A new year – a reminder of the powers of section 1322 of the Corporations Act

On 28 January 2026, the Federal Court of Australia delivered a judgment in Re IG Power Holdings Ltd [2025] FCA 1690 granting relief to several entities regarding their statutory financial reporting obligations. The companies had faced difficulties meeting their reporting deadlines due to a prolonged period of administration and associated record-keeping challenges. The administration, which began in March 2023 and concluded in May 2025, left the companies immediately non-compliant with their reporting obligations upon exit. 

The Court granted the requested orders pursuant to section 1322 of the Corporations Act 2001 (Cth) to extend the deadlines for lodging financial and directors’ reports and relieving directors and company secretaries from civil liability for failures to lodge reports on time for the affected years, provided the reports are lodged by the new deadlines.

This judgment underscores the Court’s willingness to grant remedial relief under section 1322 where reporting failures arise from circumstances beyond the control of current management, particularly following complex administrations. The decision provides reassurance that, where directors act honestly and promptly to address inherited compliance issues, the risk of personal liability can be mitigated. It also highlights the importance of transparency with regulators and the value of seeking timely judicial intervention when compliance challenges arise. 

Key Considerations: Honest Conduct and Absence of Prejudice

The Court’s decision turned on two main factors:

1. Honest Conduct: The officers responsible for the companies after administration were found to have acted honestly. They did not cause the original non-compliance, took prompt steps to rectify the situation, self-reported the breaches to ASIC, and engaged auditors and accountants to prepare the outstanding reports. 
2.  No Substantial Injustice: The Court found no evidence that granting the relief would cause substantial injustice to shareholders, creditors, or other stakeholders. The companies were solvent, and the sole shareholder did not object to the relief. Additionally, the financial services entity had not engaged in regulated activity during the period of non-compliance and would not do so until reporting obligations were met.

Takeaways for Companies Emerging from Administration

• Prompt Action is Critical: Directors should act quickly to identify and address any inherited compliance failures.
• Transparency with Regulators: Self-reporting and cooperation with ASIC are viewed favorably by the Court.
• Judicial Relief is Available: The Corporations Act provides mechanisms for relief from both deadlines and liability, but companies must demonstrate honest conduct and the absence of prejudice to stakeholders.