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Companies Act 1993

Offences and penalties

386F: Exception in relation to non-dormant phoenix company known by pre-liquidation name of failed company for at least 12 months before liquidation

You could also call this:

“Exception for active companies using a similar name before another company's failure”

You can use a company’s name that’s the same or similar to a failed company’s name if certain conditions are met. This is allowed even if the failed company has gone into liquidation. For this to be okay, your company must have been using the name for at least 12 months before the failed company went into liquidation. Also, your company must have been active during those 12 months.

Being active means your company has been doing business. You need to have records of transactions in your company’s accounts throughout the 12-month period. These are the transactions that the law says you must record.

This exception applies even if there are rules that usually stop people from using names of failed companies. It’s a way to protect companies that have been using a name for a long time, even if a similar company later goes out of business.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM323268.

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Part 21 Offences and penalties

386FException in relation to non-dormant phoenix company known by pre-liquidation name of failed company for at least 12 months before liquidation

  1. The prohibitions in section 386A(1)(a) and (b) do not apply in respect of a phoenix company that has been known by a name or names that are the same as the failed company's pre-liquidation name or are similar names if—

  2. it has been known by that name or those names for not less than the period of 12 months before liquidation commences; and
    1. it has not been dormant during those 12 months.

      1. For the purposes of subsection (1), a company has not been dormant during the 12-month period if transactions that are required by section 194(1) to be recorded in its accounting records have occurred throughout that period.

      Compare
      • Insolvency Rules 1986 rule 4.230 (UK)
      Notes
      • Section 386F: inserted, on , by section 35 of the Companies Amendment Act 2006 (2006 No 56).
      • Section 386F(2): amended, on , by section 41 of the Financial Reporting (Amendments to Other Enactments) Act 2013 (2013 No 102).