May 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 Generally, it is too onerous a task for us to check and update these and so if a hyperlink is no longer valid, please accept our apologies.
Further FSR amending regulations (the Corporations Amendment Regulations 2003 (No. 3) 2003 No. 85) have come into force. The regulations provide that a person is taken not to provide a financial service and therefore does not need to be licensed when performing certain services described in the regulations. These include administrative tasks such as the registration of companies, advice on shelf companies and trusts, audit advice, business advice, risk management advice, superannuation advice and taxation advice. For a copy of the regulations and explanatory statement, go to:
http://scaleplus.law.gov.au/html/numrul/19/9733/top.htm
http://scaleplus.law.gov.au/html/ess/0/2003/0/20030508085.htm
Draft regulations extending the FSR reforms to the provision of medical indemnity insurance have also been released for public consultation. For a copy of the announcement and draft regulations, go to:
http://www.treasury.gov.au/documents/650/RTF/Final website material 2003-05-29.rtf
http://www.treasury.gov.au/documents/650/PDF/Corps Regs to PST - final - 2003-05-19.pdf
A raft of enforcement action this month by the ACCC reminding businesses of the need to take care when advertising goods and services. These include:
| • | a Federal Court decision that a service provider who had advertised a GST-exclusive price with a statement, in some case in fine print, that it was "plus GST" had acted in breach of sections 52, 53(e) and 53(d) of the Trade Practices Act; |
| • | a Federal Court decision that a tour promoter had breached section 52 of the Trade Practices Act by promoting tours to an Aboriginal site near Uluru when they had no permission from the relevant Aboriginal governing body to enter the land or conduct the tours; |
| • | an admission in Federal Court proceedings that an advertisement for a "15% Off Everything" sale was misleading because not all products had been reduced by 15%; |
| • | a Federal court decision that a retailer had misled customers about their rights to refunds under the Trade Practices Act by telling consumers that they were not entitled to refunds on new, sale or seconds items; and |
| • | the ACCC instituting proceedings against a rental company about its 'Rent Two, Get One Rent Free' advertising campaign because it failed to sufficiently disclose the terms and conditions to which the offer was subject. |
See Media Releases 88/03, 89/03, 90/03,104/03 and 107/03:
http://203.6.251.7/accc.internet/digest/view_media.cfm?RecordID=1009
http://203.6.251.7/accc.internet/digest/view_media.cfm?RecordID=1010
http://203.6.251.7/accc.internet/digest/view_media.cfm?RecordID=1011
http://203.6.251.7/accc.internet/digest/view_media.cfm?RecordID=1025
http://203.6.251.7/accc.internet/digest/view_media.cfm?RecordID=1028
APRA has called for submissions from interested parties on the Basel Committee's updated proposals for the reform of bank capital adequacy guidelines. See Media Release 03.42 and the third consultative paper on the New Basel Capital Accord:
http://www.apra.gov.au/media-releases/03_42.cfm
http://www.bis.org/bcbs/bcbscp3.htm
ASIC has released an update of Policy Statement 49, Employee Share Schemes, outlining its policy on the disclosure and licensing relief it will grant in relation to employee share schemes. You can download a copy of the relevant information release (IR 03-14) and the updated Policy Statement at:
http://www.asic.gov.au/asic/ASIC_PUB.NSF/byid/1B43D217977C6834CA256D19001D4A1A?opendocument
http://www.cpd.com.au/asic/ps/ps049.pdf
ASIC has released draft guidelines to assist listed Australian companies when valuing options in the disclosure of emoluments for directors and executive officers in their annual reports. For a copy of the guidelines, go to:
http://www.asic.gov.au/asic/asic_polprac.nsf/byid/39D1497A261FD961CA256D1E0082A40C?opendocument
A compliance review by ASIC has led to the revocation of the licences of 10 securities dealers in South Australia for failure to comply fully with their licence conditions or to lodge the required financial reports. For a copy of the review report, go to:
ASX has updated its explanatory booklet, Understanding Options Trading, and issued a new Guidance Note dealing with when the updated booklet must be provided to clients under Business Rule 7.3.1.1. See Participant Circular 199/03 and Guidance Note 1/03:
ASX has released a new Guidance Note setting out its policy on ASX derivatives trading participants conducting derivatives trading on behalf of an ASX participating organisation that is not entitled to enter into options transactions in the derivatives market. See Participant Circular 208/03 and Guidance Note 2/03:
Amendments have been made to the ASX Futures Business Rules to incorporate operating rules for deliverable futures contracts over grain commodities. See Futures Notice 015/03 and attachments:
http://www.asx.com.au/about/pdf/disciplinarycirculars/Grains_ASXF_Circular_030514_C_MR.pdf
http://www.asx.com.au/about/pdf/disciplinarycirculars/Grains_ASXF_Circular_030514_AttA_MR.pdf
http://www.asx.com.au/about/pdf/disciplinarycirculars/Grains_ASXF_Circular_030514_AttB_MR.pdf
SFE has prepared a guide to assist participants that deal with retail clients to prepare a product disclosure statement under the FSR reforms. For a copy of the guide, go to:
http://www.sfe.com.au/index.asp?dispage=site/html/aboutsfe/framework/pds.pdf
For a discussion of the impact of the new Basel Capital Accord on securitisation practices in Australia, see Blake Dawson Waldron, Capital Markets and Securitisation Bulletin - May 2003:
http://www.bdw.com.au/publications/capitalmarkets/capitalmarkets052003.pdf
For a summary of the CLERP 7 reforms, see Blake Dawson Waldron, Corporate Law Update - May 2003:
http://www.bdw.com.au/publications/corporate/corporate052003.pdf
For a general summary of recent developments in employee relations law (including employer choice of super obligations), see Allens Arthur Robinson, Focus: Employee Relations - 28 May 2003:
http://www.aar.com.au/pubs/pdf/wr/fowrmay03.pdf
For a general update on developments in IP law, see Clayton Utz, Intellectual Property & IT Insights - 16 May 2003:
http://www.claytonutz.com/areas_of_law/controller.asp?aolstring=&ns=32
For a summary of two case notes recently released by the Privacy Commissioner on the mishandling of consumer financial information, see Freehills, Privacy and Financial Institutions - 8 May 2003:
The ACT has introduced a bill to impose mortgage duty for secured loans of $1 million or more undertaken for commercial purposes and to implement other stamp duty measures announced in the Territory Budget. For details, see Freehills, ACT Budget Announcement: Stamp Duty Changes - 14 May 2003:
The Pan Pharmaceuticals incident highlights the need for suppliers and manufacturers to be prepared to handle a potential product recall. For some helpful guidelines, see Allens Arthur Robinson, Recall: Pan Product Recall Offers Lessons For All - 09 May 2003:
http://www.aar.com.au/pubs/prod/recallmay03.htm
ASIC v Plymin, Elliott & Harrison [2003] VSC 123 is a tour de force of the insolvent trading provisions of the Corporations Act. The full text of the judgment can be viewed at:
http://cclsr.law.unimelb.edu.au/judgments/states/vic/2003/may/2003vsc123.htm
In Permanent Trustee Australia Limited v FAI General Insurance Company Limited (in Liq) [2003] HCA 25, the majority of the High Court found that an insured's disclosure obligations relate only to those matters which the insured knows, or a reasonable person in the circumstance could be expected to know, are relevant to the insurer's assessment of risk. It does not extend to matters of a commercial nature, such as whether the insured intends to renew the insurance with that insurer in the future. The full text of the judgment can be viewed at:
http://www.austlii.edu.au/au/cases/cth/high_ct/2003/25.html
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