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Corporate & Commercial Law Articles
Unfair Terms in Consumer Contracts
Following the recent report from the Australian Competition and Consumer Commission (ACCC) and the investigation of Mr Rental’s Rental agreement by the Australian Securities and Investment Commission’s (ASIC), any business which has an agreement with its customers concerning the provision of a service, good or credit (inclusive of consumer leases) should carefully > Read More
Proposed changes to the Body Corporate and Community Management Act
Prior to April 2011, lot entitlements were set by developers to determine the proportion a unit owner contributes towards shared body corporate expenses. This system inevitably resulted in some owners contributing more, and others less, however provision was made for lot owners to make an application for the lot entitlements to be > Read More
Audit Relief for Company Groups
Chapter 2M of the Corporations Act 2001 (Cth) (Act) provides the financial reporting and audit requirements for companies, which include an obligation on all companies to keep financial records and an obligation on public companies and large proprietary companies to prepare financial reports and directors’ reports. Under section 301(1), a company must > Read More
Consumer Guarantees under the Australian Consumer Law
This article assumes that the general article on the Australian Consumer Law (ACL) has been read. The consumer guarantees contained in the ACL are a major change from the ones previously contained within the former Trade Practices Act 1974 (Cth) (TPA), as a breach of the consumer guarantees now gives rises to > Read More
Australian Consumer Law and the General Protection Provisions
On 1 January 2011, the Australian Consumer Law (ACL) introduced a new nationally consistent system to: (a) protect Australian consumers (b) foster competition (c) reduce the costs of doing business in Australia (d) enable the confident participation of consumers in markets in which both consumers and businesses trade fairly This was completed > Read More
Duty of Directors to Prevent Insolvent Trading
Directors of Australian companies have duties both under common law and statute to ensure that the company does not incur debts while insolvent. Common Law Duties At common law, this duty falls under the director’s duty of care and diligence. Generally, this duty of care and diligence is not measured by a > Read More
PPS Leases and Retention of Title Clauses
Introduction As per our article on the PPSR the Personal Property Securities Act 2009 (Cth) (Act) introduced the new Personal Property Securities Register (PPSR) which commenced on the 30 January 2012. Prior to the PPSA the following were generally not required to be registered: (a) a sale of goods on a retention > Read More
Resettlement of Trusts – Clarke’s Case
Introduction When amending trusts it is important to make changes which would result in the resettlement of the trust. This is to avoid the potential tax consequences such as,liability to pay: stamp duty capital gains tax income tax; or the loss of the ability to carry forward a previous year’s tax losses > Read More
The New National Business Name Register
Introduction On 28 of May 2012 the new national business name register replaced the previous state and territory services to allow for the registration of business names with a single register. The register is administered by the Australian Securities and Investments Commission (ASIC) and is publicly assessable at asicconnect.asic.gov.au/public. The major benefit > Read More
Personal Property Securities Register
The Personal Property Securities Register (PPSR) commenced operation on 30 January 2012, replacing a number of registers including, most relevantly for general commercial purposes, the ASIC register of company charges and the various State bill of sale registers. The legislative framework for the PPSR was established by the Personal Property Securities Act > Read More
Discretionary Trusts – An Explanatory Memorandum
GENERAL OUTLINE Discretionary trusts can be confusing and complex, especially if you are using them for the first time. To assist your understanding, we have prepared these notes on the nature and operation of our discretionary trust (which is called the “Trust”). If at any time you are uncertain as to the > Read More
Strict compliance with the Corporations Act required for minutes to be evidentiary
The case of Australian Securities and Investments Commission v Macdonald (No 11) [2009] NSWSC 287 (ASIC v Macdonald) decided in the New South Wales Supreme Court, highlights the importance of strict adherence to the requirements of the Corporations Act 2001 (Cth) when preparing minutes of Directors’ meetings (Board Meetings) in order for > Read More
Buying or establishing a small business
Unfortunately, too many new small businesses fail within a very short period of time, often with disastrous personal losses to the owners. The best chance for new business success is to get the right start with professional guidance from Rostron Carlyle’s Solicitors. Business Structures When setting up a new business or buying > Read More
What restrictions apply to foreign investment in Australia?
The Australian Government’s Foreign Investment Policy (Policy) generally regards investment by foreigners positively, subject to certain restrictions imposed by the Foreign Investment Review Board (FIRB), a section of the Commonwealth Department of Treasury. The Foreign Acquisitions and Takeovers Act 1975 (Cth) (FATA) regulates non-residents acquiring interests in Australian assets. Foreign Investment Review > Read More
What is a discretionary trust and what are the advantages?
What is a Trust? A trust is a relationship where a person (the Trustee) is under an obligation to hold property for the benefit of other persons (the Beneficiaries). The terms of the obligation are defined by the terms of the Trust Deed entered into between the Trustee and the Settlor. The > Read More
Sciacca v Tzvetkoff and BT Projects
Widely reported Gen-Y internet tycoon Daniel Tzvetkoff (Tzvetkoff), is being sued by former co-director Salvatore Sciacca (Sciacca) according to a claim filed in the Supreme Court in Brisbane on 7 July 2009. Tzvetkoff made headlines earlier this year for his $A28 million dollar real estate purchase from Tony Smith, founder of Breakfree, > Read More
Attacking trust assets
You appoint a trustee in bankruptcy and you find that the bankrupt was the trustee of a discretionary trust. What issues need to be considered? Can the Trust assets be attacked? Indemnity A trustee is liable for the debts of the trust, that it has incurred for and on behalf of the > Read More
Is a quote a binding offer? – lessons from Megalift v Terminals [2009] NSWSC 324
The end of the golden handshake – proposed changes to executive termination benefits
On 7 September 2009, the Senate Economics Legislation Committee released its Final report the Rudd Governments Corporations Amendment (Improving Accountability on Termination Payments) Bill 2009 (Bill) aimed at reducing excessive executive termination benefits. The current provisions of the Corporations Act 2001 (Cth) (Act) allows for termination benefits of up to 7 times > Read More
Is your company’s ACN on all your public documents?
Do your public documents have your Australian Company Number (ACN) on them? Surprisingly, many businesses are not complying with the section 88A of the Corporations Act 2001 (Cth) (Act) by omitting their ACN from their public documents. Section 153 of the Act provides that a company must set out its name on > Read More
Are you providing Financial Assistance – what is a financial assistance whitewash?
A company is generally seen as giving financial assistance if it gives something needed to carry out a transaction or something in the nature of aid or help. A financial assistance whitewash is a procedure that involves obtaining shareholder approval of the financial assistance, the subsequent notices and ASIC lodgements as described > Read More
Cooperative Structure Fact Sheet Queensland
A Cooperative is an association of people who join together voluntarily to meet common objectives through a jointly owned and democratically controlled entity. It may be trading or non-trading and may provide goods or services to its members or the public. At first glance a Cooperative may appear to be similar to > Read More
Changes to component pricing laws and the Trade Practices Act
The Trade Practices Amendment (Clarity in Pricing) Act 2008 (the new Act) came into effect on 25 May 2009. The new Act introduced new requirements for ‘component pricing’ by amending sections 53C and 75AZF of the Trade Practices Act 1974 (TPA). The new Act applies to the advertising of consumer goods and > Read More
Shareholder oppression explained
Shareholders may seek a wide range of remedies in circumstances where the controllers of a company unfairly misuse their positions of power or breach their duties. The oppression remedy in Part 2F.1 of the Corporations Act 2001 (Cth) (Act) provide an important safeguard for shareholder rights. It is usually used in conjunction > Read More
The R&D Tax Credit Exposure Draft
Has Treasury given us what we always wanted or just another pair of socks? The Treasury Consultation Paper, “The new research and development tax incentive“, released in September 2009 was a great disappointment to the Australian R&D community. How do we know this? Because 165 submissions to the Treasury were made publicly > Read More
Sons of Gwalia to be reversed through legislative intervention
In the case of Sons of Gwalia Ltd v Margaretic [2007] HCA 1 (Sons of Gwalia) the High Court held that shareholders’ whose losses arose because of a company’s inadequate disclosure or misrepresentation would rank equally with the debts of unsecured creditors, thus raising the status of aggrieved shareholders to those of > Read More
Retention of Title Clauses lose effectiveness
In late 2009 the Commonwealth Government introduced the Personal Property Securities Act 2009 (Act), the purpose of which was to introduce a national regime for the registration of security interests over personal property. Reform of Australia’s Personal Property Securities Law In late 2009 the Commonwealth Government introduced the Personal Property Securities Act > Read More
Amendments to the Franchising Code of Practice
Rostron Carlyle’s Commercial Lawyers provide a wide range of services to businesses, corporate clients, joint venturers and franchises. Rostron Carlyle aims to ease the burden associated with complying with the ever increasing compelxity of government regulation of businesses and franchises. Recent amendments have been made to the Franchising Code of Conduct (Code) > Read More
Raising capital without disclosure
General In the ordinary course where there is an offer of securities, a disclosure document must be prepared. However, there are some exceptions to this rule under sections 708, 708AA and 708A of the Corporations Act 2001 (Cth) where disclosure is not required. This article will briefly consider the small scale offering sophisticated investor > Read More
Raising capital with disclosure
General In order to raise capital, companies issue securities which may includes shares, debentures, and options to acquire shares and debentures. The Corporations Act 2001 (Cth) requires that disclosure to be made, subject to the certain exemptions, where an offer is made. If there is a failure to disclose in accordance with > Read More
Is your trust up to date?
General A trust is an entity where a trustee holds and controls property or other assets for the benefit of another person or persons (beneficiaries). A discretionary trust allows the trustee to determine both to whom and how the trust’s property is distributed. The Bamford Case The High Court of Australia, in > Read More
Franchising your business in Australia
Introduction Franchising if done properly is a great way to expand your business without you having to inject the relatively large amounts of capital required if you decided to expand by yourself. Essentially franchising your business requires you form an agreement with a franchisee where in return for you providing the “know > Read More
$10,000 Queensland Building Boost Grant – 1 August 2011
What is the Queensland Building Boost Grant? The Queensland Building Boost Grant (QBBG) is a grant of $10,000 for all Australian home buyers, investors, corporations or trustees buying or building a new home in Queensland valued at less than $600,000. The purpose of the QBBG is to assist the recovery of Queensland’s > Read More
