While ASIC reports its success in having a former company director convicted for trying to deregister his building company without disclosing it had a large debt owing, many companies are deregistered without the directors saying anything all.
ASIC reports that a former company director has been convicted for trying to deregister his building company without disclosing it had a debt owing of around $35,000: https://www.asic.gov.au/about-asic/news-centre/find-a-media-release/2025-releases/25-244mr-queensland-director-sentenced-for-making-a-false-or-misleading-statement-to-asic/
An ASIC investigation had found that he had lodged a “Form 6010” with ASIC to voluntarily deregister his building company in December 2023, but the form contained a false or misleading declaration that the company had no outstanding liabilities: see s 601AA(1) Corporations Act. The company in fact owed $34,885 to the Queensland Building and Construction Commission.
The former director was fined $1,000 and automatically disqualified from managing corporations for five years.
The 2023 PJC inquiry into corporate insolvency heard that many companies are deregistered by default, without any form being lodged with ASIC, creditors or not.
Abandonment without liquidation is said to be likely to happen in small companies “where the creditors are unwilling to spend money on a liquidator to chase possibly non-existent corporate assets”. Such companies may often be phoenixed: see “Illegal Phoenix Activity: Practical Ways to Improve the Recovery of Tax” (2018) 40(2) Sydney Law Review 255, Helen Anderson.
The connection between deregistered companies and illegal phoenix activity was raised as early as 1995, when ASIC’s predecessor estimated that over 90% of phoenix companies at the time were being deregistered by default “[e]ffectively … assisting Phoenix offenders to escape prosecution … and closing off the trail’”: see https://murrayslegal.com.au/blog/2023/07/19/looking-more-at-deregistered-companies/
In response to that and other concerns, the PJC recommended in 2023 that ASIC
“collect and analyse data from an appropriately sized sample of voluntary and compulsory deregistrations, to provide greater visibility of the solvency status of deregistered companies”.
That information will be interesting, when it is extracted.
