Commonwealth: Corporations Amendment (Insolvency) Act 2007 (Cth)

Corporations Amendment (Insolvency) Act 2007 No. 132, 2007 An Act to amend the Corporations Act 2001, and for other purposes Contents 1 Short title 2 Commencement 3 Schedule(s) Schedule 1—Improving outcomes for creditors Part 1—Enhancing protection of employee entitlements Corporations Act 2001 Superannuation Guarantee (Administration) Act 1992 Part 2—Better informing creditor decisions Corporations Act 2001 Part 3—Streamlining external administration Corporations Act 2001 Part 4—Facilitating pooling in external administration Corporations Act 2001 Schedule 2—Deterring corporate misconduct Australian Securities and Investments Commission Act 2001 Corporations Act 2001 Schedule 3—Improving regulation of insolvency practitioners Corporations Act 2001 Schedule 4—Fine‑tuning voluntary administration Part 1—General Corporations Act 2001 Part 2—Rights to property during administration Corporations Act 2001 Part 3—Liquidation following administration Corporations Act 2001 Schedule 5—Miscellaneous Australian Securities and Investments Commission Act 2001 Corporations Act 2001 Schedule 6—Transitional Corporations Act 2001 Corporations Amendment (Insolvency) Act 2007 No. 132, 2007 An Act to amend the Corporations Act 2001, and for other purposes [Assented to 20 August 2007] The Parliament of Australia enacts: 1 Short title This Act may be cited as the Corporations Amendment (Insolvency) Act 2007. 2 Commencement (1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms. Commencement information Column 1 Column 2 Column 3 Provision(s) Commencement Date/Details 1. Sections 1 to 3 and anything in this Act not elsewhere covered by this table The day on which this Act receives the Royal Assent. 20 August 2007 2. Schedule 1, items 1 to 48 A single day to be fixed by Proclamation. 31 December 2007 However, if any of the provision(s) do not commence within the period of 6 months beginning on the day on which this Act receives the Royal Assent, they commence on the first day after the end of that period. (see F2007L03798) 3. Schedule 1, items 49 and 50 On the first day after the end of the period of 6 months beginning on the day on which the provision(s) covered by table item 2 commence. 1 July 2008 4. Schedule 1, items 51 to 120 At the same time as the provision(s) covered by table item 2. 31 December 2007 5. Schedule 1, item 121 At the same time as the provision(s) covered by table item 3. 1 July 2008 6. Schedule 1, items 122 to 133 At the same time as the provision(s) covered by table item 2. 31 December 2007 7. Schedule 2, items 1 to 10 At the same time as the provision(s) covered by table item 2. 31 December 2007 8. Schedule 2, item 11 At the same time as the provision(s) covered by table item 3. 1 July 2008 9. Schedule 2, item 12 At the same time as the provision(s) covered by table item 2. 31 December 2007 10. Schedules 3 to 6 At the same time as the provision(s) covered by table item 2. 31 December 2007 Note: This table relates only to the provisions of this Act as originally passed by both Houses of the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent. (2) Column 3 of the table contains additional information that is not part of this Act. Information in this column may be added to or edited in any published version of this Act. 3 Schedule(s) Each Act that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms. 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 se