ARITA achieves new protection for RLs against CoRA provisions
ARITA has achieved major concessions from the Queensland Government under its controversial Chain of Responsibility legislation (CoRA). This has national implications as other state governments have been closely watching these developments.
New guidance issued on Friday – which substantially reduces the exposure of Registered Liquidators (RLs) to CoRA – came about due to the extensive work of ARITA’s Legal Director Mark Wellard and Tim Michael (Ferrier Hodgson) from ARITA’s Queensland Committee.
In short, the guideline limits the risk of an RL being lumbered with a CoRA EPO for pre-existing issues. RLs will only incur a risk of an EPO if they cause, or fail to take reasonable action to address, an issue after they've been appointed. These new CoRA EPOs could have left RLs with a personal liability of hundreds of millions of dollars.
We had made it clear to the Queensland Government that a failure to address the shortcomings in CoRA would lead to us advising practitioners to immediately shut down any site that could create a CoRA exposure for them, including terminating all employees, rather than attempt to trade-on, due to the personal liability risks.
Mark Wellard, in particular, worked very closely with all the organisations on the working party (ABA, AICD, Queensland Resources Council and others) and a number of key practitioners in the resources space in Queensland, including Tim Michael, to achieve a more balanced and workable CoRA.
A comprehensive briefing note is now available for members.
A special thanks to Tim Michael and ARITA’s President, Mike McCann, for their support and work on this process.