Corporations Act 2001
On application by ASIC, the Court may disqualify a person from managing corporations for a period that the Court considers appropriate if:
(a) subsection (2) applies to the person in relation to 2 or more corporations; and
(b) the Court is satisfied that the disqualification is justified. 206EAB(2)
This subsection applies to the person in relation to a corporation if:
(a) within the last 7 years:
(i) the person has been an officer of the corporation; and
(ii) while the person was an officer, or within 12 months after the person ceased to be an officer, the corporation began to be wound up; and
(iii) money was advanced for the purposes of paying the entitlements of employees of the corporation under the Fair Entitlements Guarantee Act 2012 ; and
(b) the Commonwealth has received a minimal return, or no return, on the advance (whether or not the corporation is still being wound up, or has been wound up); and
(c) the Court is satisfied that the Commonwealth is unlikely to receive more than a minimal return on the advance; and
(d) either of the following occurred during the 7-year period mentioned in paragraph (a):
(i) the corporation contravened this Act or the Corporations (Aboriginal and Torres Strait Islander) Act 2006 while the person was an officer of the corporation, and the person failed to take reasonable steps to prevent the contravention;
(ii) the person contravened this Act or the Corporations (Aboriginal and Torres Strait Islander) Act 2006 while the person was an officer of the corporation.
For the purposes of paragraphs (2)(b) and (c), the Commonwealth has received a minimal return on an advance under the Fair Entitlements Guarantee Act 2012 if the amount of the advance recovered by the Commonwealth is 10 cents in the dollar or less.
Note: For recovery of advances paid under the Fair Entitlements Guarantee Act 2012 , see Part 5 of that Act.
In determining whether the disqualification is justified, the Court may have regard to:
(a) the person ' s conduct in relation to the management, business or property of any corporation; and
(b) any other matters that the Court considers appropriate. 206EAB(5)
To avoid doubt, the references in paragraph (1)(a) and subsections (2) and (4) to a corporation include references to an Aboriginal and Torres Strait Islander corporation.
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