Australia
Australian law establishes a system of voluntary administration, whereby administrators are appointed by a resolution of the board of the relevant company. The Board may appoint an administrator in circumstances where the company is, or will become at some future time, insolvent. In certain circumstances, a liquidator or receiver of an insolvent company may elect to appoint an administrator. Once appointed, the administrator must prepare a report containing recommendations as to whether the company should be returned to the control of the directors, wound up or execute a deed of company arrangement.
Administrators are required to be registered liquidators, and by virtue of their appointment have broad powers to deal with company property. The appointment of an administrator "freezes" any legal proceedings (on foot or anticipated) against the company, and control of the company is given entirely to the administrator. Directors of the company are prohibited from acting in their capacity as directors for the duration of the administration.
While administrators are personally liable for any debts incurred by the company in the course of the administration, they are granted a statutory indemnity against these debts.
The Australian insolvency regime, encompassing administrations, liquidations and receiverships, is the subject of ongoing discussion in respect of law reform.
Read more about this topic: Administration (law)
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