October 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 Generally, it is too onerous a task for us to check and update these and so if a hyperlink is no longer valid, please accept our apologies.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 the Corporate Law Economic Reform Program (Audit Reform & Corporate Disclosure) Bill for public consultation. You can download a copy of the draft Bill and accompanying commentary at:
http://www.treasury.gov.au/contentitem.asp?pageId=&ContentID=700
Treasury has updated its announcement last month regarding the Financial Services Reform Amendment Bill 2003, which is currently before the Parliament. The Government proposes to move amendments to the Bill when it is debated, which is now expected to occur in November. The amendments are in a different order and include some additional materials from those announced last month. For a copy of the proposed amendments and explanatory statement, go to:
The Sex Discrimination Amendment (Pregnancy and Work) Act 2003 has been proclaimed. It amends the Sex Discrimination Act 1984 (the Act) to clarify that discrimination against women who are breastfeeding is prohibited by the Act, questions regarding pregnancy or potential pregnancy may not be asked during recruitment processes, and that medical information collected from pregnant women may only be used for appropriate purposes, such as for genuine occupational health and safety reasons and not in a discriminatory manner. For a copy of the Act and the related explanatory memorandum, go to:
http://scaleplus.law.gov.au/html/comact/11/6707/top.htm
http://scaleplus.law.gov.au/html/ems/0/2002/0/20020214sexem.htm
The Workplace Relations Amendment (Fair Termination) Act 2003 has been proclaimed. It amends the Workplace Relations Act 1996 to exclude certain casual and temporary employees from the operation of the employment termination provisions. For a copy of the Act and the related explanatory memorandum, go to:
http://scaleplus.law.gov.au/html/comact/11/6708/top.htm
http://scaleplus.law.gov.au/html/ems/0/2002/0/20020220wrftem.htm
The Taxation Laws Amendment Act (No 3) 2003 amends the capital gains tax provisions that deal with employee share schemes to ensure the law operates as intended. The amendments deal with the situation where the scheme is operated through a trust and the employee chooses to be taxed under the employee share provisions of the income tax law. For a copy of the Act and the related explanatory memorandum, go to:
http://scaleplus.law.gov.au/html/comact/11/6706/top.htm
http://scaleplus.law.gov.au/html/ems/0/2003/0/2003093001.htm
ACCC has released a discussion paper and draft guidelines for developing and endorsing industry codes of conduct. For a copy of the discussion paper and draft guidelines, go to:
http://www.accc.gov.au/pubs/publications/industry/general/Voluntary_Industry_Code_Oct03.pdf
ASIC has released version 4 of its eLicensing and AFS licensing kit, which takes into consideration the further widening of eligibility for streamlining and recent class orders. For details, see Information Release IR 03-32:
http://www.asic.gov.au/asic/ASIC_PUB.NSF/byid/BDFE7803489739ADCA256DC60002F662?opendocument
ASIC has reissued Pro Forma 209 Australian financial services licence conditions with amendments to address the introduction of new regulations and changes to ASIC policy, including Policy Statement 166 Licensing: Financial requirements and Policy Statement 175 Licensing: Financial product advisers — Conduct and disclosure. For details, see Information Release IR 03-33:
http://www.asic.gov.au/asic/ASIC_PUB.NSF/byid/301ECBAB1CCB5F1DCA256DC70011CEAD?opendocument
ASIC has released a new guide on how to meet the financial requirements under an AFS licence and prepare associated proof documents. You can download a copy of the guide at:
http://www.asic.gov.au/asic/pdflib.nsf/LookupByFileName/ps_166_guide.pdf/$file/ps_166_guide.pdf
ASIC has amended Policy Statements 167 and 169 to provide more guidance on the factors it considers when assessing applications for relief from the FSR licensing or disclosure provisions. For details, see Information Release IR 03-29:
http://www.asic.gov.au/asic/ASIC_PUB.NSF/byid/35ABEACD9508F98ACA256DB200824A38?opendocument
ASIC has released an overview of its decisions in some recent applications for relief from the FSR licensing, conduct and disclosure provisions. See Information Release IR 03-31:
http://www.asic.gov.au/asic/ASIC_PUB.NSF/byid/B5A5F25C5F351E8FCA256DBA00825625?opendocument
ASIC has released Policy Statement 177 Australian market licences: Overseas operators, relating to the licensing requirements for, and obligations of, operators of financial markets in other jurisdictions who wish to operate their market in Australia. For a copy of the Policy Statement, go to:
http://www.asic.gov.au/asic/pdflib.nsf/LookupByFileName/PS177.pdf/$file/PS177.pdf
ASIC has issued four class orders granting limited relief for foreign financial service providers. The relief is in response to industry concerns about whether the new FSR regime applies in some cases to certain providers of foreign financial services or products and the degree of duplication of certain obligations under the FSR regime where a service provider is sufficiently regulated in another jurisdiction. For details, see Information Release IR 03-28:
http://www.asic.gov.au/asic/ASIC_PUB.NSF/byid/2022AD6BEF7D6871CA256DB20001669B?opendocument
ASIC is seeking comments on a draft policy proposal paper entitled Licensing: Managing conflicts of interest, which is intended to provide guidance on the new conflicts management obligation for licensees proposed under the Commonwealth Government's Corporate Law and Economic Reform Program (CLERP 9) proposals. You can download a copy of the policy proposal paper at:
http://www.asic.gov.au/asic/pdflib.nsf/LookupByFileName/conflict_ppp.pdf/$file/conflict_ppp.pdf
ASX is seeking comments by 30 November 2003 on an exposure draft it has released entitled Capital Raising Mechanisms in a Disclosure-based Market - ASX Proposals for Informed Choice. The exposure draft outlines ASX proposals to amend certain aspects of Chapter 7 of the ASX Listing Rules, including listing rule 7.1 and the timetables for pro rata offers. The purpose of the proposed changes is to maximise flexibility in the structuring of capital raising mechanisms to better accommodate the capital raising needs of ASX listed entities. It is proposed the Listing Rule amendments will take effect on 30 January 2004. You can download a copy of the exposure draft and a separate Appendix B containing a detailed analysis of the timetables for pro rata offers at:
http://www.asx.com.au/about/pdf/CapitalRaising.pdf
http://www.asx.com.au/about/pdf/AppendixB.pdf
In light of the abovementioned ASIC policy proposal paper and developments overseas since ASX issued its second draft Business Rule Guidance Note on the topic of independence of research, disclosure of conflicts of interest and dealing before release of research recommendations in February 2003, ASX has decided to defer the finalisation of its draft Guidance Note until after submissions have been provided in response to the ASIC policy proposal paper. See Participant Circular 494/03:
ASX has issued a new Guidance Note 05/03 on confirmations. See Participant Circular 478/03 and attachment:
ASX has updated its explanatory booklet Understanding Trading & Investment Warrants. For details, see Participant Circular 454/03:
For a summary of the amendments to the law proposed in CLERP 9, see Blake Dawson Waldron, Corporate Governance Update: CLERP 9 - October 2003 and Clayton Utz, Insights: CLERP 9 special edition - 16 October 2003:
http://www.bdw.com.au/publications/governance/governance102003.pdf
http://www.claytonutz.com/areas_of_law/controller.asp?aolstring=&ns=76
For a more detailed look at the likely effect of CLERP 9 on the design of executive remuneration policies and their disclosure to shareholders, see Allens Arthur Robinson, Focus: Corporate Governance - October 2003:
http://www.aar.com.au/pubs/ma/focg13oct03.htm
For a more detailed look at the proposals in CLERP 9 to empower ASIC to issue 'on-the-spot' fines for continuous disclosure breaches, see Allens Arthur Robinson, Focus: Continuous Disclosure - October 2003:
http://www.aar.com.au/corpgov/pubs/focdoct03.htm
For a discussion of the ASX exposure draft on Listing Rules reforms designed to improve the capital raising options available to Australian listed entities, see Mallesons, Capital Markets Alert - 21 October 2003:
http://www.mallesons.com/publications/alerts/Capital_Markets_Alert_21_October_2003.pdf
For a discussion of the circumstances in which corporations are entitled to give to charity, see Freehills, Pursuing Profit Productivity and Philanthropy: The Legal Obligations Facing Corporate Australia - 22 October 2003:
The Victorian Supreme Court has overturned the VCAT decision in Age Old Builders Pty Limited v Swintons Pty Limited (mentioned in our June 2003 update) that an expert determination was an arbitration and therefore void because it breached the Domestic Building Contracts Act. For details, see Allens Arthur Robinson, Focus: Construction - October 2003:
http://www.aar.com.au/pubs/const/foconoct03.htm
For a general update on recent developments in employee relations, see Allens Arthur Robinson, Focus: Workplace Relations - October 2003:
http://www.aar.com.au/pubs/wr/fowroct03.htm
A package of Commonwealth bills has been passed that substantially changes the regime for the identification, protection and management of places with natural, indigenous or historical heritage significance. See Blake Dawson Waldron, The Dirt (Alert) - October 2003:
http://www.bdw.com.au/publications/thedirt/thedirt10-03.pdf
Allens Arthur Robinson, Focus: Native Title - October 2003 looks at two recent Federal Court decisions giving an insight into whether or not native title has been extinguished over an area of land. See:
http://www.aar.com.au/pubs/nat/fonatoct03.htm
For an analysis of the recent High Court decision in Visy Paper v ACCC, see Blake Dawson Waldron, Competition Law News - October 2003:
http://www.bdw.com.au/publications/competition/competition102003.pdf
The High Court of Australia database on AustLII now contains a complete digital set of the High Court's decisions from 1903 to date. You can access the database at:
http://www.austlii.edu.au/au/cases/cth/HCA/
In Visy Paper Pty Limited v ACCC [2003] HCA 59, the High Court had to address the interaction between sections 45 and 47 of the Trade Practices Act. In that case, Visy Paper sought to make an agreement with a supplier of waste that precluded the supplier from acquiring waste from other suppliers. The majority of the High Court held that the clause in question had a dual character - a restriction on the supplier from acquiring goods (waste paper) from particular persons (Visy Paper's customers) and a restriction on the supplier from supplying services to those persons (waste collection). The Court held that the latter aspect of the contract fell within section 47(10) and was therefore protected by section 45(6) but the former fell outside the scope of section 47 and therefore was not protected by section 45(6). The former aspect was therefore an unlawful exclusionary provision that breached sections 4D and 45(2)(a)(i). The full text of the judgment is available at:
http://www.austlii.edu.au/au/cases/cth/high_ct/2003/59.html
In ACCC v Commonwealth Bank of Australia [2003] FCA 1129, an advertisement with bold headlines that "no establishment fee" was payable for a home loan, when in fact customers had to either already hold or obtain two or three additional bank products to take up the offer of “no establishment fee”, was held to be misleading. The Federal Court said that the addition of the words "terms and conditions apply" did not override a false representation that is bold in its initial assertion. The full text of the judgment is available at:
http://www.austlii.edu.au/au/cases/cth/federal_ct/2003/1129.html
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