Queensland Consolidated Acts Queensland Consolidated Acts(1) This section applies if--
(a) a corporatised corporation's board suspects that the corporation or, for an LGOC, its subsidiary is, may be, will or may become insolvent; and
(b) in the board's opinion, compliance with a direction given by the shareholder is not or would not be the cause or a substantial cause of the suspected insolvency.
(2) The board must immediately give written notice to the corporation's shareholder and the auditor-general and, if the corporation is a subsidiary, to its local government of--
(a) the suspicion; and
(b) its reasons for the opinion.
(3) The notice must state that it is given under this section.
(4) If the shareholder is satisfied that the board's suspicion is well-founded, the shareholder must immediately give the board the written directions that the shareholder considers necessary or desirable, including any directions necessary or desirable to ensure--
(a) the corporation or subsidiary does not incur further debts; or
(b) the corporation or subsidiary will be able to pay all its debts as and when they become due.
(5) Without limiting subsection (4), a direction under this section may require the corporation or, for an LGOC, any of its subsidiaries, to cease or limit particular activities.
(6) If the shareholder is a local government, a direction under subsection (4) must be by resolution of the local government.
(7) The board must ensure a direction under this section is complied with by the corporation.
(8) If the direction to an LGOC's board concerns the LGOC's subsidiary, the LGOC's board must, to the extent the direction concerns the subsidiary--
(a) notify the subsidiary of the direction; and
(b) ensure the direction is complied with by the subsidiary.
(9) The subsidiary's board must ensure that a direction of which it has been notified is complied with in relation to the subsidiary to the extent that the direction concerns the subsidiary.
(10) A copy of the direction by a local government must be open to inspection.
(11) This section is in addition to, and does not limit, another provision of this part or another law.
(13) The shareholder must give the auditor-general a copy of every advice or direction given under this section to the board.