April 2008
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In this edition:
Note: All hyperlinks below were correct at the time of publication. Generally, it is too onerous a task for us to check and update these and so if a hyperlink is no longer valid, please accept our apologies.
The Government is proposing to amend section 46 of the Trade Practices Act 1974 (Cth) to improve how it operates in relation to anti-competitive behaviour. An exposure draft of the proposed amendments can be downloaded from:
The Government has also released for public consultation a revised Trade Practices Amendment (Component Pricing and Other Measures) Bill 2008, which would require corporations to specify, in a prominent way, a single price for goods and services. An exposure draft of the Bill can be downloaded from:
http://www.treasury.gov.au/documents/1356/PDF/Draft_TPA_Amendment_Bill_Component_Pricing.pdf
ACCC has had a big month on the enforcement front. It has successfully taken action in relation to the use of false testimonials in advertisements; misleading claims about the profitability and customer numbers of a licensing scheme; misleading claims about the profitability and demand for certain franchised business opportunities; misleading product packaging implying that a yoghurt product contained real fruit pieces when the pieces were made of fruit concentrate, sugar and semolina; misleading "was/now" pricing of jewellery; an employment agency misleading jobseekers about the availability of work; misleading product packaging about the filling used in biscuits; and false claims that certain portable air conditioners were environmentally friendly and contain non-harmful gases. See respectively Media Releases 087/08, 089/08, 090/08, 093/08, 098/08, 101/08, 108/08 and 112/08:
http://www.accc.gov.au/content/index.phtml/itemId/814590
http://www.accc.gov.au/content/index.phtml/itemId/814807
http://www.accc.gov.au/content/index.phtml/itemId/814831
http://www.accc.gov.au/content/index.phtml/itemId/820182
http://www.accc.gov.au/content/index.phtml/itemId/822863
http://www.accc.gov.au/content/index.phtml/itemId/823311
http://www.accc.gov.au/content/index.phtml/itemId/825714
http://www.accc.gov.au/content/index.phtml/itemId/825883
APRA has released a package that sets out its draft prudential framework for supervision of general insurance groups. The package consists of three draft prudential standards and a discussion paper that responds to submissions received following two previous consultation rounds in 2006 and 2007. The package also responds to recommendations 38 and 39 of the HIH Royal Commission. The package of draft standards and discussion paper can be found on the APRA website at:
http://www.apra.gov.au/General/Proposals-relating-to-GI.cfm.
APRA has also released revisions to its proposed general insurance refinements package following industry consultation. A document summarising the revisions can be downloaded from:
http://www.apra.gov.au/General/upload/Amended-Refinements-to-GI-prudential-framework-2-4-08.pdf
APRA and ASIC have reminding direct offshore foreign insurers and local insurance brokers about the new authorisation requirements for foreign insurers that come into effect on 1 July 2008. See media release 08.07:
http://www.apra.gov.au/media-releases/08_07.cfm
ASIC has released a consultation paper Facilitating online financial services disclosures concerning the relief it proposed to provide to financial services licensees so that they can give information to clients by referring them to a website or by emailing a hyperlink. In particular, superannuation fund annual reports will be able to be provided on a website unless the client opts out. The consultation paper is available at:
ASIC has delivered 3 further instalments on its commitment to require better disclosure to retail investors who invest in unlisted and unrated debentures. The first is Report 127: Debentures – Improving disclosure for retail investors, which presents the findings of a review into disclosures made by each of the unlisted, unrated debenture issuers against the new disclosure regime. The second is a new publication, Investing in debentures? Independent guide for investors reading a prospectus for unlisted debentures, designed to provide further explanation of the new benchmarks. And the third is a report on research it commissioned to better understand the profile and motivations of investors in unlisted and unrated debentures, entitled Understanding investors in the unlisted unrated debenture market. They can be downloaded from:
http://www.asic.gov.au/asic/pdflib.nsf/LookupByFileName/REP_127.pdf/$file/REP_127.pdf
http://www.fido.gov.au/fido/fido.nsf/byHeadline/Unlisted%20unrated%20debentures
http://www.asic.gov.au/asic/pdflib.nsf/LookupByFileName/REP_126.pdf/$file/REP_126.pdf
ASIC has launched a new updated training register to improve the way individuals in the financial services industry can search and obtain information about approved courses and course providers. The updated Register can be accessed at:
http://www.asic.gov.au/eTraining/eTrain.nsf
Another win for ASIC on continuous disclosure. Listed mineral exploration company, Sub-Sahara Resources NL, has paid a $33,000 fine following an ASIC investigation into allegations that it failed to properly inform the market about metallurgical test results for a gold project. See media release 08-87:
ASIC has released the findings of research relating to Australian consumers’ understanding of investments and their levels of financial literacy. The report Australian investors: at a glance can be downloaded from:
ASIC has released a report outlining its recent decisions on applications for relief from the corporate finance, financial services and managed investment provisions of the Corporations Act between 1 September and 30 November 2007. It can be viewed at:
ASX is undertaking a consultation process with ACH Clearing Participants to obtain information on the likely impact of clearing multiple trade execution platforms for ASX-listed securities. See ASX Circular 171/08 and attachment:
AUSTRAC has launched a Public Legal Interpretation Series to help reporting entities better understand their obligations under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006. It can be accessed at:
http://www.austrac.gov.au/pli.html
Austrac has released Guidance Note 08/02 on the requirement for reporting entities to designate an AML/CTF Compliance Officer. It can be viewed at:
http://www.austrac.gov.au/files/gn_amlctf_compliance_officers.pdf
SFE full trading participants will be required to undertake a self-certification process concerning their compliance with automated order processing requirements prior to 1 July. See SFE Notice 051/08:
http://www.sfe.com.au/content/notices/2008/notice2008_051.pdf
Corrs Chambers Westgarth, Obtaining Market Value When Exercising the Mortgagee's Power of Sale - 4 April 2008 looks at a recent South Australian Supreme Court decision on the requirement in section 420A(1)(a) of the Corporations Act for a bank to take all reasonable care to sell a property for its market value when exercising the mortgagee’s right to sale. See:
http://www.corrs.com.au/corrs/website/web.nsf/Content/Pub_TGIF_Obtaining_Market_Value_040408
For a general discussion of recent developments in employee relations law, see Allens Arthur Robinson, Focus: Workplace Relations - April 2008:
http://www.aar.com.au/pubs/wr/fowrapr08.htm
The Federal Government has begun its national review into harmonising occupational health and safety laws. See Mallesons, First Step Towards National Occupational Health and Safety Laws - 7 April 2008:
http://www.mallesons.com/publications/2008/Apr/9382521W.htm
For background on the current debate around short selling, see Allens, Focus: Capital Markets - 16 April 2008:
http://www.aar.com.au/pubs/pdf/cm/focmapr08.pdf
Baker & Mckenzie, Limitations on Accountants' Liability in Australia - Implications for Capital Raisings - April 2008 analyses the impact on capital raisings of the 'cover of excellence' schemes and the limitation of liability this affords to ICAA and CPA members. See:
For tips on what to expect and how to manage an AUSTRAC audit, see Baker & Mckenzie, AUSTRAC Audits - Key Takeaways and Tips for Managing - April 2008:
http://www.bakernet.com/NR/rdonlyres/D95784B9-A3BE-4FB7-973E-4DED599F77D9/0/au_audits_ca_apr08.pdf
Allens, Arthur Robinson, Focus: Mergers & Acquisitions - 17 April 2008 examines the ramifications of Takeovers Panel Guidance Note 20 concerning disclosure of equity derivatives. See:
http://www.aar.com.au/pubs/pdf/ma/fomaapr08.pdf
The recent Federal Court judgment in University of Western Australia v Gray (No 20) [2008] FCA 498 has important implications for employers, and in particular universities, who seek to rely on implied terms in contracts of employment to secure ownership of inventions made by employees. It also serves as a warning to universities who seek to protect intellectual property generated by researchers and academics through internal regulation. The case confirms that the only way to effectively acquire intellectual property generated by research or academic employees is by including appropriate provisions in individual employment contracts. See Mallesons Stephen Jaques, IP Generated by Researchers and Academics is not Necessarily Owned by Their Employer - 23 April 2008:
http://www.mallesons.com/publications/2008/Apr/9409443W.htm
The Privacy Commissioner has released issued a draft voluntary Information Security Breach Notification Guide for public comment. The guide has been designed to assist public sector agencies and private sector organisations respond effectively to an information security breach. See Mallesons Stephen Jaques, Voluntary Privacy Breach Reporting - 17 April 2008:
http://www.mallesons.com/publications/2008/Apr/9397811W.htm
For a concise summary of the first Australian case dealing with transfer pricing methodologies, see Deacons, AAT Hands Down Decision in Landmark Transfer Pricing Case - 18 April 2008:
http://www.deacons.com.au/legal-services/taxation/legal-updates/legal-update.cfm?objid=6362
For an outline of stamp duty changes proposed to be enacted in New South Wales, see Minter Ellison, Alert - State Revenue Legislation Amendment Bill 2008: Implications for Stamp Duty and Land Tax - 9 April 2008:
For a summary of the changes proposed by the government to the Trade Practices Act (as outlined in the exposure draft Bills mentioned above), see Mallesons, Proposed Changes to Component Pricing - 2 April 2008 and Bye Bye Birdsville - 28 April 2008:
http://www.mallesons.com/publications/2008/Apr/9375871W.htm
http://www.mallesons.com/publications/2008/Apr/9412854W.htm
Those interested in following how the Opes Prime saga unfolds in the courts should read CMG Equity Investments Pty Ltd v Australia and New Zealand Banking Group Ltd [2008] FCA 455 and Melewar Steel Ventures Limited v ANZ Nominees Limited [2008] NSWSC 295 and [2008] NSWSC 345. They can be downloaded at:
http://cclsr.law.unimelb.edu.au/judgments/states/federal/2008/april/2008fca455.htm
http://cclsr.law.unimelb.edu.au/judgments/states/nsw/2008/april/2008nswsc295.html
http://cclsr.law.unimelb.edu.au/judgments/states/nsw/2008/april/2008nswsc345.html
B & B Budget Forklifts Pty Ltd v CBFC Ltd [2008] NSWSC 271 is latest judicial analysis on the distinction between fixed and floating charges. It also examines the nature of "purchase money" security. The decision can be viewed at:
http://cclsr.law.unimelb.edu.au/judgments/states/nsw/2008/april/2008nswsc271.html
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