(1) On application by ASIC, the Court may disqualify a person from managing corporations for up to 10 years if:

(a)

within the last 7 years, the person has been an officer of 2 or more corporations when they have failed; and

(b)

the Court is satisfied that:

(i)

the manner in which the corporation was managed was wholly or partly responsible for the corporation failing; and

(ii)

the disqualification is justified.

(2) For the purposes of subsection (1), a corporation fails if:

(a)

a Court orders the corporation to be wound up under section 459B because the Court is satisfied that the corporation is insolvent; or

(b)

the corporation enters into voluntary liquidation and creditors are not fully paid or are unlikely to be fully paid; or

(c)

the corporation executes a deed of company arrangement and creditors are not fully paid or are unlikely to be fully paid; or

(d)

the corporation ceases to carry on business and creditors are not fully paid or are unlikely to be fully paid; or

(e)

a levy of execution against the corporation is not satisfied; or

(f)

a receiver, receiver and manager, or provisional liquidator is appointed in relation to the corporation; or

(g)

the corporation enters into a compromise or arrangement with its creditors under Part 5.1; or

(h)

the corporation is wound up and a liquidator lodges a report under subsection 533(1) about the corporation's inability to pay its debts.

Note: To satisfy paragraph (h), a corporation must begin to be wound up while the person is an officer or within 12 months after the person ceases to be an officer. However, the report under subsection 533(1) may be lodged by the liquidator at a time that is more than 12 months after the person ceases to be an officer. Sections 513A to 513D contain rules about when a company begins to be wound up.

(3) 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.