Legal Phoenix

Not all company failures involve illegal phoenix activity, as genuine company failures do occur. Where a director has responsibly managed a company and it subsequently fails, they can operate the same business using another company without engaging in illegal phoenix activity.  This is often referred to as a ‘company restructure’. A responsibly managed company means the director has complied with their legal obligations and acted in the best interest of the company and its creditors. When a company restructure involves transferring assets to a new company, acting responsibly could mean having the assets independently valued to determine their true market value and the new company pays that value. Where a company is a small business, directors may enter into a restructuring by appointing a restructuring practitioner.  Read more here.