Document ID: chunk:federal_register_of_legislation:C2025C00185:section:7
Version: federal_register_of_legislation:C2025C00185
Segment Type: section
Provision Reference: s 7
Character Range: 2036631–2038439

7                        entering into an uncommercial transaction (within the meaning of section 588FB) other than one that a court orders, or a prescribed agency directs, the company to enter into           when the transaction is entered into

 (2) By failing to prevent the company from incurring the debt, the person contravenes this section if:
 (a) the person is aware at that time that there are such grounds for so suspecting; or
 (b) a reasonable person in a like position in a company in the company's circumstances would be so aware.
Note: This subsection is a civil penalty provision (see section 1317E).
 (3) A person commits an offence if:
 (a) a company incurs a debt at a particular time; and
 (aa) at that time, a person is a director of the company; and
 (b) the company is insolvent at that time, or becomes insolvent by incurring that debt, or by incurring at that time debts including that debt; and
 (c) the person suspected at the time when the company incurred the debt that the company was insolvent or would become insolvent as a result of incurring that debt or other debts (as in paragraph (1)(b)); and
 (d) the person's failure to prevent the company incurring the debt was dishonest.
 (3A) For the purposes of an offence based on subsection (3), absolute liability applies to paragraph (3)(a).
Note: For absolute liability, see section 6.2 of the Criminal Code.
 (3B) For the purposes of an offence based on subsection (3), strict liability applies to paragraphs (3)(aa) and (b).
Note: For strict liability, see section 6.1 of the Criminal Code.
 (4) The provisions of Division 4 of this Part are additional to, and do not derogate from, Part 9.4B as it applies in relation to a contravention of this section.

Subdivision B—Duties to prevent creditor‑defeating dispositions