Civil penalties for officers of corporations failing to prevent contraventions
103 Civil penalties for officers of corporations failing to prevent contraventions
An officer of a corporation is liable to a civil penalty if:
the corporation contravenes a civil penalty provision of this Act; and
the officer knew that, or was reckless or negligent as to whether, the contravention would occur; and
the officer was in a position to influence the conduct of the corporation in relation to the contravention; and
the officer failed to take all reasonable steps to prevent the contravention.
The officer was reckless as to whether the contravention would occur if:
the officer was aware of a substantial risk that the contravention would occur; and
having regard to the circumstances known to the officer, it was unjustifiable to take the risk.
The officer was negligent as to whether the contravention would occur if the officer’s conduct involved:
such a great falling short of the standard of care that a reasonable person would exercise in the circumstances; and
such a high risk that the contravention would occur;
that the conduct merits the imposition of a pecuniary penalty.
Reasonable steps to prevent contravention
Without limiting this section, in determining whether an officer of a corporation failed to take all reasonable steps to prevent a contravention, a court may have regard to all relevant matters, including:
what action (if any) the officer took directed towards ensuring the following (to the extent that the action is relevant to the contravention):
that the corporation arranges regular professional assessments of the corporation’s compliance with civil penalty provisions;
that the corporation implements any appropriate recommendations arising from such an assessment;
that the corporation’s employees, agents and contractors have a reasonable knowledge and understanding of the requirements to comply with civil penalty provisions in so far as those requirements affect the employees, agents or contractors concerned; and
what action (if any) the officer took when he or she became aware of the contravention.
Maximum penalty
The maximum penalty for the contravention of subsection (1) is the maximum penalty that would apply if the officer had contravened the civil penalty provision mentioned in paragraph (1)(a).
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