August 2003
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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 Generally, it is too onerous a task for us to check and update these and so if a hyperlink is no longer valid, please accept our apologies.
Treasury has released for public comment proposed regulations making a number of further amendments to the FSR provisions. For a copy of the draft regulations and commentary, go to:
http://www.treasury.gov.au/documents/642/PDF/0304600B-030821A%20Consultation%20draft.pdf
http://www.treasury.gov.au/documents/642/PDF/Reg%20Commentaries.pdf
ASIC will review the financial reports of 440 publicly listed Australian entities for their compliance with accounting standards. In particular, their financial reports will be reviewed to identify companies that are corporate sponsors of an employee defined benefit superannuation or pension plan and to assess whether the company has correctly accounted for any deficit under that plan. See Media Releases 03-242 and 03-263:
http://www.asic.gov.au/asic/ASIC_PUB.NSF/byid/3674C452E1B9507ACA256D780006C278?opendocument
http://www.asic.gov.au/asic/ASIC_PUB.NSF/byid/9C5D01D98DFC484ACA256D890005D5C4?opendocument
ASIC has released a good practice model for fee disclosure in the product disclosure statements for investment products. See Media Release 03-243:
http://www.asic.gov.au/asic/ASIC_PUB.NSF/byid/F7234B250C5EF9CACA256D790005B7B6?opendocument
ASIC has released a new class order exemption (CO 03/606) exempting a person from the requirement to hold an Australian Financial Services Licence for the provision of financial product advice where that advice is general advice and the advice is contained in a document that is required by, and prepared by the person as a result of a requirement in, the Corporations Act or the Superannuation Industry (Supervision) Act. See Information Release IR 03-20:
http://www.asic.gov.au/asic/ASIC_PUB.NSF/byid/3BC2181E80C2EE68CA256D7A00164A7B?opendocument
ASIC has released an updated version of its guide Small business and your AFS licence: Compliance with Policy Statement 164. For a copy of the guide, go to:
ASIC has released the findings of its industry surveillance review examining the independence of research analysts in the investment banking industry. ASIC is now preparing a policy proposal paper that will set out high level principles and guidance for AFS licensees generally about managing conflicts of interest, with more detailed guidance for providers of research reports. For a copy of the surveillance report, go to:
Amendments have been made to the ASXF Business Rules. The purpose of the amendments is to remove certain capital reporting requirements where a participant of ASXF is a clearing participant of OCH. Other minor changes have also been made to make the ASXF Business Rules consistent with the OCH Derivative Clearing Rules. See ASX Futures Notice 031/03 and attachment:
http://www.asx.com.au/about/pdf/Miscchanges_ASXF_Circular_030820_C_MR.pdf
http://www.asx.com.au/about/pdf/Miscchanges_030820_Circular_ATT%20A%20_MR.pdf
The SFE has made various technical amendments to its operating rules. See SFE Bulletin 46/03:
http://www.sfe.com.au/Content/bulletins/sfe/2003/sfe2003_046.pdf
Banks subscribing to the new Code of Banking Practice may face difficulties in complying with some of its key features, according to Freehills, Complying with the New Code of Banking Practice: The Next Chapter - 15 August 2003. For a discussion of the consequences of breaching the new Code and some of the issues banks may encounter in determining its scope and implementing provisions relating to guarantees and joint debtors, see:
In a similar vein, see Allens Arthur Robinson, Focus: Banking & Finance – August 2003, highlighting the impact of the 'small business' provisions in the new Code of Banking Practice on project and structured finance special purpose vehicles:
http://www.aar.com.au/pubs/baf/fobafaug03.htm
For a general update on developments in corporate governance (including developments on directors' and executives' remuneration and a recent court case on whether a company's lenders should be treated as de facto directors), see Clayton Utz, Corporate Governance Insights – 8 August 2003:
http://www.claytonutz.com/areas_of_law/controller.asp?aolstring=&ns=53
The Federal government has announced its intention to introduce legislation to ban email "spam". For details, see Mallesons Stephen Jaques, Unsolicited Electronic Marketing - August 2003:
For general updates on recent developments in employee relations, see Allens Arthur Robinson, Focus: Workplace Relations - 28 August 2003 and Deacons, Enterprise - August 2003:
http://www.aar.com.au/pubs/wr/fowraug03.htm
http://www.deacons.com.au/Upload/NewsUploads/News361.pdf
The Queensland Government is overhauling its cultural heritage legislation. Two Bills have been introduced into Parliament which repeal the existing legislation and replace it with specific legislation applying only to Aboriginal and Torres Strait Islander cultural heritage. For details, see Allens Arthur Robinson, Focus: Native Title - 22 August 2003:
http://www.aar.com.au/pubs/nat/fonataug03.htm
For an analysis of the most recent High Court decision on exclusionary provisions, see Freehills, The High Court Clarifies Exclusionary Provisions: News Limited v South Sydney - 27 August 2003:
And for an analysis of the impact of that decision on joint venture arrangements, see Blake Dawson Waldron, Competition News - August 2003:
http://www.bdw.com.au/publications/competition/competition082003.pdf
The Full Federal Court has overturned the finding that record companies Warner and Universal had misused their market power by refusing to supply various retailers on the basis that they had imported CDs from overseas. For an analysis of the decision, see Mallesons Stephen Jaques, Competition Law Alert - 26 August 2003:
For an analysis of the decision of the Full Federal Court in ACCC v Safeway on price fixing and misuse of market power, see Allens Arthur Robinson, Focus: Competition Law - August 2003:
http://www.aar.com.au/pubs/comp/foclaug03.htm
In Massey v Wales [2003] NSWCA 212, the NSW Court of Appeal rejected the notion sometimes put forward in company law textbooks that a general meeting has reserve powers to act where the board of directors of a company is deadlocked or otherwise unable to act. The court said that the proper course in these circumstances was for the general meeting to appoint additional directors, who could then make a decision on behalf of the company. The full text of the decision can be downloaded at:
http://cclsr.law.unimelb.edu.au/judgments/states/nsw/2003/august/2003nswca212.htm
News Limited v South Sydney District Rugby League Football Club Limited [2003] HCA 45 clarifies the law on exclusionary provisions, as defined in section 4D, and made unlawful by section 45(2), of the Trade Practices Act. A majority of the High Court held that the relevant test for determining whether an exclusionary purpose existed was a subjective one and that the exclusionary arrangement must be directed toward a particular person or class of persons who were identifiable at the time of making the arrangement. The full text of the decision can be downloaded at:
http://www.austlii.edu.au/au/cases/cth/high_ct/2003/45.html
In Universal Music Australia Pty Ltd v ACCC [2003] FCAFC 193, the Full Federal Court overturned the decision at first instance that Universal and Warner had breached section 46 of the Trade Practices Act (misuse of substantial market power), ruling that their market shares in the wholesale market for recorded music in Australia (17.6% and 16% respectively) did not give them the requisite substantial degree of market power. That was something of a pyrrhic victory for the appellants, however, because the court upheld the finding that they had contravened section 47 of the Trade Practices Act by engaging in exclusive dealing and increased the penalty for that from $450,000 each to $1 million each. The full text of the decision can be downloaded at:
http://cclsr.law.unimelb.edu.au/judgments/states/federal/2003/august/2003fcafc193.htm
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