                     (a)  has a meaning affected by paragraph 530(b) (which deals with 2 or more persons appointed as liquidators); and

                     (b)  in Chapter 7, includes a provisional liquidator.

44  Section 9 (paragraph (b) of the definition of managing controller )

Omit “corporation.”, substitute “corporation;”.

45  Section 9 (at the end of the definition of managing controller )

Add:

and has a meaning affected by paragraph 434G(b) (which deals with 2 or more persons appointed as managing controllers).

46  Section 9

Insert:

provisional liquidator has a meaning affected by paragraph 530AA(b) (which deals with 2 or more persons appointed as provisional liquidators).

47  Section 9

Insert:

receiver has a meaning affected by paragraph 434D(b) (which deals with 2 or more persons appointed as receivers).

48  Section 9 (at the end of the definition of receiver and manager )

Add “and has a meaning affected by paragraph 434E(b) (which deals with 2 or more persons appointed as receivers and managers)”.

49  After section 157

Insert:

157A   Change of name of company under external administration

Application by liquidator

             (1)  The liquidator of a company that is being wound up may lodge an application with ASIC to change the name of the company if the liquidator is satisfied that the proposed change of name is in the interests of the creditors of the company as a whole.

             (2)  Subsection (1) does not apply to a members’ voluntary winding up.

Application by administrator

             (3)  The administrator of a company under administration may lodge an application with ASIC to change the name of the company if the administrator is satisfied that the proposed change of name is in the interests of the creditors of the company as a whole.

Application by deed administrator

             (4)  The administrator of a deed of company arrangement may lodge an application with ASIC to change the name of the company if the administrator is satisfied that the proposed change of name is in the interests of the creditors of the company as a whole.

Application by managing controller

             (5)  If:

                     (a)  a person is the managing controller of property of a company; and

                     (b)  the person is entitled to enforce a charge on the whole, or substantially the whole, of the company’s property;

the person may lodge an application with ASIC to change the name of the company if the person is satisfied that the proposed change of name is in the interests of the creditors of the company as a whole.

Application by receiver

             (6)  If:

                     (a)  a person is a receiver of property of a company; and

                     (b)  the property subject to the receivership consists of, or includes, goodwill in relation to the name of the company;

the person may lodge an application with ASIC to change the name of the company if the person is satisfied that the proposed change of name is in the interests of the creditors of the company as a whole.

Change of name

             (7)  If:

                     (a)  an application is lodged under subsection (1), (3), (4), (5) or (6); and

                     (b)  the proposed name is available;

ASIC must change the company’s name by altering the details of the company’s registration to reflect the change. The change of name takes effect when ASIC alters the details of the company’s registration.

Note:          For available names, see section 147.

50  At the end of Division 2 of Part 2B.6

Add:

161A   Company under external administration—former name to be used on documents

             (1)  This section applies to a company if:

                     (a)  any of the following conditions is satisfied:

                              (i)  the company is being wound up;

                             (ii)  the company is under administration;

                            (iii)  the company has executed a deed of company arrangement that has not yet terminated;

                            (iv)  there is a managing controller of property of the company;

                             (v)  there is a receiver of property of the company; and

                     (b)  any of the following conditions is satisfied:

                              (i)  a change of the company’s name takes effect;

                             (ii)  in the case of a company that is being wound up—a change of the company’s name took effect during the 6-month period ending immediately before the relevant date;

                            (iii)  in the case of a company under administration—a change of the company’s name took effect during the 6-month period ending immediately before the administration began;

                            (iv)  in the case of a company that has executed a deed of company arrangement—a change of the company’s name took effect during the 6-month period ending immediately before the beginning of the administration that ended when the deed was executed;

                             (v)  in the case of a company where there is a managing controller—a change in the company’s name took effect during the 6-month period ending immediately before the appointment of the managing controller;

                            (vi)  in the case of a company where there is a receiver—a change in the company’s name took effect during the 6-month period ending immediately before the appointment of the receiver.

             (2)  If subparagraph (1)(b)(i), (ii), (iv), (v) or (vi) applies, the company must set out its former name on all its public documents and negotiable instruments.

             (3)  If subparagraph (1)(b)(iii) applies, then, except with the leave of the Court, the company must set out its former name on all its public documents and negotiable instruments.

             (4)  An offence based on subsection (2) or (3) is an offence of strict liability.

Note:          For strict liability , see section 6.1 of the Criminal Code .

             (5)  The regulations may exempt a specified company, or a class of companies, from the requirement in subsection (2) or (3). The exemption may relate to specified documents or instruments, or a specified class of documents or instruments.

             (6)  The Court may only grant leave under subsection (3) on the application of the administrator of the deed of company arrangement.

             (7)  The Court may only grant leave under subsection (3) if it is satisfied that the granting of leave will not result in any significant risk to the interests of the company’s creditors (including contingent or prospective creditors) as a whole.

51  After section 250P

Insert:

250PAA   Exemptions by ASIC—class orders relating to externally-administered companies

             (1)  ASIC may, by legislative instrument, make an order exempting any of the following from section 250N:

                     (a)  a specified class of companies that are being wound up;

                     (b)  a specified class of companies under administration;

                     (c)  a specified class of companies subject to deeds of company arrangement.

             (2)  The order may be:

                     (a)  unconditional; or

                     (b)  subject to one or more specified conditions.

             (3)  ASIC must cause a copy of the order to be published in the Gazette .

250PAB   Exemptions by ASIC—individual externally-administered companies

             (1)  The liquidator of a company that is being wound up may lodge an application with ASIC to exempt the company from section 250N.

             (2)  The administrator of a company under administration may lodge an application with ASIC to exempt the company from section 250N.

             (3)  The administrator of a deed of company arrangement may lodge an application with ASIC to exempt the company from section 250N.

             (4)  If an application is lodged under subsection (1), (2) or (3), ASIC may, by writing, exempt the company from section 250N.

             (5)  The exemption may be:

                     (a)  unconditional; or

                     (b)  subject to one or more specified conditions.

             (6)  ASIC must cause a copy of the exemption to be published in the Gazette .

52  Sub-subparagraph 411(4)(a)(ii)(A)

Before “passed”, insert “unless the Court orders otherwise—”.

53  Subsection 421(1)

Before “controller” (first occurring), insert “managing”.

Note:       The heading to section 421 is altered by omitting “ Controller’s ” and substituting “ Managing controller’s ”.

54  Subparagraph 421(1)(a)(i)

Before “controller’s”, insert “managing”.

55  Subparagraph 421(1)(a)(iii)

Before “controller”, insert “managing”.

56  Paragraphs 421(1)(b), (c) and (d)

Before “controller”(wherever occurring), insert “managing”.

57  Subsection 421(2)

Before “controller”, insert “managing”.

58  Subsection 421A(3)

Repeal the subsection.

59  Subsection 422(1)

After “receiver” (first occurring), insert “or managing controller”.

Note:       The heading to section 422 is altered by adding at the end “ or managing controller ”.

60  Subsection 422(1)

After “receiver” (last occurring), insert “or managing controller”.

61  Subsection 422(2)

After “receiver”, insert “or managing controller”.

62  Subsection 422(2)

Omit “receiver’s opinion”, substitute “opinion of the receiver or managing controller”.

63  Paragraph 422(3)(a)

Omit “under a law referred to in paragraph (1)(a)”.

64  At the end of section 422

Add:

             (4)  If:

                     (a)  there is a managing controller in relation to property of a corporation; and

                     (b)  it appears to the Court that:

                              (i)  a past or present officer or employee, or a member, of the corporation has been guilty of an offence in relation to the corporation; or

                             (ii)  a person who has taken part in the formation, promotion, administration, management or winding up of the corporation has engaged in conduct referred to in paragraph (1)(b) in relation to the corporation; and

                     (c)  it appears to the Court that the managing controller has not lodged a report about the matter;

the Court may, on the application of a person interested in the appointment of the managing controller, direct the managing controller to lodge such a report.

65  Subsections 427(1), (1A) and (1B)

Repeal the subsections, substitute:

             (1)  A person who:

                     (a)  obtains an order for the appointment of a receiver of property of a corporation; or

                     (b)  appoints such a receiver under a power contained in an instrument;

must, within 7 days after obtaining the order or making the appointment, lodge notice that the order has been obtained, or that the appointment has been made, as the case may be.

          (1A)  A person who appoints another person to enter into possession, or take control, of property of a corporation (whether or not as agent for the corporation) for the purpose of enforcing a charge otherwise than as receiver of that property must, within 7 days after making the appointment, lodge notice of the appointment.

          (1B)  A person who enters into possession, or takes control, as mentioned in subsection (1A) must, within 7 days after entering into possession or taking control, lodge notice that the person has done so, unless another person:

                     (a)  appointed the first-mentioned person so to enter into possession or take control; and

                     (b)  complies with subsection (1A) in relation to the appointment.

66  Subsection 427(4)

Repeal the subsection, substitute:

             (4)  A person who ceases to be a controller of property of a corporation must, within 7 days after so ceasing, lodge notice that the person has so ceased.

67  At the end of Part 5.2

Add:

434D   Appointment of 2 or more receivers of property of a corporation

                   If 2 or more persons have been appointed as receivers of property of a corporation:

                     (a)  a function or power of a receiver of property of the corporation may be performed or exercised by any one of them, or by any 2 or more of them together, except so far as the order or instrument appointing them otherwise provides; and

                     (b)  a reference in this Act to a receiver, or to the receiver, of property of a corporation is, in the case of the first-mentioned corporation, a reference to whichever one or more of those receivers the case requires.

434E   Appointment of 2 or more receivers and managers of property of a corporation

                   If 2 or more persons have been appointed as receivers and managers of property of a corporation:

                     (a)  a function or power of a receiver and manager of property of the corporation may be performed or exercised by any one of them, or by any 2 or more of them together, except so far as the order or instrument appointing them otherwise provides; and

                     (b)  a reference in this Act to a receiver and manager, or to the receiver and manager, of property of a corporation is, in the case of the first-mentioned corporation, a reference to whichever one or more of those receivers and managers the case requires.

434F   Appointment of 2 or more controllers of property of a corporation

                   If 2 or more persons have been appointed as controllers of property of a corporation:

                     (a)  a function or power of a controller of property of the corporation may be performed or exercised by any one of them, or by any 2 or more of them together, except so far as the order or instrument appointing them otherwise provides; and

                     (b)  a reference in this Act to a controller, or to the controller, of property of a corporation is, in the case of the first-mentioned corporation, a reference to whichever one or more of those controllers the case requires.

434G   Appointment of 2 or more managing controllers of property of a corporation

                   If 2 or more persons have been appointed as managing controllers of property of a corporation:

                     (a)  a function or power of a managing controller of property of the corporation may be performed or exercised by any one of them, or by any 2 or more of them together, except so far as the order or instrument appointing them otherwise provides; and

                     (b)  a reference in this Act to a managing controller, or to the managing controller, of property of a corporation is, in the case of the first-mentioned corporation, a reference to whichever one or more of those managing controllers the case requires.

68  At the end of subsection 436E(3)

Add:

Note:          For electronic notification under paragraph (a), see section 600G.

69  After subsection 436E(3)

Insert:

          (3A)  A notice under paragraph (3)(b) that relates to a company may be combined with a notice under paragraph 450A(1)(b) that relates to the company.

70  Section 436G

Before “A person”, insert “(1)”.

71  Section 436G

Omit “he or she”, substitute “the person”.

72  At the end of section 436G

Add:

             (2)  If a member of such a committee is a body corporate, the member may be represented at meetings of the committee by:

                     (a)  an officer or employee of the member; or

                     (b)  an individual authorised in writing by the member for the purposes of this subsection.

73  At the end of subsection 439A(3)

Add:

Note:          For electronic notification under paragraph (a), see section 600G.

74  At the end of subsection 439A(4)

Add:

Note:          For electronic notification, see section 600G.

75  Subsection 445F(2)

Repeal the subsection, substitute:

             (2)  The deed’s administrator must convene the meeting by giving written notice of the meeting:

                     (a)  to as many of the company’s creditors as reasonably practicable; and

                     (b)  at least 5 business days before the meeting.

Note:          For electronic notification, see section 600G.

76  Subsection 445F(3)

Omit “paragraph (2)(a)”, substitute “subsection (2)”.

77  At the end of subsection 449C(5)

Add:

Note:          For electronic notification under paragraph (a), see section 600G.

78  After subsection 450A(1)

Insert:

          (1A)  A notice under paragraph (1)(b) that relates to a company may be combined with a notice under paragraph 436E(3)(b) that relates to the company.

79  At the end of subsection 450A(3)

Add:

Note:          For electronic notification, see section 600G.

80  Paragraph 450B(b)

Repeal the paragraph.

81  At the end of section 450B

Add:

Note:          For electronic notification under paragraph (a), see section 600G.

82  Paragraph 450C(b)

Repeal the paragraph, substitute:

                     (b)  send such a notice to each of the company’s creditors.

83  At the end of section 450C

Add:

Note:          For electronic notification under paragraph (b), see section 600G.

84  Paragraph 450D(b)

Omit “creditors; and”, substitute “creditors.”.

85  Paragraph 450D(c)

Repeal the paragraph.

86  At the end of section 450D

Add:

Note:          For electronic notification under paragraph (b), see section 600G.

87  Subsection 468(1)

Omit “and any transfer of shares or alteration in the status of the members of the company”.

88  After section 468

Insert:

468A   Effect of winding up on company’s members

Transfer of shares

             (1)  A transfer of shares in a company that is made after the commencement of the winding up by the Court is void except if:

                     (a)  both:

                              (i)  the liquidator gives written consent to the transfer; and

                             (ii)  that consent is unconditional; or

                     (b)  all of the following subparagraphs apply:

                              (i)  the liquidator gives written consent to the transfer;

                             (ii)  that consent is subject to one or more specified conditions;

                            (iii)  those conditions have been satisfied; or

                     (c)  the Court makes an order under subsection (4) authorising the transfer.

             (2)  The liquidator may only give consent under paragraph (1)(a) or (b) if he or she is satisfied that the transfer is in the best interests of the company’s creditors as a whole.

             (3)  If the liquidator refuses to give consent under paragraph (1)(a) or (b) to a transfer of shares in the company:

                     (a)  the prospective transferor; or

                     (b)  the prospective transferee; or

                     (c)  a creditor of the company;

may apply to the Court for an order authorising the transfer.

             (4)  If the Court is satisfied, on an application under subsection (3), that the transfer is in the best interests of the company’s creditors as a whole, the Court may, by order, authorise the transfer.

             (5)  If the liquidator gives consent under paragraph (1)(b) to a transfer of shares in the company:

                     (a)  the prospective transferor; or

                     (b)  the prospective transferee; or

                     (c)  a creditor of the company;

may apply to the Court for an order setting aside any or all of the conditions to which the consent is subject.

             (6)  If the Court is satisfied, on an application under subsection (5), that any or all of the conditions covered by the application are not in the best interests of the company’s creditors as a whole, the Court may, by order, set aside any or all of the conditions.

             (7)  The liquidator is entitled to be heard in a proceeding before the Court in relation to an application under subsection (3) or (5).

Alteration in the status of members

             (8)  An alteration in the status of members of a company that is made after the commencement of the winding up by the Court is void except if:

                     (a)  both:

                              (i)  the liquidator gives written consent to the alteration; and

                             (ii)  that consent is unconditional; or

                     (b)  all of the following subparagraphs apply:

                              (i)  the liquidator gives written consent to the alteration;

                             (ii)  that consent is subject to one or more specified conditions;

                            (iii)  those conditions have been satisfied; or

                     (c)  the Court makes an order under subsection (12) authorising the alteration.

             (9)  The liquidator may only give consent under paragraph (8)(a) or (b) if he or she is satisfied that the alteration is in the best interests of the company’s creditors as a whole.

           (10)  The liquidator must refuse to give consent under paragraph (8)(a) or (b) if the alteration would contravene Part 2F.2.

           (11)  If the liquidator refuses to give consent under paragraph (8)(a) or (b) to an alteration in the status of members of a company:

                     (a)  a member of the company; or

                     (b)  a creditor of the company;

may apply to the Court for an order authorising the alteration.

           (12)  If the Court is satisfied, on an application under subsection (11), that:

                     (a)  the alteration is in the best interests of the company’s creditors as a whole; and

                     (b)  the alteration does not contravene Part 2F.2;

the Court may, by order, authorise the alteration.

           (13)  If the liquidator gives consent under paragraph (8)(b) to an alteration in the status of members of a company:

                     (a)  a member of the company; or

                     (b)  a creditor of the company;

may apply to the Court for an order setting aside any or all of the conditions to which the consent is subject.

           (14)  If the Court is satisfied, on an application under subsection (13), that any or all of the conditions covered by the application are not in the best interests of the company’s creditors as a whole, the Court may, by order, set aside any or all of the conditions.

           (15)  The liquidator is entitled to be heard in a proceeding before the Court in relation to an application under subsection (11) or (13).

89  Subsection 473(4)

Omit “to which is attached”, substitute “and”.

90  At the end of subsection 473(4)

Add:

Note:          For electronic notification, see section 600G.

91  After subsection 477(3)

Insert:

             (4)  If:

                     (a)  a company is being wound up under a creditors’ voluntary winding up; and

                     (b)  the meeting of creditors has not been held under section 497;

the liquidator of the company must not exercise a power conferred by paragraph (1)(b) or (c) or (2)(m), except with the leave of the Court.

92  Subsection 493(1)

Omit “(1)”.

93  Subsection 493(2)

Repeal the subsection.

94  After section 493

Insert:

493A   Effect of voluntary winding up on company’s members

Transfer of shares

             (1)  A transfer of shares in a company that is made after the passing of the resolution is void except if:

                     (a)  both:

                              (i)  the liquidator gives written consent to the transfer; and

                             (ii)  that consent is unconditional; or

                     (b)  all of the following subparagraphs apply:

                              (i)  the liquidator gives written consent to the transfer;

                             (ii)  that consent is subject to one or more specified conditions;

                            (iii)  those conditions have been satisfied; or

                     (c)  the Court makes an order under subsection (4) authorising the transfer.

             (2)  The liquidator may only give consent under paragraph (1)(a) or (b) if he or she is satisfied that the transfer is in the best interests of the company’s creditors as a whole.

             (3)  If the liquidator refuses to give consent under paragraph (1)(a) or (b) to a transfer of shares in the company:

                     (a)  the prospective transferor; or

                     (b)  the prospective transferee; or

                     (c)  a creditor of the company;

may apply to the Court for an order authorising the transfer.

             (4)  If the Court is satisfied, on an application under subsection (3), that the transfer is in the best interests of the company’s creditors as a whole, the Court may, by order, authorise the transfer.

             (5)  If the liquidator gives consent under paragraph (1)(b) to a transfer of shares in the company:

                     (a)  the prospective transferor; or

                     (b)  the prospective transferee; or

                     (c)  a creditor of the company;

may apply to the Court for an order setting aside any or all of the conditions to which the consent is subject.

             (6)  If the Court is satisfied, on an application under subsection (5), that any or all of the conditions covered by the application are not in the best interests of the company’s creditors as a whole, the Court may, by order, set aside any or all of the conditions.

             (7)  The liquidator is entitled to be heard in a proceeding before the Court in relation to an application under subsection (3) or (5).

Alteration in the status of members

             (8)  An alteration in the status of members of a company that is made after the passing of the resolution is void except if:

                     (a)  both:

                              (i)  the liquidator gives written consent to the alteration; and

                             (ii)  that consent is unconditional; or

                     (b)  all of the following subparagraphs apply:

                              (i)  the liquidator gives written consent to the alteration;

                             (ii)  that consent is subject to one or more specified conditions;

                            (iii)  those conditions have been satisfied; or

                     (c)  the Court makes an order under subsection (12) authorising the alteration.

             (9)  The liquidator may only give consent under paragraph (8)(a) or (b) if he or she is satisfied that the alteration is in the best interests of the company’s creditors as a whole.

           (10)  The liquidator must refuse to give consent under paragraph (8)(a) or (b) if the alteration would contravene Part 2F.2.

           (11)  If the liquidator refuses to give consent under paragraph (8)(a) or (b) to an alteration in the status of members of a company:

                     (a)  a member of the company; or

                     (b)  a creditor of the company;

may apply to the Court for an order authorising the alteration.

           (12)  If the Court is satisfied, on an application under subsection (11), that:

                     (a)  the alteration is in the best interests of the company’s creditors as a whole; and

                     (b)  the alteration does not contravene Part 2F.2;

the Court may, by order, authorise the alteration.

           (13)  If the liquidator gives consent under paragraph (8)(b) to an alteration in the status of members of a company:

                     (a)  a member of the company; or

                     (b)  a creditor of the company;

may apply to the Court for an order setting aside any or all of the conditions to which the consent is subject.

           (14)  If the Court is satisfied, on an application under subsection (13), that any or all of the conditions covered by the application are not in the best interests of the company’s creditors as a whole, the Court may, by order, set aside any or all of the conditions.

           (15)  The liquidator is entitled to be heard in a proceeding before the Court in relation to an application under subsection (11) or (13).

95  At the end of subsection 496(2)

Add:

Note:          For electronic notification, see section 600G.

96  Subsection 496(3)

Omit “$200”, substitute “$1,000”.

97  Subsection 497(1)

Repeal the subsection, substitute:

             (1)  The liquidator of the company must cause a meeting of the company’s creditors to be convened within 11 days after the day of the meeting of the company at which the resolution for voluntary winding up is passed.

98  Subsection 497(2)

Omit “The company”, substitute “The liquidator”.

99  Subsection 497(2)

Omit “a meeting”, substitute “the meeting of the company’s creditors”.

100  Paragraph 497(2)(a)

Omit “by post”.

101  At the end of subsection 497(2)

Add:

Note:          For electronic notification under paragraph (a), see section 600G.

102  Subsection 497(3)

Omit “ requires the company”, substitute “requires the liquidator”.

103  Subsection 497(3)

Omit “$200”, substitute “$1,000”.

104  Subsection 497(3)

Omit “whom the company”, substitute “whom the liquidator”.

105  Subsection 497(3)

Omit “the company must”, substitute “the liquidator must”.

106  Subsection 497(4)

Repeal the subsection.

107  Subsection 497(5)

Repeal the subsection, substitute:

             (5)  Within 7 days after the day of the meeting of the company at which the resolution for voluntary winding up is passed, the directors of the company must give the liquidator a statement, in the prescribed form, about the company’s business, property, affairs and financial circumstances.

108  Subsections 497(6) and (7)

Repeal the subsections.

109  Subsection 497(7A)

Omit “(3), (4), (5) (6) or (7)”, substitute “(5)”.

110  Subsection 497(8)

Omit “director appointed under subsection (5)”, substitute “liquidator”.

111  At the end of section 497

Add:

           (11)  At a meeting of creditors held under this section, the creditors may, by resolution:

                     (a)  remove the liquidator from office; and

                     (b)  appoint another person as liquidator instead.

112  Subsections 499(1) and (2)

Repeal the subsections, substitute:

             (1)  The company in general meeting must appoint a liquidator for the purpose of winding up the affairs and distributing the property of the company.

             (2)  However, subsection (1) does not apply to the company if section 446A applies in relation to the company.

          (2A)  If section 446A applies in relation to the company because of paragraph 446A(1)(a):

                     (a)  the company’s creditors may, at the meeting at which the resolution referred to in that paragraph is passed, appoint a person to be liquidator for the purpose of winding up the affairs and distributing the property of the company; and

                     (b)  if an appointment is not made under paragraph (a) of this subsection before the end of the meeting at which the resolution referred to in paragraph 446A(1)(a) is passed:

                              (i)  the company’s creditors are taken to have appointed the administrator of the company to be liquidator for the purpose of winding up the affairs and distributing the property of the company; and

                             (ii)  the appointment under subparagraph (i) of this paragraph takes effect at the end of that meeting.

          (2B)  If section 446A applies in relation to the company because of paragraph 446A(1)(b):

                     (a)  the company’s creditors are taken to have appointed the administrator of the company to be liquidator for the purpose of winding up the affairs and distributing the property of the company; and

                     (b)  the appointment takes effect at the time referred to in that paragraph.

          (2C)  If section 446A applies in relation to the company because of paragraph 446A(1)(c):

                     (a)  the company’s creditors may, at the meeting at which the resolution referred to in subparagraph 446A(1)(c)(ii) is passed, appoint a person to be liquidator for the purpose of winding up the affairs and distributing the property of the company; and

                     (b)  if an appointment is not made under paragraph (a) of this subsection before the end of the meeting at which the resolution referred to in subparagraph 446A(1)(c)(ii) is passed:

                              (i)  the company’s creditors are taken to have appointed the administrator of the deed to be liquidator for the purpose of winding up the affairs and distributing the property of the company; and

                             (ii)  the appointment under subparagraph (i) of this paragraph takes effect at the end of that meeting.

113  Subsection 506(4)

Repeal the subsection.

114  Before section 530A

Insert:

530   Appointment of 2 or more liquidators of a company

                   If 2 or more persons have been appointed as liquidators of a company:

                     (a)  a function or power of a liquidator of the company may be performed or exercised by any one of them, or by any 2 or more of them together, except so far as the order or resolution appointing them otherwise provides; and

                     (b)  a reference in this Act to a liquidator, or to the liquidator, of a company is, in the case of the first-mentioned company, a reference to whichever one or more of those liquidators the case requires.

530AA   Appointment of 2 or more provisional liquidators of a company

                   If 2 or more persons have been appointed as provisional liquidators of a company:

                     (a)  a function or power of a provisional liquidator of the company may be performed or exercised by any one of them, or by any 2 or more of them together, except so far as the order appointing them otherwise provides; and

                     (b)  a reference in this Act to a provisional liquidator, or to the provisional liquidator, of a company is, in the case of the first-mentioned company, a reference to whichever one or more of those provisional liquidators the case requires.

115  Paragraph 539(4)(b)

Omit “1289(2)”, substitute “1289(5)”.

116  At the end of subsection 539(5)

Add:

Note:          For electronic notification, see section 600G.

117  At the end of section 549

Add:

             (4)  If a member of the committee is a body corporate, the member may be represented at meetings of the committee by:

                     (a)  an officer or employee of the member; or

                     (b)  an individual authorised in writing by the member for the purposes of this subsection.

118  At the end of subsection 550(3)

Add:

Note:          For electronic notification, see section 600G.

119  At the end of subsection 568A(1)

Add:

Note:          For electronic notification under paragraph (b), see section 600G.

120  At the end of Division 3 of Part 5.9

Add:

600G   Electronic methods of giving or sending certain notices etc.

             (1)  This section applies if a person (the notifier ) is authorised or required to give or send a notice, or other document, to a person (the recipient ) under any of the following provisions:

                     (a)  paragraph 436E(3)(a);

                     (b)  paragraph 439A(3)(a);

                     (c)  subsection 439A(4);

                     (d)  subsection 445F(2);

                     (e)  paragraph 449C(5)(a);

                      (f)  subsection 450A(3);

                     (g)  paragraph 450B(a);

                     (h)  paragraph 450C(b);

                      (i)  paragraph 450D(b);

                      (j)  subsection 473(4);

                     (k)  subsection 496(2);

                      (l)  paragraph 497(2)(a);

                    (m)  subsection 508(4);

                     (n)  subsection 539(5);

                     (o)  subsection 550(3);

                     (p)  paragraph 568A(1)(b);

                     (q)  subsection 574(2);

                      (r)  subsection 574(3);

                      (s)  subsection 579J(1);

                      (t)  subsection 579J(2);

                     (u)  subsection 579K(1);

                     (v)  subsection 579K(2);

                    (w)  subsection 579K(3);

                     (x)  subsection 579K(4).

             (2)  If the recipient nominates a fax number, or electronic address, by which the recipient may be notified of such notices or documents, the notifier may give or send the notice or document to the recipient by sending it to that fax number or electronic address.

             (3)  If the recipient nominates any other electronic means by which the recipient may be notified of such notices or documents, the notifier may give or send the notice or document to the recipient by using that electronic means.

             (4)  If the recipient nominates:

                     (a)  an electronic means (the nominated notification means ) by which the recipient may be notified that such notices or documents are available; and

                     (b)  an electronic means (the nominated access means ) the recipient may use to access such notices or documents;

the notifier may give or send the document to the recipient by notifying the recipient (using the nominated notification means):

                     (c)  that the notice or document is available; and

                     (d)  how the recipient may use the nominated access means to access the notice or document.

             (5)  A notice or document sent to a fax number or electronic address, or by other electronic means, is taken to be given or sent on the business day after it is sent.

             (6)  A notice or document given or sent under subsection (4) is taken to be given or sent on the business day after the day on which the recipient is notified that the notice or document is available.

             (7)  Subsections (2), (3) and (4) do not limit the provisions mentioned in subsection (1).

121  Schedule 3 (after table item 20)

Insert:

20A

Subsection 161A(2) or (3)

10 penalty units or imprisonment for 3 months, or both.



 

Part 4 Facilitating pooling in external administration

Corporations Act 2001

122  Section 9

Insert:

pooling determination means a determination under subsection 571(1).

123  Section 9

Insert:

pooling order means an order under subsection 579E(1).

124  At the end of subsection 473(3)

Add:

Note:          See also section 579L (consolidated meetings of creditors—pooled groups).

125  At the end of section 538

Add:

             (3)  Regulations made for the purposes of this section may apply in relation to the winding up of a company that is subject to:

                     (a)  a pooling determination; or

                     (b)  a pooling order.

             (4)  Subsection (3) does not limit subsection (2).

126  At the end of section 539

Add:

             (7)  If:

                     (a)  a pooling determination is in force in relation to a group of 2 or more companies; or

                     (b)  a pooling order is in force in relation to a group of 2 or more companies;

then:

                     (c)  the accounts under subsection (1) for the companies in the group may be set out in the same document; and

                     (d)  the statements under subsection (1) for the companies in the group may be set out in the same document.

127  Subsection 548(3)

After “inspection”, insert “as a result of a determination under subsection (1)”.

Note:       The heading to section 548 is altered by adding at the end “ —company not in pooled group ”.

128  At the end of section 548

Add:

             (4)  This section does not apply in relation to a company if:

                     (a)  either:

                              (i)  a pooling determination is in force in relation to a group of 2 or more companies; or

                             (ii)  a pooling order is in force in relation to a group of 2 or more companies; and

                     (b)  the company is in the group.

129  After section 548

Insert:

548A   Convening of meeting for appointment of committee of inspection—pooled group

             (1)  If:

                     (a)  either:

                              (i)  a pooling determination is in force in relation to a group of 2 or more companies; or

                             (ii)  a pooling order is in force in relation to a group of 2 or more companies; and

                     (b)  each company in the group is being wound up;

the liquidator or liquidators must, if requested by a creditor of a company in the group, convene a meeting, on a consolidated basis, of the creditors of the companies in the group for the purposes of determining:

                     (c)  whether a committee of inspection should be appointed for the group; and

                     (d)  if a committee of inspection is to be appointed:

                              (i)  the number of members to represent the creditors of the companies in the group; and

                             (ii)  the persons who are to be members of the committee representing the creditors of the companies in the group.

             (2)  The regulations may make provision for or in relation to:

                     (a)  the convening of, conduct of, and procedure and voting at, consolidated meetings of creditors; and

                     (b)  the number of persons required to constitute a quorum at any such meeting; and

                     (c)  the sending of notices of meetings to persons entitled to attend any such meeting; and

                     (d)  the lodging of copies of notices of, and of resolutions passed at, any such meeting; and

                     (e)  generally regulating the conduct of, and procedure at, any such meeting.

             (3)  A person is not eligible to be appointed as a member of a committee of inspection as a result of a determination under subsection (1) unless the person is an eligible unsecured creditor (within the meaning of Division 8) of a company in the group.

Note:          For eligible unsecured creditor , see section 579Q.

             (4)  A committee of inspection for a group of 2 or more companies is taken to be a committee of inspection for each company in the group.

             (5)  If:

                     (a)  a determination is made under subsection (1); and

                     (b)  immediately before the determination was made, a committee of inspection was in existence for a company in the group;

the committee mentioned in paragraph (b) ceases to exist when the determination is made.

130  Subsection 549(2)

Omit “The liquidator”, substitute “In the case of a committee of inspection appointed as a result of a determination under subsection 548(1), the liquidator”.

131  After subsection 549(2)

Insert:

          (2A)  In the case of a committee of inspection appointed as a result of a determination under subsection 548A(1), either:

                     (a)  the liquidator or liquidators of the companies in the group concerned; or

                     (b)  a member of the committee;

may convene a meeting of the committee.

132  Subsection 553(1)

After “this Division”, insert “and Division 8”.

133  After Division 7B of Part 5.6

Insert:

Division 8 Pooling

Subdivision A Pooling determinations

571   Pooling determination

Making of pooling determination

             (1)  If the following conditions are satisfied in relation to a group of 2 or more companies:

                     (a)  each company in the group is being wound up;

                     (b)  any of the following subparagraphs applies:

                              (i)  each company in the group is a related body corporate of each other company in the group;

                             (ii)  apart from this section, the companies in the group are jointly liable for one or more debts or claims;

                            (iii)  the companies in the group jointly own or operate particular property that is or was used, or for use, in connection with a business, a scheme, or an undertaking, carried on jointly by the companies in the group;

                            (iv)  one or more companies in the group own particular property that is or was used, or for use, by any or all of the companies in the group in connection with a business, a scheme, or an undertaking, carried on jointly by the companies in the group;

the liquidator or liquidators of the companies may, by writing:

                     (c)  determine that the group is a pooled group for the purposes of this section; and

                     (d)  if the liquidator or liquidators consider that it is just and equitable, as between the various creditors of the companies in the group, to do so—determine that any or all of the following provisions:

                              (i)  subsection (2);

                             (ii)  subsection (3);

                            (iii)  subsection (4);

                            (iv)  subsection (5);

                             (v)  subsection (6);

                            (vi)  subsection (7);

                            are modified, as set out in the determination, in their application to the companies in the group.

Note 1:       Section 9 provides that pooling determination means a determination under subsection (1) of this section.

Note 2:       A pooling determination comes into force when it is approved by the eligible unsecured creditors of each of the companies in the group—see section 578.

Consequences of pooling determination

             (2)  If a determination under paragraph (1)(c) comes into force in relation to a group of 2 or more companies:

                     (a)  each company in the group is taken to be jointly and severally liable for each debt payable by, and each claim against, each other company in the group; and

                     (b)  each debt payable by a company or companies in the group to any other company or companies in the group is extinguished; and

                     (c)  each claim that a company or companies in the group has against any other company or companies in the group is extinguished.

             (3)  Subsection (2) applies to a debt or claim:

                     (a)  whether present or future; and

                     (b)  whether certain or contingent; and

                     (c)  whether ascertained or sounding only in damages.

             (4)  Subsection (2) does not apply to a debt payable by, or a claim against, a company in the group unless the debt or claim is admissible to proof against the company.

             (5)  If a determination under paragraph (1)(c) comes into force in relation to a group of 2 or more companies, the order of priority applicable under sections 556, 560 and 561 is not altered for a company in the group.

             (6)  If:

                     (a)  a determination under paragraph (1)(c) comes into force in relation to a group of 2 or more companies; and

                     (b)  a secured creditor of a company in the group surrenders the relevant security to the liquidator of the company for the benefit of creditors of the companies in the group generally;

the debt may be recovered as a debt that is jointly and severally payable by the companies in the group.

             (7)  If:

                     (a)  a determination under paragraph (1)(c) comes into force in relation to a group of 2 or more companies; and

                     (b)  a secured creditor of a company in the group realises the security;

so much of the debt as remains after deducting the net amount realised may be recovered as a debt that is jointly and severally payable by the companies in the group.

             (8)  The following provisions have effect subject to any modifications under paragraph (1)(d):

                     (a)  subsection (2);

                     (b)  subsection (3);

                     (c)  subsection (4);

                     (d)  subsection (5);

                     (e)  subsection (6);

                      (f)  subsection (7).

             (9)  Subsection (2) does not apply in relation to a secured creditor unless the relevant debt is payable by a company or companies in the group to any other company or companies in the group.

           (10)  If:

                     (a)  a pooling determination comes into force in relation to a group of 2 or more companies; and

                     (b)  there are one or more eligible employee creditors of a company in the group;

those eligible employee creditors are entitled to a priority at least equal to what they would have been entitled if the determination had not been made.

Section 477 not limited

           (11)  This section does not limit section 477.

572   Variation of pooling determination

                   If a pooling determination is in force in relation to a group of 2 or more companies, the liquidator or liquidators of the companies may, by writing, vary the determination.

Note:          A variation of a pooling determination comes into force when it is approved by the creditors of the companies in the group—see section 578.

573   Lodgment of copy of pooling determination etc.

Pooling determination

             (1)  Within 7 days after a pooling determination comes into force in relation to a group of 2 or more companies, the liquidator or liquidators of the companies in the group must lodge a copy of the determination with ASIC.

Note:          A pooling determination comes into force when it is approved by the eligible unsecured creditors of each of the companies in the group—see section 578.

Variation of pooling determination

             (2)  Within 7 days after a variation of a pooling determination comes into force in relation to a group of 2 or more companies, the liquidator or liquidators of the companies in the group must lodge a copy of the variation with ASIC.

Note:          A variation of a pooling determination comes into force when it is approved by the eligible unsecured creditors of each of the companies in the group—see section 578.

574   Eligible unsecured creditors must approve the making or variation of a pooling determination

Convening of meetings of creditors

             (1)  Within 5 business days after the liquidator or liquidators of a group of 2 or more companies:

                     (a)  make a pooling determination in relation to the group; or

                     (b)  vary a pooling determination in force in relation to the group;

the liquidator or liquidators must convene separate meetings of the eligible unsecured creditors of each of the companies in the group.

Note:          For eligible unsecured creditor , see section 579Q.

Notice of meeting

             (2)  A liquidator of a company must convene a meeting of the eligible unsecured creditors of the company by giving written notice of the meeting to the company’s eligible unsecured creditors at least 5 business days before the meeting.

Note:          For electronic notification under this subsection, see section 600G.

             (3)  The notice given to an eligible unsecured creditor under subsection (2) must be accompanied by:

                     (a)  a copy of the determination or variation; and

                     (b)  a written statement:

                              (i)  identifying each of the companies in the group; and

                             (ii)  setting out the opinion of the liquidator about each of the matters specified in subsection (4), and the reasons of the liquidator for those opinions; and

                            (iii)  if the liquidator considers that any eligible unsecured creditors are likely to be disadvantaged by the coming into force of the determination or variation—the reasons (if any) why the liquidator considers that those disadvantaged eligible unsecured creditors should vote for a resolution approving the making of the determination or variation; and

                            (iv)  setting out such other information known to the liquidator as will enable the eligible unsecured creditors to make an informed decision about whether to approve the making of the determination or variation.

Note:          For electronic notification under this subsection, see section 600G.

             (4)  For the purposes of subparagraph (3)(b)(ii), the matters are as follows:

                     (a)  whether it would be in the eligible unsecured creditors’ interests generally for the determination or variation to come into force;

                     (b)  the extent to which particular eligible unsecured creditors are likely to be disadvantaged by the coming into force of the determination or variation;

                     (c)  the extent to which particular companies in the group are likely to be disadvantaged by the coming into force of the determination or variation;

                     (d)  the likely return to eligible unsecured creditors if the determination or variation were to come into force;

                     (e)  the likely return to eligible unsecured creditors if the determination or variation were not to come into force.

575   Members’ voluntary winding up—copy of notice etc. to be given to each member of the company

                   If:

                     (a)  a company is being wound up under a members’ voluntary winding up; and

                     (b)  the liquidator of the company convenes a meeting of the eligible unsecured creditors of the company under section 574;

the liquidator must, within 5 business days after convening the meeting, give a copy of:

                     (c)  the subsection 574(2) notice; and

                     (d)  the paragraph 574(3)(b) statement;

to each member of the company, so long as the member is not a company in the group concerned.

576   Conduct of meeting

             (1)  At a meeting convened under section 574, the liquidator is to preside.

             (2)  A meeting convened under section 574 may be adjourned from time to time.

577   Eligible unsecured creditors may decide to approve the determination or variation

             (1)  At a meeting convened under section 574, the eligible unsecured creditors may resolve to approve the making of the determination or variation.

Note:          For eligible unsecured creditor , see section 579Q.

             (2)  A resolution under subsection (1) must be agreed to by a majority in number of the eligible unsecured creditors present and voting, either in person or by proxy, being a majority whose debts or claims against the company amount in the aggregate to at least 75% of the total amount of the debts and claims of the eligible unsecured creditors present and voting in person or by proxy.

             (3)  If, at a meeting convened under section 574, the eligible unsecured creditors do not resolve to approve the making of the determination or variation:

                     (a)  the determination or variation is cancelled at the end of the meeting; and

                     (b)  if, as at the end of the meeting, a corresponding resolution has not been considered at another meeting convened under section 574 of the eligible unsecured creditors of another company in the group—that other meeting is cancelled.

578   When pooling determination comes into force etc.

Pooling determination

             (1)  If:

                     (a)  a pooling determination is made in relation to a group of 2 or more companies; and

                     (b)  meetings are convened under section 574 of the eligible unsecured creditors of each company in the group; and

                     (c)  at each meeting, the eligible unsecured creditors pass a resolution, in accordance with section 577, approving the making of the determination;

then:

                     (d)  if all the resolutions were passed at the same time—the determination comes into force immediately after the resolutions were passed; or

                     (e)  if the resolutions were passed at different times—the determination comes into force immediately after the last of those times.

Note:          For eligible unsecured creditor , see section 579Q.

Variation of pooling determination

             (2)  If:

                     (a)  a pooling determination is in force in relation to a group of 2 or more companies; and

                     (b)  the pooling determination is varied; and

                     (c)  meetings are convened under section 574 of the eligible unsecured creditors of each company in the group; and

                     (d)  at each meeting, the eligible unsecured creditors pass a resolution, in accordance with section 577, approving the making of the variation;

then:

                     (e)  if all the resolutions were passed at the same time—the variation comes into force immediately after the resolutions were passed; or

                      (f)  if the resolutions were passed at different times—the variation comes into force immediately after the last of those times.

Note:          For eligible unsecured creditor , see section 579Q.

579   Duties of liquidator

             (1)  This section applies if:

                     (a)  the liquidator or liquidators of a group of 2 or more companies exercise a power conferred by section 571 or 574; and

                     (b)  the liquidator or liquidators, in the exercise of that power, acted:

                              (i)  with due care; and

                             (ii)  in good faith; and

                            (iii)  for the benefit of the creditors of the companies in the group, considered as a whole.

             (2)  The liquidator or liquidators are taken not to be in breach of:

                     (a)  any duty to a company in the group concerned (whether under section 180, 181, 182, 183 or 184 or otherwise and whether of a fiduciary nature or not); or

                     (b)  any duty to the creditors of a company in the group concerned (whether of a fiduciary nature or not);

in connection with the exercise of that power.

579A   Court may vary or terminate pooling determination

             (1)  If a pooling determination is in force in relation to a group of 2 or more companies, the Court may make an order varying or terminating the pooling determination if the Court is satisfied that:

                     (a)  information that was about the business, property, affairs or financial circumstances of a company in the group, and that:

                              (i)  was false or misleading; and

                             (ii)  can reasonably be expected to have been material to eligible unsecured creditors of a company in the group in deciding whether to vote in favour of a resolution to approve the making of the pooling determination;

                            was given to:

                            (iii)  the liquidator of a company in the group; or

                            (iv)  eligible unsecured creditors of a company in the group; or

                     (b)  information that was about the business, property, affairs or financial circumstances of a company in the group, and that:

                              (i)  was false or misleading; and

                             (ii)  can reasonably be expected to have been material to eligible unsecured creditors of a company in the group in deciding whether to vote in favour of a resolution to approve the making of the pooling determination;

                            was contained in a statement under paragraph 574(3)(b) that accompanied a notice of the meeting at which the resolution was passed; or

                     (c)  there was an omission from such a statement, and the omission can reasonably be expected to have been material to any of those eligible unsecured creditors in deciding whether to vote in favour of a resolution to approve the making of the pooling determination; or

                     (d)  effect cannot be given to the pooling determination without injustice or undue delay; or

                     (e)  the pooling determination would materially disadvantage an eligible unsecured creditor who is an applicant for the order; or

                      (f)  the pooling determination would be oppressive or unfairly prejudicial to, or unfairly discriminatory against, an applicant for the order who is an eligible unsecured creditor of a company in the group; or

                     (g)  the pooling determination would be contrary to the interests of the creditors of the companies in the group, considered as a whole; or

                     (h)  in a case where a company in the group is being wound up under a members’ voluntary winding up:

                              (i)  the pooling determination would materially disadvantage a member of the company who is an applicant for the order; or

                             (ii)  the pooling determination would be oppressive or unfairly prejudicial to, or unfairly discriminatory against, one or more such members; or

                            (iii)  the pooling determination would be contrary to the interests of the members of the company as a whole; or

                      (i)  the pooling determination should be varied or terminated for some other reason.

Note:          For eligible unsecured creditor , see section 579Q.

             (2)  An order may only be made on the application of:

                     (a)  a creditor of a company in the group; or

                     (b)  in a case where a company in the group is being wound up under a members’ voluntary winding up—a member of the company, so long as the member is not a company in the group; or

                     (c)  any other interested person.

579B   Court may cancel or confirm variation

             (1)  If:

                     (a)  a pooling determination is in force in relation to a group of 2 or more companies; and

                     (b)  the determination is varied; and

                     (c)  the variation has come into force;

either of the following persons may apply to the Court for an order cancelling the variation:

                     (d)  a creditor of a company in the group;

                     (e)  in a case where a company in the group is being wound up under a members’ voluntary winding up—a member of the company, so long as the member is not a company in the group.

             (2)  On an application, the Court:

                     (a)  may make an order cancelling the variation, or confirming it, either wholly or in part, on such conditions (if any) as the order specifies; and

                     (b)  may make such other orders as it thinks appropriate.

579C   When Court may void or validate pooling determination

             (1)  If there is doubt, on a specific ground, whether a pooling determination that relates to a group of 2 or more companies:

                     (a)  was made, varied or approved in accordance with this Division; or

                     (b)  complies with this Division;

any of the following persons may apply to the Court for an order under this section:

                     (c)  the liquidator of a company in the group;

                     (d)  a creditor of a company in the group;

                     (e)  in a case where a company in the group is being wound up under a members’ voluntary winding up—a member of the company, so long as the member is not a company in the group;

                      (f)  ASIC.

             (2)  On an application, the Court may make an order declaring the pooling determination, or a provision of it, to be void or not to be void, as the case requires, on the ground specified in the application or some other ground.

             (3)  On an application, the Court may declare the pooling determination, or a provision of it, to be valid, despite a contravention of a provision of this Division, if the Court is satisfied that:

                     (a)  the provision was substantially complied with; and

                     (b)  no injustice will result for anyone affected by the pooling determination if the contravention is disregarded.

             (4)  If the Court declares a provision of a pooling determination to be void, the Court may, by order, vary the pooling determination.

579D   Effect of termination or avoidance

                   The termination or avoidance, in whole or in part, of a pooling determination does not affect the previous operation of:

                     (a)  the pooling determination; or

                     (b)  this Division in so far as it relates to the pooling determination.

Subdivision B Pooling orders

579E   Pooling orders

Making of pooling order

             (1)  If it appears to the Court that the following conditions are satisfied in relation to a group of 2 or more companies:

                     (a)  each company in the group is being wound up;

                     (b)  any of the following subparagraphs applies:

                              (i)  each company in the group is a related body corporate of each other company in the group;

                             (ii)  apart from this section, the companies in the group are jointly liable for one or more debts or claims;

                            (iii)  the companies in the group jointly own or operate particular property that is or was used, or for use, in connection with a business, a scheme, or an undertaking, carried on jointly by the companies in the group;

                            (iv)  one or more companies in the group own particular property that is or was used, or for use, by any or all of the companies in the group in connection with a business, a scheme, or an undertaking, carried on jointly by the companies in the group;

the Court may, if the Court is satisfied that it is just and equitable to do so, by order, determine that the group is a pooled group for the purposes of this section.

Note 1:       Section 9 provides that pooling order means an order under subsection (1) of this section.

Note 2:       See also subsection (12) (just and equitable criteria).

Consequences of pooling order

             (2)  If a pooling order comes into force in relation to a group of 2 or more companies:

                     (a)  each company in the group is taken to be jointly and severally liable for each debt payable by, and each claim against, each other company in the group; and

                     (b)  each debt payable by a company or companies in the group to any other company or companies in the group is extinguished; and

                     (c)  each claim that a company or companies in the group has against any other company or companies in the group is extinguished.

Note:          For exemptions, see paragraph 579G(1)(a).

             (3)  Subsection (2) applies to a debt or claim:

                     (a)  whether present or future; and

                     (b)  whether certain or contingent; and

                     (c)  whether ascertained or sounding only in damages.

             (4)  Subsection (2) does not apply to a debt payable by, or a claim against, a company in the group unless the debt or claim is admissible to proof against the company.

             (5)  If a pooling order comes into force in relation to a group of 2 or more companies, the order of priority applicable under sections 556, 560 and 561 is not altered for a company in the group.

             (6)  If:

                     (a)  a pooling order comes into force in relation to a group of 2 or more companies; and

                     (b)  a secured creditor of a company in the group surrenders the relevant security to the liquidator of the company for the benefit of creditors of the companies in the group generally;

the debt may be recovered as a debt that is jointly and severally payable by the companies in the group.

             (7)  If:

                     (a)  a pooling order comes into force in relation to a group of 2 or more companies; and

                     (b)  a secured creditor of a company in the group realises the security;

so much of the debt as remains after deducting the net amount realised may be recovered as a debt that is jointly and severally payable by the companies in the group.

             (8)  The following provisions have effect subject to any modifications under paragraph 579G(1)(d):

                     (a)  subsection (2);

                     (b)  subsection (3);

                     (c)  subsection (4);

                     (d)  subsection (5);

                     (e)  subsection (6);

                      (f)  subsection (7).

             (9)  Subsection (2) does not apply in relation to a secured creditor unless the relevant debt is payable by a company or companies in the group to any other company or companies in the group.

           (10)  The Court must not make a pooling order in relation to a group of 2 or more companies if:

                     (a)  both:

                              (i)  the Court is satisfied the order would materially disadvantage an eligible unsecured creditor of a company in the group; and

                             (ii)  the eligible unsecured creditor has not consented to the making of the order; or

                     (b)  all of the following conditions are satisfied:

                              (i)  a company in the group is being wound up under a members’ voluntary winding up;

                             (ii)  the Court is satisfied that the order would materially disadvantage a member of that company;

                            (iii)  the member is not a company in the group;

                            (iv)  the member has not consented to the making of the order.

Note:          For eligible unsecured creditor , see section 579Q.

Standing

           (11)  The Court may only make a pooling order on the application of the liquidator or liquidators of the companies in the group.

Just and equitable criteria

           (12)  In determining whether it is just and equitable to make a pooling order, the Court must have regard to all of the following matters:

                     (a)  the extent to which:

                              (i)  a company in the group; and

                             (ii)  the officers or employees of a company in the group;

                            were involved in the management or operations of any of the other companies in the group;

                     (b)  the conduct of:

                              (i)  a company in the group; and

                             (ii)  the officers or employees of a company in the group;

                            towards the creditors of any of the other companies in the group;

                     (c)  the extent to which the circumstances that gave rise to the winding up of any of the companies in the group are directly or indirectly attributable to the acts or omissions of:

                              (i)  any of the other companies in the group; or

                             (ii)  the officers or employees of any of the other companies in the group;

                     (d)  the extent to which the activities and business of the companies in the group have been intermingled;

                     (e)  the extent to which creditors of any of the companies in the group may be advantaged or disadvantaged by the making of the order;

                      (f)  any other relevant matters.

Lodgment of pooling order

           (13)  A pooling order must be lodged with ASIC.

579F   Variation of pooling orders

             (1)  The Court may, by order, vary a pooling order if the Court is of the opinion that it is just and equitable to do so.

             (2)  A pooling order may only be varied on the application of:

                     (a)  the liquidator of a company in the group; or

                     (b)  a creditor of a company in the group; or

                     (c)  in a case where a company in the group is being wound up under a members’ voluntary winding up—a member of the company, so long as the member is not a company in the group.

Lodgment of order

             (3)  An order under subsection (1) must be lodged with ASIC.

579G   Court may make ancillary orders etc.

             (1)  If the Court makes a pooling order in relation to a group of 2 or more companies, the Court may, if the Court is of the opinion that it is just and equitable to do so, do any or all of the following things:

                     (a)  by order, exempt:

                              (i)  a specified debt or claim; or

                             (ii)  a specified class of debts or claims;

                            from the application of subsection 579E(2) to the group;

                     (b)  by order, transfer, or direct the transfer, of:

                              (i)  specified property; or

                             (ii)  a specified class of property;

                            from a company in the group to another company in the group;

                     (c)  by order, transfer, or direct the transfer, of liability for:

                              (i)  a specified debt or claim; or

                             (ii)  a specified class of debts or claims;

                            from a company in the group to another company in the group;

                     (d)  by order, modify the application of this Act in relation to the winding up of the companies in the group;

                     (e)  make such other orders, and give such directions, in relation to the winding up of the companies in the group, as the Court thinks fit.

Standing

             (2)  An order or direction under subsection (1) may only be made or given on the application of:

                     (a)  the liquidator of a company in the group; or

                     (b)  a creditor of a company in the group; or

                     (c)  in a case where a company in the group is being wound up under a members’ voluntary winding up—a member of the company, so long as the member is not a company in the group.

Conditional orders etc.

             (3)  An order or direction under subsection (1) may be made or given subject to conditions.

             (4)  An order or direction under subsection (1) may provide for different returns for different creditors or classes of creditors.

             (5)  An order or direction under subsection (1) may provide for the subordination of the debts and claims of specified creditors or classes of creditors to those of other creditors.

             (6)  Subsections (4) and (5) do not limit subsection (1) or (3).

Rights of secured creditors

             (7)  An order or direction under subsection (1) does not affect the rights of a secured creditor, unless the relevant debt is payable by a company or companies in the group to any other company or companies in the group.

Lodgment of order or direction

             (8)  An order or direction under subsection (1) must be lodged with ASIC.

579H   Variation of ancillary orders etc.

Variation of ancillary order

             (1)  The Court may, by order, vary an order made under subsection 579G(1) if the Court is of the opinion that it is just and equitable to do so.

             (2)  An order made under subsection 579G(1) may only be varied on the application of:

                     (a)  the liquidator of a company in the group; or

                     (b)  a creditor of a company in the group, so long as the creditor is not a company in the group; or

                     (c)  in a case where a company in the group is being wound up under a members’ voluntary winding up—a member of the company, so long as the member is not a company in the group.

Variation of direction

             (3)  The Court may vary a direction given under subsection 579G(1) if the Court is of the opinion that it is just and equitable to do so.

             (4)  A direction given under subsection 579G(1) may only be varied on the application of:

                     (a)  the liquidator of a company in the group; or

                     (b)  a creditor of a company in the group; or

                     (c)  in a case where a company in the group is being wound up under a members’ voluntary winding up—a member of the company, so long as the member is not a company in the group.

Lodgment of order or direction

             (5)  An order under subsection (1) must be lodged with ASIC.

             (6)  A variation of a direction given under subsection 579G(1) must be lodged with ASIC.

579J   Notice of application for pooling order etc.

             (1)  If the liquidator or liquidators of the companies in a group apply for a pooling order, the liquidator or liquidators must give written notice of:

                     (a)  the application; or

                     (b)  an Internet site where persons can view a copy of the application;

to:

                     (c)  each eligible unsecured creditor of each company in the group; and

                     (d)  in a case where a company in the group is being wound up under a members’ voluntary winding up—each member of the company, so long as the member is not a company in the group; and

                     (e)  such other persons (if any) as the Court directs.

Note 1:       For eligible unsecured creditor , see section 579Q.

Note 2:       For electronic notification under this subsection, see section 600G.

             (2)  If:

                     (a)  a pooling order is made in relation to a group of 2 or more companies; and

                     (b)  the liquidator of a company in the group applies for:

                              (i)  an order under subsection 579F(1); or

                             (ii)  an order under subsection 579G(1); or

                            (iii)  an order under subsection 579H(1); or

                            (iv)  a direction under subsection 579G(1); or

                             (v)  a variation of a direction given under subsection 579G(1);

the liquidator must give written notice of:

                     (c)  the application; or

                     (d)  an Internet site where persons can view a copy of the application;

to:

                     (e)  each eligible unsecured creditor of each company in the group; and

                      (f)  in a case where a company in the group is being wound up under a members’ voluntary winding up—each member of the company, so long as the member is not a company in the group; and

                     (g)  such other persons (if any) as the Court directs.

Note 1:       For eligible unsecured creditor , see section 579Q.

Note 2:       For electronic notification under this subsection, see section 600G.

579K   Notice of pooling order etc.

Notice of pooling order

             (1)  If a pooling order is made in relation to a group of 2 or more companies, the liquidator or liquidators of the companies in the group must:

                     (a)  give each eligible unsecured creditor of each company in the group a written notice setting out:

                              (i)  the order; and

                             (ii)  a summary description of the order; or

                     (b)  give each eligible unsecured creditor of each company in the group a written notice of an Internet site where persons can view a copy of:

                              (i)  the order; and

                             (ii)  a summary description of the order.

Note 1:       For eligible unsecured creditor , see section 579Q.

Note 2:       For electronic notification under this subsection, see section 600G.

             (2)  If:

                     (a)  a pooling order is made in relation to a group of 2 or more companies; and

                     (b)  a company in the group is being wound up under a members’ voluntary winding up;

the liquidator or liquidators of the companies in the group must:

                     (c)  give each member of that company a written notice setting out:

                              (i)  the order; and

                             (ii)  a summary description of the order;

                            so long as the member is not a company in the group; or

                     (d)  give each member of that company a written notice of an Internet site where persons can view a copy of:

                              (i)  the order; and

                             (ii)  a summary description of the order;

                            so long as the member is not a company in the group.

Note:          For electronic notification under this subsection, see section 600G.

Notice of application by liquidator

             (3)  If:

                     (a)  a pooling order is made in relation to a group of 2 or more companies; and

                     (b)  the Court does any of the following on the application of a liquidator of a company in the group:

                              (i)  makes an order under subsection 579F(1);

                             (ii)  makes an order under subsection 579G(1);

                            (iii)  makes an order under subsection 579H(1);

                            (iv)  gives a direction under subsection 579G(1);

                             (v)  varies a direction given under subsection 579G(1);

the liquidator must:

                     (c)  give each eligible unsecured creditor of each company in the group a written notice setting out:

                              (i)  the order, direction or variation; and

                             (ii)  a summary description of the order, direction or variation; or

                     (d)  give each eligible unsecured creditor of each company in the group a written notice of an Internet site where persons can view a copy of:

                              (i)  the order, direction or variation; and

                             (ii)  a summary description of the order, direction or variation.

Note 1:       For eligible unsecured creditor , see section 579Q.

Note 2:       For electronic notification under this subsection, see section 600G.

             (4)  If:

                     (a)  a pooling order is made in relation to a group of 2 or more companies; and

                     (b)  the Court does any of the following on the application of a liquidator of a company in the group:

                              (i)  makes an order under subsection 579F(1);

                             (ii)  makes an order under subsection 579G(1);

                            (iii)  makes an order under subsection 579H(1);

                            (iv)  gives a direction under subsection 579G(1);

                             (v)  varies a direction given under subsection 579G(1); and

                     (c)  a company in the group is being wound up under a members’ voluntary winding up;

the liquidator must:

                     (d)  give each member of that company a written notice setting out:

                              (i)  the order, direction or variation; and

                             (ii)  a summary description of the order, direction or variation;

                            so long as the member is not a company in the group; or

                     (e)  give each member of that company a written notice of an Internet site where persons can view a copy of:

                              (i)  the order, direction or variation; and

                             (ii)  a summary description of the order, direction or variation;

                            so long as the member is not a company in the group.

Note:          For electronic notification under this subsection, see section 600G.

579L   Consolidated meetings of creditors

             (1)  If:

                     (a)  either:

                              (i)  a pooling determination is in force in relation to a group of 2 or more companies; or

                             (ii)  a pooling order is in force in relation to a group of 2 or more companies; and

                     (b)  each company in the group is being wound up;

then, unless the Court otherwise orders:

                     (c)  instead of convening separate meetings under or for the purposes of a particular provision of this Act, the liquidator or liquidators may convene a meeting under or for the purposes of that provision, on a consolidated basis, of the creditors of the companies in the group; and

                     (d)  a resolution passed at a consolidated meeting by those creditors is taken to have been passed by the creditors of each of the companies in the group; and

                     (e)  if there are 2 or more liquidators—one of those liquidators is to preside at a consolidated meeting; and

                      (f)  notice of a consolidated meeting may be given by the liquidator or liquidators.

Note:          See also section 548A (committee of inspection).

             (2)  The regulations may make provision for or in relation to:

                     (a)  the convening of, conduct of, and procedure and voting at, consolidated meetings of creditors; and

                     (b)  the number of persons required to constitute a quorum at any such meeting; and

                     (c)  the sending of notices of meetings to persons entitled to attend any such meeting; and

                     (d)  the lodging of copies of notices of, and of resolutions passed at, any such meeting; and

                     (e)  generally regulating the conduct of, and procedure at, any such meeting.

Subdivision C Other provisions

579M   When debts or claims are provable in winding up

                   If a debt or claim becomes a debt payable by, or a claim against, a company under any of the following provisions:

                     (a)  subsection 571(2) (including that subsection as modified by a determination under paragraph 571(1)(d));

                     (b)  subsection 571(6) (including that subsection as modified by a determination under paragraph 571(1)(d));

                     (c)  subsection 571(7) (including that subsection as modified by a determination under paragraph 571(1)(d));

                     (d)  subsection 579E(2) (including that subsection as modified by an order under paragraph 579G(1)(d));

                     (e)  subsection 579E(6) (including that subsection as modified by an order under paragraph 579G(1)(d));

                      (f)  subsection 579E(7) (including that subsection as modified by an order under paragraph 579G(1)(d));

                     (g)  subsection 579G(1);

then, in the winding up of the company, the debt or claim is admissible to proof against the company.

579N   Group of companies

                   To avoid doubt, for the purposes of:

                     (a)  this Division; or

                     (b)  any other provision of this Act to the extent to which it relates to this Division;

a group of 2 or more companies need not be associated with each other in any way (other than a way described in paragraph 571(1)(b) or 579E(1)(b)).

579P   Secured debt may become unsecured

                   For the purposes of this Division, a secured debt becomes an unsecured debt to the extent that the creditor proves for the debt as an unsecured creditor.

579Q   Eligible unsecured creditor

             (1)  Subject to subsection (2), for the purposes of the application of this Division to a group of 2 or more companies, a creditor of a company in the group is an eligible unsecured creditor of that company if:

                     (a)  both:

                              (i)  the creditor’s debt or claim is unsecured; and

                             (ii)  the creditor is not a company in the group; or

                     (b)  the creditor is specified in the regulations.

Note:          For specification by class, see subsection 13(3) of the Legislative Instruments Act 2003 .

             (2)  The regulations may provide that, for the purposes of the application of this Division to a group of 2 or more companies, a specified creditor of a company in the group is not an eligible unsecured creditor of that company.

Note:          For specification by class, see subsection 13(3) of the Legislative Instruments Act 2003 .