New legislation to combat illegal phoenixing welcomed

The Australian Small Business and Family Enterprise Ombudsman, Kate Carnell, has welcomed newly introduced legislation to implement Director Identification Numbers (DIN) and modernise business registers.

If passed, the legislation will require Australian company directors to have a unique identification number.

Carnell said the legislation will help combat illegal phoenixing, a process where directors inappropriately take assets out of a business before liquidating, leaving staff, small businesses and suppliers in the lurch.

“Illegal phoenixing not only hurts small business, it costs the economy as much as $3 billion per year,” Carnell said. “The DIN will allow regulators to detect and track rogue company directors to ensure they cannot engage in multiple instances of phoenixing.

The ASBFEO is optimistic that the legislation is a definite step in the right direction, so that small businesses get a fair go.

The Ombudsman also aired her support for the move to create a new central business registry regime, which will simplify the process for small and family businesses.

“At the end of the day, any measure that reduces red tape is good news for small and family businesses because it allows them to get on with the job of growing their business,” Carnell said.

No comments | be the first to comment

Comment Manually

Read more


FREE NEWS BRIEFS Get breaking news delivered