Quick guide: 10 steps to Safe Harbour
30 May 2019
The Safe Harbour legislation can protect directors of companies that are experiencing financial difficulty who, acting in good faith, attempt to turn around the company’s financial position. Learn more about the Safe Harbour provisions here.
Here are 10 steps to assist with complying with the Safe Harbour legislation:
1. Seek professional advice early from an appropriately qualified advisor
2. Ensure employee entitlements are paid as they fall due
3. Ensure the company has maintained adequate books and records
4. Acting honestly and in good faith, develop a course of action that is likely to lead to a better outcome for the company than an immediate winding up or administration
5. Take prompt and proactive action to implement the course of action
6. Take steps to prevent misconduct by officers or employees
7. Comply with taxation reporting requirements
8. Keep informed about the company’s financial position
9. Continually monitor the course of action developed and make adjustments as required to ensure it continues to be “reasonably likely” that the course of action will provide a better outcome
10. Ensure debts being incurred are in connection with the course of action being implemented
Seeking early advice is crucial to ensuring the safe harbor criteria is satisfied. Our team are experienced turnaround and insolvency advisors with a focus on the best outcomes for all stakeholders of a company in financial difficulty.