July 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 Generally, it is too onerous a task for us to check and update these and so if a hyperlink is no longer valid, please accept our apologies.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 a document listing the remaining issues that are being addressed by the development of further amendments to the Corporations Regulations and potential amendments to the Financial Services Reform Amendment Bill 2003. For a copy, go to:
The ACCC is taking action against a corporation practising law in the NT and its principal alleging that they engaged in conduct in breach of the Trade Practices Act by issuing tax invoices for legal fees impliedly and falsely representing that the invoices had been calculated in accordance with a retainer agreement between the company and the client, with the result that the client was overcharged. See Media Release 143/03:
http://203.6.251.7/accc.internet/digest/view_media.cfm?RecordID=1065
APRA has released final authorisation guidelines for specialist credit card institutions and a new prudential standard on risk management of credit card activities for authorised deposit-taking institutions. For details, see Media Release 03.63:
http://www.apra.gov.au/media-releases/03_63.cfm
ASIC has released a new licensing guide called Responsible officers: Demonstrating compliance with organisational competency obligations. The guide explains how applicants for an Australian financial services licence can demonstrate that they comply with ASIC's organisational competency obligations in Policy Statement 164 Licensing: Organisational capacities. For a copy of the guide, go to:
http://asic.gov.au/asic/pdflib.nsf/LookupByFileName/PS_164_guide.pdf/$file/PS_164_guide.pdf
ASIC has released final guidelines on the use of past performance information in investment advertisements. For a copy of the guidelines, go to:
ASIC has released an FAQ to assist issuers of promissory notes in understanding their obligations under the Corporations Act. The FAQ provides guidance on the circumstances when promissory notes are likely to be regulated as financial products. See Information Release IR 03-16:
http://www.asic.gov.au/asic/ASIC_PUB.NSF/byid/6455F588FEAAA630CA256D63000C6036?opendocument
ASIC has announced its interim position in relation to the regulation of mutual risk products. These are risk products that provide an alternative to conventional general insurance products, typically involving participation in a mutual scheme based around particular professions, small business associations, franchise operations or community groups. See Information Release IR 03-17:
http://www.asic.gov.au/asic/ASIC_PUB.NSF/byid/144E3E0C8765100DCA256D64001A0675?opendocument
In response to the FSR legislative changes, the SFE is phasing out its arbitration service for settlement of disputes between participants and their clients. The associated conciliation service will continue to be available. However, where conciliation is unsuccessful, rather than move on to arbitration, as at present, the parties will need to use the services of an external dispute resolution scheme. See SFE Bulletin No 38/03:
http://www.sfe.com.au/Content/bulletins/sfe/2003/sfe2003_038.pdf
For a general summary of recent developments in banking and finance, see Allens Arthur Robinson, Finance & Banking Update - July 2003:
http://www.aar.com.au/pubs/baf/fabjul03.htm
Mallesons, Corporate Governance Alert - July 2003 has an interesting discussion of some of the legal, commercial and tax issues (especially solvency considerations) associated with the transition across to the income tax consolidation regime. See:
For an analysis of the ramifications of the Court of Appeal decision in Whitlam v ASIC, see Gilbert & Tobin, The Decision of the Court of Appeal in Whitlam v Australian Securities & Investments Commission and its Implications for Directors Acting as Proxies:
http://www.gtlaw.com.au/binaries/pdf/publications/Whitlam%20v%20ASIC%20Decision.pdf
For a general summary of recent developments in employee relations law, see Allens Arthur Robinson, Focus: Workplace Relations - July 2003:
http://www.aar.com.au/pubs/pdf/wr/fowrjul03.pdf
The Full Bench of the Australian Industrial Relations Commission has set aside an order that permitted unions to use an employer's email system to send bulletins to union representatives and employees. For details, see Deacons, AIRC Ruling Means no Open Slather for Unions on E-mail:
http://www.deacons.com.au/news/article.asp?nID=347
Minter Ellison, Technology News - 2 July 2003 has an interesting discussion of the Canadian decision in Zhu Zhu v Merrill Lynch HSBC, involving sales over the internet and the legal effect of disclaimers. See:
http://www.minterellison.com/ajpe/resources/file/eb00084500ba5ce/Technology_July03.pdf
Blake Dawson Waldron, Managed Investments Update - July 2003 analyses the ramifications of the Takeovers Panel decision in Centro's bid for AMP's Retail Shopping Centre Trust and its implications for listed property trusts that have properties subject to co-ownership agreements. See:
http://www.bdw.com.au/publications/managed/managed072003.pdf
Freehills, The Ngarluma Yindjiarndi Decision: Native Title and the West Pilbara - 25 July 2003 discusses the Federal Court's decision in the Ngarluma and Yindjiarndi Peoples' native title claim, which is the first case in Western Australia to apply the principles set out by the High Court in the Yorta Yorta and Ward decisions. See:
Blake Dawson Waldron, i-on-FSR - July 2003 analyses some of the disclosure and FSR implementation issues relevant to corporate superannuation plans. See:
http://www.bdw.com.au/publications/i-on-fsr/i-on-fsr072003.pdf
Allens Arthur Robinson, Focus: Tax – July 2003 summarises a number of significant developments in stamp duty legislation across Australia in recent months, including in the area of stamp duty relief for corporate reconstructions. See:
http://www.aar.com.au/pubs/pdf/tax/fotaxjul03.pdf
In Whitlam v ASIC [2003] NSWCA 183, the NSW Court of Appeal upheld the appeal by former NRMA Limited President Nick Whitlam against the decision at first instance that he had breached his duties as a director in failing to vote proxies as directed (reported in our July 2002 update). The full text of the decision can be downloaded at:
http://cclsr.law.unimelb.edu.au/judgments/states/nsw/2003/july/2003nswca183.htm
Those interested in the HIH debacle and corporate governance issues generally will find the NSW Court of Appeal decision in Adler and Williams v ASIC [2003] NSWCA 131 of interest. The full text of the decision can be downloaded at:
http://cclsr.law.unimelb.edu.au/judgments/states/nsw/2003/july/2003nswca131.htm
In Silbermann, Rich and Greaves v CGU Insurance Limited [2003] NSWCA 203 the NSW Court of Appeal held that the insurer under a D&O policy was entitled to refuse to indemnify the claimants for legal costs prior to a judgment or final adjudication about the applicability of an exclusion clause for dishonesty or fraud. The full text of the decision can be downloaded at:
http://cclsr.law.unimelb.edu.au/judgments/states/nsw/2003/july/2003nswca203.htm
In Gifford v Strang Patrick Stevedoring Pty Ltd [2003] HCA 33, the High Court has held that an employer had a duty of care to prevent its employee's children suffering psychiatric harm as a result of injuries to the employee at the workplace. The full text of the judgment can be viewed at:
http://www.austlii.edu.au/au/cases/cth/high_ct/2003/33.html
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