The Australian Small Business and Family Enterprise Ombudsman, Kate Carnell AO, is recommending a unique identifier that will enable identification of rogue directors to ensure they can’t be involved in multiple instances of ‘phoenixing’.
Phoenixing refers to a commercial entity avoiding creditors by transferring assets before liquidating the company and emerging under a different name.
“Phoenixing hurts small business,” said Carnell. “When companies phoenix it’s usually the subcontractors and small businesses who suffer; they’re the ones who aren’t paid.
“This is a definite step in the right direction to ensure that small businesses get a fair go.
“The challenge for the government is to ensure this is not just another number with more red tape.
“We’ve already got an ACN, ABN, a TFN and many licences and regulatory requirements for businesses.
“We want to see a scenario where all of this data is consolidated into a single portal that contains all relevant information.”