ATO cracks down on popular Oporto restaurant, forces shutdown
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In a recent turn of events that has left Sydney foodies in shock, the Australian Taxation Office (ATO) has taken decisive action against a beloved Oporto restaurant, leading to its unfortunate collapse.
The ATO's stringent measures come as a stark reminder of the financial responsibilities businesses hold and the consequences of failing to meet them.
Two companies, Jevnt Pty Ltd and Pymz Pty Ltd, which operated Oporto franchises in Newtown and Darling Harbour, respectively, were plunged into liquidation after the ATO issued a notice to their director, Ming Zhong, demanding the payment of back taxes.
The businesses owed a combined amount of approximately $400,000 - $500,000 to the ATO.
Henry McKenna, the liquidator from Vincents, revealed that Mr Zhong had previously been issued with a director penalty notice by the ATO.
This notice gave the companies a 21-day window to either pay the debt or surrender into liquidation.
Failure to comply with either of these options would have made Mr Zhong personally liable for the tax debt.
The fallout from this financial debacle was immediate.
Oporto Newtown, located in Sydney’s Inner West, did not open its doors on the day of the liquidation and has remained closed since.
The Darling Harbour location had already been closed for over a year due to its location in the Harbourside Shopping Centre, which shut down for redevelopment in January 2023.
The closure of the Newtown store affected around 20 casual or part-time staff.
According to Mr McKenna, it appears that the businesses did not have any other significant debts to supplier creditors.
However, it is possible that the staff and the landlord of the Newtown site may be owed a small amount of money.
Despite the grim circumstances, there is a glimmer of hope for the Newtown restaurant.
'I’m talking with the franchisor about them coming in and reopening the Newtown store—either they’ll run it themselves or find another franchisee to run it,' he said.
However, any such arrangement would be subject to the agreement of the site’s landlord.
The tax debt accumulated by the businesses was largely due to the challenging trading conditions created by the COVID-19 pandemic, coupled with increased input costs.
Oporto, a fast-food chain specialising in Portuguese-style chicken, was founded in 1986 by António Cerqueira, an Australian of Portuguese descent, in Bondi, NSW.
Oporto Franchising is owned by Craveable Brands, which also owns Red Rooster, Chicken Treat, and Chargrill Charlie’s.
Currently, there are more than 190 Oportos trading around Australia.
The closure of Oporto follows the recent shutdown of a popular cafe, Cornersmith, also in Sydney’s Inner West.
The owner cited the Australian hospitality industry as 'a bit broken' due to the difficulty of making a profit.
New figures showed that the number of food and beverage services in external administration is now above pre-COVID-19 levels after a steady increase for most of 2023.
Celebrity chef Jamie Oliver’s restaurant was no exception, as his last branch in Australia recently faced the same fate.
After its four-year run, Jamie Oliver’s Pizzeria at the Pacific Fair went into voluntary administration in August 2023, accumulating a grand total of $1 million in debt.
Matt Heanen, the Director of the Hallmark Hospitality Group, which managed the restaurant, reported to administrators that there was only $7,336 left in the bank.
Rent for the restaurant was one of the debts it incurred ($91,000). It also reportedly owed other parties a whopping $915,000.
You can read more about this here.
What are your thoughts on this story, members? Have you been affected by the closure of a favourite restaurant or cafe? Share your thoughts and experiences in the comments below.
The ATO's stringent measures come as a stark reminder of the financial responsibilities businesses hold and the consequences of failing to meet them.
Two companies, Jevnt Pty Ltd and Pymz Pty Ltd, which operated Oporto franchises in Newtown and Darling Harbour, respectively, were plunged into liquidation after the ATO issued a notice to their director, Ming Zhong, demanding the payment of back taxes.
The businesses owed a combined amount of approximately $400,000 - $500,000 to the ATO.
Two branches of Oporto have been affected by a recent ATO crackdown. Image source: LinkedIn/Oporto.
Henry McKenna, the liquidator from Vincents, revealed that Mr Zhong had previously been issued with a director penalty notice by the ATO.
This notice gave the companies a 21-day window to either pay the debt or surrender into liquidation.
Failure to comply with either of these options would have made Mr Zhong personally liable for the tax debt.
The fallout from this financial debacle was immediate.
Oporto Newtown, located in Sydney’s Inner West, did not open its doors on the day of the liquidation and has remained closed since.
The Darling Harbour location had already been closed for over a year due to its location in the Harbourside Shopping Centre, which shut down for redevelopment in January 2023.
The closure of the Newtown store affected around 20 casual or part-time staff.
According to Mr McKenna, it appears that the businesses did not have any other significant debts to supplier creditors.
However, it is possible that the staff and the landlord of the Newtown site may be owed a small amount of money.
Despite the grim circumstances, there is a glimmer of hope for the Newtown restaurant.
'I’m talking with the franchisor about them coming in and reopening the Newtown store—either they’ll run it themselves or find another franchisee to run it,' he said.
However, any such arrangement would be subject to the agreement of the site’s landlord.
The tax debt accumulated by the businesses was largely due to the challenging trading conditions created by the COVID-19 pandemic, coupled with increased input costs.
Oporto, a fast-food chain specialising in Portuguese-style chicken, was founded in 1986 by António Cerqueira, an Australian of Portuguese descent, in Bondi, NSW.
Oporto Franchising is owned by Craveable Brands, which also owns Red Rooster, Chicken Treat, and Chargrill Charlie’s.
Currently, there are more than 190 Oportos trading around Australia.
The closure of Oporto follows the recent shutdown of a popular cafe, Cornersmith, also in Sydney’s Inner West.
The owner cited the Australian hospitality industry as 'a bit broken' due to the difficulty of making a profit.
New figures showed that the number of food and beverage services in external administration is now above pre-COVID-19 levels after a steady increase for most of 2023.
Celebrity chef Jamie Oliver’s restaurant was no exception, as his last branch in Australia recently faced the same fate.
After its four-year run, Jamie Oliver’s Pizzeria at the Pacific Fair went into voluntary administration in August 2023, accumulating a grand total of $1 million in debt.
Matt Heanen, the Director of the Hallmark Hospitality Group, which managed the restaurant, reported to administrators that there was only $7,336 left in the bank.
Rent for the restaurant was one of the debts it incurred ($91,000). It also reportedly owed other parties a whopping $915,000.
You can read more about this here.
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