To successfully qualify for Safe Harbour protection, directors and the company must also meet the various qualifying criteria. The most significant of which is that one or more courses of action needs to be reasonably likely to lead to a better outcome for the company (than the appointment of an administrator or liquidator to the company). The interpretation of ‘reasonably likely’ and ‘better outcome’ can be hard to determine and subject to individual opinion.
Furthermore, the Safe Harbour is only open to directors who are acting honestly and diligently and who have taken appropriate steps to ensure the company has:
- paid entitlements of its employees by the time they fall due
- given returns, notices, statements, applications or…