Document ID: chunk:federal_register_of_legislation:C2025C00185:section:588e:p1
Version: federal_register_of_legislation:C2025C00185
Segment Type: section
Provision Reference: s 588E (pt 1/3)
Character Range: 1971169–1973912

588E  Presumptions to be made in recovery proceedings
 (1) In this section:
recovery proceeding, in relation to a company, means:
 (a) an application under section 588FF by the company's liquidator; or
 (aa) action by ASIC under section 588FGAA; or
 (ab) proceedings under section 588FGAE; or
 (b) proceedings begun under subsection 588FH(2) by the company's liquidator; or
 (c) proceedings, in so far as they relate to the question whether a security interest created by the company is void to any extent, as against the company's liquidator, because of subsection 588FJ(2); or
 (d) proceedings begun under subsection 588FJ(6) by the company's liquidator; or
 (e) proceedings for a contravention of subsection 588G(2) in relation to the incurring of a debt by the company (including proceedings under section 588M in relation to the incurring of the debt but not including proceedings for an offence); or
 (ea) proceedings for a contravention of subsection 588GAB(2) or 588GAC(2) in relation to a disposition of property of the company (including proceedings under section 588M in relation to the disposition but not including proceedings for an offence); or
 (f) proceedings under section 588W in relation to the incurring of a debt by the company.
 (2) Subsections (3) to (9), inclusive, have effect for the purposes of a recovery proceeding in relation to a company.
 (3) If:
 (a) the company is being wound up; and
 (b) it is proved, or because of subsection (4) or (8) it must be presumed, that the company was insolvent at a particular time during the 12 months ending on the relation‑back day;
it must be presumed that the company was insolvent throughout the period beginning at that time and ending on that day.
 (4) Subject to subsections (5) to (7), if it is proved that the company:
 (a) has failed to keep financial records in relation to a period as required by subsection 286(1); or
 (b) has failed to retain financial records in relation to a period for the 7 years required by subsection 286(2);
the company is to be presumed to have been insolvent throughout the period.
 (4A) In determining for the purposes of the recovery proceeding whether a disposition of property of the company is a creditor‑defeating disposition, the consideration payable to the company for the disposition is to be presumed to be less than both the market value of the property and the best price reasonably obtainable for the property, if it is proved that the company:
 (a) has failed to keep financial records relating to the disposition as required by subsection 286(1); or
 (b) has failed to retain financial records relating to the disposition for 7 years after the disposition as required by subsection 286(2).
This subsection is subject to