Glen Norris, The Courier-Mail April 1, 2019 8:09pm Subscriber only
A CHINESE construction giant being chased for $40 million after the collapse of a Queensland building venture had earlier agreed to pay up to $1 billion to creditors if the business went bust.
The Federal Court heard yesterday that China Railway Construction Group (CRCG) had signed a deed with the Queensland Building and Construction Commission (QBCC) in 2016 that ensured full payment up $1.09 billion to subcontractors and other unsecured creditors if a joint venture, CRCG-Rimfire, was liquidated.
However, the court was told by lawyers acting for CRCG-Rimfire’s creditors that CRCG doesn’t now intend to abide by the deed even if there is a court judgment against it.
The case reflects growing concern about the business practices of Chinese state-owned companies investing in overseas markets.
CRCG-Rimfire, which had been involved in a number of high rise unit projects in Brisbane, is now in a form of corporate limbo meaning it has not been liquidated but continues to exist under a deed of company arrangement (DOCA) implemented last year.