19 October 2020
- Take steps to minimise the adverse impact of the collapse or closure of other small businesses (small and medium enterprises (SMEs)).
- What to do if you are owed money 鈥� steps to debt recovery as a creditor.
- Seek advice from a听trusted business adviser听(such as a financial adviser, accountant, registered liquidator or lawyer)听sooner rather than later.
As many Australian businesses begin to reopen and return to 鈥榖usiness-as-usual鈥�, some businesses continue to deal with and respond to the financial impact of COVID-19.
Some small businesses may be adversely affected and owed money by other businesses, particularly in industries impacted by the COVID-19 shutdown period.
Protect your small business during COVID-19
The instability created by COVID-19 means it鈥檚听more vital than ever to听protect your interests when dealing with other businesses.
To minimise the risk of your small business being adversely affected by the closure of other SMEs, ASIC recommends taking steps听before you听engage with another business:
- Ask the right questions听that will help you to obtain further information.听
- Verify the information they provide (including any licence or authority they hold to operate in certain industries) by checking听听and those of other government agencies.听
- If you are dealing with a business that is a company, you can monitor it using ASIC鈥檚听Company Alert service.
- Review terms of trade you are prepared to offer and your loan and credit contracts.
- Be听aware of the common scams targeting small businesses with听.听
If you already engage with another business and require assistance because you are owed money, we recommend:听
- Seeking business advice from advisers you trust. Information about how to find a suitable adviser is available from听听and ASIC鈥檚听听or a听registered liquidator.
- ASIC鈥檚听insolvency information sheet for creditors听if you鈥檙e affected by another business鈥� insolvency.
- Understanding your rights when engaging in debt recovery. See ASIC鈥檚 advice on听debt recovery for small business听and information about听illegal phoenix activity.
- If necessary, managing and resolving business disputes with help from the听.
Additional information
- , including advice on how a Personal Property听Securities Register (PPSR)听registration can help you get your invoices paid and听the steps you need to take to get your goods, or their value, back if your customer has gone broke
ASIC is Australia鈥檚 corporate, markets and financial services regulator.
This article was originally published on 22 June 2020 with the heading "COVID-19: steps to protect your small business".