Clive Palmer nephew in Senate picture

The corporate watchdog’s legal pursuit of Clive Palmer could mean a Senate vacancy to be filled by the magnate’s nephew.

United Australia Party leader Clive Palmer with his nephew Martin Brewster. Picture: Shae Beplate

The corporate watchdog will ­decide whether to pursue Clive Palmer over possible criminal breaches of the law in the next term of parliament, raising the prospect the mining magnate’s nephew could be ushered into a potential Senate ­vacancy if he is forced to step aside.

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Mr Palmer, who is expected to gain enough votes for a Queensland Senate seat to return him to politics four years after the collapse of his previous Palmer United Party, is under investigation by the Australian Securities & Investments Commission over the collapse of his Queensland Nickel company, which went into liquidation in 2016.

The billionaire has already been charged by ASIC with offences that carry a maximum penalty of two years’ jail for allegedly breaching laws amid a proposed takeover of The President’s Club by Palmer Leisure Coolum in 2012, which did not eventuate in the legally ­required two-month timeframe.

A guilty finding could force Mr Palmer out of parliament, which would likely see his nephew — ­Martin Brewster, who holds the second ticket on the United Australia Party Senate list — assume a ­vacancy. Mr Palmer has already taken out advertisements as part of a $50 million election campaign ­declaring he will defend Mr Brewster, a former RAAF squadron leader, who faced attempts to “kick him out of the air force for revealing how the Chinese government control ports and airstrips in Australia”.

Mr Brewster is also a former manager at the billionaire’s Queensland Nickel mine.

A UAP spokesman said the ­matters “don’t have any substance and have been brought on for a political purpose” and “Mr Palmer is eligible to stand for the Senate and will be elected”. He has so far failed to have the Coolum charges thrown out of court, and has ­appealed to the Supreme Court of Queensland in a hearing scheduled for early June.

However, ASIC is also “well progressed” on its probe into the collapse of the former nickel refinery, which went into liquidation owing its 800 workers more than $70 million. According to court documents, other corporate creditors are still chasing more than $141 million and have alleged Mr Palmer was acting as a shadow director of the business and that he breached his obligations under the law.

While ASIC has declined to ­reveal which potential breaches of the law it is investigating, commissioner John Price recently told a Senate estimates hearing that “all options are on the table in respect of this matter” relating to Queensland Nickel. “That potentially includes criminal (charges),” Mr Price said.

ASIC’s current investigations are focused on the Coolum matter, Queensland Nickel and associated Palmer companies.

Under the law, a shadow director is a person not formally registered or appointed as a director, but who acts as a director of a company and instructs senior officers. Shadow directors have the same duties and obligations as registered directors, and thus can face penalties of up to five years in jail for certain breaches of the law, including for acting dishonestly or in bad faith.

Constitutional expert Anne Twomey said members of parliament found guilty of breaching laws that carry sentences of more than 12 months can be disqualified from parliament, even if the court chooses not to pursue the full punishment available to it.