Fashion designer Lisa Ho’s purchase of the intellectual property rights of the collapsed Lisa Ho brand have raised alarm bells with the Australian Taxation Office.
Australian Securities and Investments Commission notes from a Lisa Ho Designs creditors’ meeting held in late July show ATO representative Thilaga Prabhakharan was worried the arrangement was a “phoenix” move, Fairfax stated.
The concern centred on the sale of the Lisa Ho Designs intellectual property assets to Lisa Ho IP Holdings, a new company created by the designer.
A “phoenix” business is known as a company that has been created following the collapse of another, and conducts similar commercial activities.
The administrator for the fashion brand, Todd Gammel of HLB Mann Judd, told SmartCompany last month that Lisa Ho had purchased the intellectual property rights to the name and also the archive of historical designs. He could not speculate on what Ho would do with the intellectual property rights, stating that was “her decision”.
This morning, Gammel reiterated to SmartCompany that the sale of IP to Lisa Ho was the best offer available and that “in reality other offers were poor”.
He says that phoenix businesses is “one of the hot topics at the moment”.
“They are difficult to identify…that is why they are not in legislation”, he says.
Gammel says he understands why the ATO raised the topic, as they want to ensure everything is done cleanly.
At the creditors’ meeting, he says he explained to the ATO the circumstances of the deal, and believes that they were satisfied with the arrangement. He says only proof of debt remains as an ongoing association with the ATO.
The Lisa Ho fashion business went into administration in May this year, with around 100 staff put out of work. At the time, SmartCompany was informed by administrators it had a debt of around $11 million.
The Lisa Ho retail stores closed on July 7, followed by a final warehouse sale of unsold apparel.
Lisa Ho eyewear intellectual property was sold to luxury eyewear producer and distributor Face Optics on June 28.