May 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 Generally, it is too onerous a task for us to check and update these and so if a hyperlink is no longer valid, please accept our apologies.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 Cross-Border Insolvency Act 2008 (Cth) has now passed into law. The Act is available at:
The Attorney General has released a consultation draft of the Personal Property Securities Bill 2008, intended to enact uniform personal property security laws across Australia. The draft Bill and other related materials are available on the AG's website at:
The Federal Court has dismissed an application by Korean Air Lines challenging a statutory demand for information and documents issued by the ACCC under the Trade Practices Act 1974. See Media Release 128/08:
http://www.accc.gov.au/content/index.phtml/itemId/827816
ACCC has succeeded in enforcement action against 2 companies selling rugs and manchester using false "was/is" pricing and falsely asserting that the sales were limited duration liquidation sales. See Media Release 138/08:
http://www.accc.gov.au/content/index.phtml/itemId/828665
ACCC has also extracted an enforceable undertaking from a video retailer for advertising DVDs for sale under the banner headline of "the cheapest price in Australia - guaranteed" without giving equal prominence to a fine print exclusion "or we'll beat any lower advertised price by $1". See Media Release 148/08:
http://www.accc.gov.au/content/index.phtml/itemId/829632
APRA has extended the deadline for foreign insurers wishing to apply for a licence to write business in Australia from 31 May to 30 June. Those foreign insurers who submit their application and pay the application fee by 30 June will be allowed to continue operating in the Australian market for up to 6 months while their application is processed. See Media Release 08.11:
http://www.apra.gov.au/media-releases/08_11.cfm
ASIC has released Regulatory Guide 189 Disclosure relief for rights issues, explaining new class order relief designed to ensure that certain rights issue features that are becoming more prevalent (including accelerated offers to institutions, book-builds for the disposal of a shortfall and offers to holders of convertible securities) enjoy the prospectus and PDS disclosure exemption for "traditional" rights issues. For a copy of the new regulatory guide, go to:
http://www.asic.gov.au/asic/pdflib.nsf/LookupByFileName/rg189.pdf/$file/rg189.pdf
ASIC has approved the new Financial Ombudsman Service as an acceptable external complaints resolution scheme for the purposes of Chapter 7 of the Corporations Act. The FOS merges the Financial Industry Complaints Service, the Banking and Financial Ombudsman Service and the Insurance Ombudsman Service. See Media Release 08-103:
ASX and Standard & Poor’s Index Services have released a consultation paper seeking market feedback on a proposal to make foreign exempt companies listed on ASX eligible for index inclusion. See ASX Media Release dated 6 May 2008:
http://www.asx.com.au/about/pdf/media_release_asx_sp_foreign_indices_060508.pdf
ASX is amending its market rules to reflect a decision to migrate exchange traded funds from the equities section of the integrated trading system to the warrants section. See Market Circular 213/08 and attachment:
AUSTRAC has released its first 2 public legal interpretations under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth). The first relates to item 54 in table 1 of section 6 of the Act, which includes in the list of providers of "designated services" the holder of an Australian financial services licence who, in that capacity, makes an arrangement for a person to receive a designated service. The second relates to the obligation for a provider of registrable designated remittance services to register under the Act. The PLIs can be viewed at:
http://www.austrac.gov.au/files/pli_n2.pdf
http://www.austrac.gov.au/files/pli3_pdrs.pdf
AUSTRAC has released for consultation draft AML/CTF Rules setting out the required contents for disclosure certificates so that they can be considered to be reliable and independent documentation for the purposes of verifying the identity of a customer. The rules are available at:
http://www.austrac.gov.au/files/draft_rules_disclosure_certificates.pdf
One we missed last month - in April, AUSTRAC also released for consultation draft AML/CTF Rules that carve out of the definition of "loan" in the AML/CTF Act certain products such as money market instruments, government or corporate bonds, debenture stock, bonds and debt instruments. The purpose of the draft rules is to remove the potential dual application of two types of designated services to these types of instruments. The rules are available at:
http://www.austrac.gov.au/files/draft_rules_loan_definition.pdf
From 1 July 2008, the "local participant" membership category on the SFE will be cease to exist. Only full and proprietary full participants will be able to trade on SFE markets on and from that date. ASX is also discontinuing the Australian Equity Products Incentive Program offered to local participants and individual clients trading in Australian equity derivative products on the SFE. See SFE Notice 063/08:
http://www.sfe.com.au/content/notices/2008/notice2008_063.pdf
Corrs Chambers Westgarth, Are "Exception Fees" Penal and Therefore Unenforceable? - 9 May 2008 summarises the recent English decision in Office of Fair Trading v Abbey National plc [2008] EWHC 875 (Comm), holding that exception fees imposed by banks are not penalties at common law and therefore are not unenforceable on that basis. See:
http://www.corrs.com.au/corrs/website/web.nsf/Content/Pub_TGIF_Exception_Fees_Unenforceable_090508
The Western Australian Court of Appeal has recently considered the construction of an "all moneys" clause in a mortgage and the effect of such a clause where a bank assigns the mortgage and secured moneys to a third party. For an analysis of the decision, see Corrs Chambers Westgarth, "All Moneys" Clauses in Assigned Securities - 16 May 2008:
http://www.corrs.com.au/corrs/website/web.nsf/Content/Pub_TGIF_All_Moneys_Clauses_Securities_160508
For a general discussion of recent developments in employee relations law, see Allens Arthur Robinson, Focus: Workplace Relations - May 2008:
http://www.aar.com.au/pubs/pdf/wr/fowrjun08.pdf
As part of the wash-up of Opes Prime, the Federal Court of Australia has upheld the conventional view that so-called securities loans are not loans at all but in fact involve an absolute transfer of title to the relevant securities with a covenant to re-transfer equivalent securities at the conclusion of the "loan". For a summary of the decision, see Mallesons Stephen Jaques, Australian Court Confirms Absolute Transfer - 2 May 2008:
http://www.mallesons.com/publications/2008/Apr/9407953W.htm
On Friday 2 May 2008, the much awaited Anti-Money Laundering and Counter-Terrorism Financing Rule for securities dealing was promulgated by AUSTRAC. It contains important exemptions from the Anti-Money Laundering and Counter-Terrorism Financing Act relating to securities issuing and trading. See Mallesons Stephen Jaques, Anti Money Laundering Changes for Securities Dealing - 5 May 2008:
http://www.mallesons.com/publications/2008/May/9424085W.htm
An issues paper has been published as part of the 2007-2008 review of the Code of Banking Practice. Submissions in response to the issues paper are invited by 11 July 2008. See Mallesons Stephen Jaques, Review of the Code of Banking Practice - Issues Paper Released for Consultation - 29 May 2008:
http://www.mallesons.com/publications/2008/May/9460949W.htm
Freehills, Document Retention: Where do I Start? - 30 May 2008 provides a brief outline of some key considerations which can drive an effective document management or retention strategy and provides some practical tips in devising a policy which has a reasonable prospect of consistent implementation. See:
http://www.freehills.com.au/publications/publications_7223.asp
The Federal Government is set to implement its election promise to remove discrimination against same sex couples in superannuation law with the introduction into the House of Representatives of the Same-Sex Relationships (Equal Treatment Commonwealth Laws – Superannuation) Bill 2008. For further details, see Minter Ellison, Alert - Superannuation Reforms: Going Beyond the Traditional Family - 30 May 2008:
The pace of superannuation reform continues with a number of proposals and recent changes that will affect the way employers are required to satisfy their superannuation obligations. The changes relate to the calculation of superannuation guarantee contributions, an extension of the SG late payment offset, the taxation of employment termination payments, and the introduction of a Superannuation Clearing House. See Mallesons Stephen Jaques, A Changing Superannuation Landscape for Employers - 22 May 2008:
http://www.mallesons.com/publications/2008/May/9442977W.htm
The Board of Taxation has released issues papers on possible reforms to Australia’s foreign source income anti-tax-deferral regimes. The proposed reforms will consider the controlled foreign company, foreign investment fund, transferor trust and deemed present entitlement regimes. The issues papers cover the listed public company exemption, the active investment exemption, the distribution exemption, the identification and measurement of interests and branch equivalent calculations. For details, see Mallesons Stephen Jaques, Offshore Funds - Release of CFC/FIF Issues Papers - 21 May 2008:
http://www.mallesons.com/publications/2008/May/9447241W.htm
For a two-part series summarising recent stamp duty changes across Australia, see Allens Arthur Robinson, Focus: Tax - 26 and 28 May 2008:
http://www.aar.com.au/pubs/tax/fotaxmay08.htm
http://www.aar.com.au/pubs/tax/fotax28may08.htm
For the latest litigation instalment in the Opes Prime saga, see Beconwood Securities Pty Ltd v Australia and New Zealand Banking Group Limited [2008] FCA 594 and Melewar Steel Ventures Limited v ANZ Nominees Limited [2008] NSWCA 68:
http://cclsr.law.unimelb.edu.au/judgments/states/federal/2008/may/2008fca594.htm
http://cclsr.law.unimelb.edu.au/judgments/states/nsw/2008/april/2008nswca68.htm
Allmere Pty Ltd v Burbank Trading Pty Ltd [2008] VSC 139 deals with the interesting issue of whether the appointment of an administrator to one shareholder involved an "ultimate change of control" and therefore triggered pre-emptive rights in favour of another shareholder under a shareholders agreement. The decision can be viewed at:
http://cclsr.law.unimelb.edu.au/judgments/states/vic/2008/may/2008vsc139.htm
For the latest High Court pronouncement on native title and how it co-exists with the compulsory land acquisition provisions in State and Territory legislation, see Griffiths v Minister for Lands, Planning and Environment [2008] HCA 20:
http://www.austlii.edu.au/au/cases/cth/HCA/2008/20.html
In Commissioner of Taxation v Reliance Carpet Co Pty Limited [2008] HCA 22, the High Court held that the forfeit of a deposit paid under a contract for sale of land involves the provision of a taxable supply and is therefore potentially subject to GST. The decision can be viewed at:
http://www.austlii.edu.au/au/cases/cth/HCA/2008/22.html
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