The treatment of employee priority in a deed of company arrangement

This article examines one of the changes implemented in the Corporations Amendment (Insolvency) Act 2007 (Cth) . It is argued that the insertion of s 444DA raises some matters that go to the nature of the insolvency process generally and the operation of Pt 5.3A in a particular. The position of employees in insolvency is a matter that is the subject of much comment from a policy perspective. This article does not cover that debate but provides some initial explanation of the need to protect employees. The second part of the article covers the particular background to the voluntary administration system as far as employee rights are concerned as well as the arguments put forward by the government to justify the change in the legislation which inserted s 444DA . It suggests that there was little evidence provided for the need to protect employee priority rights in this particular way. An alternative explanation is given for the change adopted by the government. The third part of the article suggests that the manner in which the legislation seeks to better protect employee creditors is somewhat clumsy in its operation. It raises a number of questions about how the legislation may operate and argues that given the stated aims, some alteration to it would improve its effectiveness.

Regulating the cost of small loans : overdue or overkill?

Small-amount short-term lending began in 1994 in response to the initial exemption of such loans from consumer credit regulation. Growing demand for such loans now produces industry turnover of approximately $800 million each year. Regulators recognised early the need for consumer protection due to the vulnerability of borrowers and the emergence of various predatory practices. This led to reforms designed to regulate these loans, prevent particular misconduct and provide remedies against injustice. Some were enacted as part of the National Consumer Credit Protection Act 2009 (Cth), which also imposed licensing and responsible lending requirements on lenders and increased consumer access to remedies. The Government has now introduced the Consumer Credit and Corporations Amendment (Enhancements) Bill 2011 which limits the price that can be charged for credit and restricts access to small loans. This article examines the extensive reforms which have taken place in this sector, and compares these regulatory approaches with the “bright line approach” of the Enhancements Bill. The article argues that the repercussions of this step will require careful monitoring to ensure that further harm is not suffered by those least able to bear it, and that the government will also need to facilitate other, more sustainable, solutions to the problem that small loans are currently used to solve. After we wrote this article, the Report of the Parliamentary Joint Committee on Corporations and Financial Services and the Report of the Senate Economics Legislation Committee on the Enhancements Bill were released. These are referred to in a postscript.

The effectiveness of the best interests duty : enhancing consumer protection?

This article considers the uncertainty surrounding the scope of the best interests duty which forms part of the Government’s Future of Financial Advice (FOFA) reforms. It is likely to be many years before the courts can interpret and clarify the content of the duty. Under the new regime, the provision of personal financial advice will be made more difficult, complex and costly and these costs will be passed on to consumers. The article also considers whether there will still be scope for delivering standardized, non-tailored advice in the light of the best interests duty. In the pas standardized advice has allowed large amounts of low-level, generic advice to be delivered very efficiently. In order to avoid breaching the best interests duty standardized advice should only be used rarely, and only after a careful assessment has been made to ensure that a standardized approach is appropriate.

Analyzing the prevalence of sports-related terms among the web sites of global corporations

This research investigates the prevalence of sports-related terms among the Web sites of the world’s leading companies, the Fortune Global 500. An automated process copied about four gigabytes of textual data, around 70 million words, from their sites. The subsequent analysis revealed regional and industry differences in the distribution of sports-related terms, the popularity of tennis stars and few references to sports stars, especially in Asia.

Regulating Multi-National Corporations Through State-Based Laws : Problems with Enforcing Human Rights Under The Alien Tort Statute

Under the Alien Tort Statute United States of America (“America”) Federal Courts have the jurisdiction to hear claims for civil wrongs, committed against non-American citizens, which were perpetrated outside America’s national borders. The operation of this law has confronted American Federal Courts with difficulties on how to manage conflicts between American executive foreign policy and judicial interpretations of international law. Courts began to pass judgment over conduct which was approved by foreign governments. Then in 2005 the American Supreme Court wound back the scope of the Alien Tort Statute. This article will review the problems with the expansion of the Alien Tort Statute and the reasons for its subsequent narrowing.

Transnational business masculinities : media representations of gender and management in global mining corporations

This paper examines Australian media representations of the male managers of two global mining corporations, Rio Tinto and BHP Billiton. These organizations are transnational (or multinational) corporations with assets and/or operations across national boundaries (Dunning and Lundan, 2008), and indeed their respective Chief Executive Officers, Tom Albanese and Marius Kloppers are two of the most economically (and arguably politically) powerful in the world overseeing 37 000 and 39 000 employees internationally. With a 2008 profit of US$15.962 billion and assets of US$ 75.889 Billion BHP Billiton is the world's largest mining company. In terms of its profits and assets Rio Tinto ranks fourth in the world, but with operations in six countries (mainly Canada and Australia) and a 2008 profit of US$10.3 billion it is also emblematic of the transnational in that its ‘budget is larger than that of all but a few nations’ (Giddens, 2003, p. 62).

Effect of biochar amendment on the soil-atmosphere exchange of greenhouse gases from an intensive subtropical pasture in northern New South Wales, Australia

We assessed the effect of biochar incorporation into the soil on the soil-atmosphere exchange of the greenhouse gases (GHG) from an intensive subtropical pasture. For this, we measured N2O, CH4 and CO2 emissions with high temporal resolution from April to June 2009 in an existing factorial experiment where cattle feedlot biochar had been applied at 10 t ha-1 in November 2006. Over the whole measurement period, significant emissions of N2O and CO2 were observed, whereas a net uptake of CH4 was measured. N2O emissions were found to be highly episodic with one major emission pulse (up to 502 µg N2O-N m-2 h 1) following heavy rainfall. There was no significant difference in the net flux of GHGs from the biochar amended vs. the control plots. Our results demonstrate that intensively managed subtropical pastures on ferrosols in northern New South Wales of Australia can be a significant source of GHG. Our hypothesis that the application of biochar would lead to a reduction in emissions of GHG from soils was not supported in this field assessment. Additional studies with longer observation periods are needed to clarify the long term effect of biochar amendment on soil microbial processes and the emission of GHGs under field conditions.

Seen but not heard? The significance of shareholders under Pt 5.3A of the Corporations Act

The article considers the interests of company members as stakeholders in the event of a company entering voluntary administration and suggests that while shareholders hold a residual interest, they nonetheless have an interest in ensuring that that the company is rescued and perhaps therefore have a role to play in the rescue of the company’s business. In doing so it argues that there is some inconsistency in recent changes in Ch 5 regarding the role of shareholders with some changes recognising their role while others have sought to downplay it.

The application of the statutory derivative action in Pt 2F.1A of the Corporations Act to companies in liquidation under Ch 5 : Well oiled machine or is Pt 2F.1A in need of a tune up?

The statutory derivative action was introduced in Australia in 2000. This right of action has been debated in the literature and introduced in a number of other jurisdictions as well. However, it is by no means clear that all issues have been resolved despite its operation in Australia for over 10 years. This article considers the application of Pt 2F.1A of the Corporations Act to companies in liquidation under Ch 5. It demonstrates that the application involves consideration of not only proper statutory interpretation but also policy matters around the role and the supervision by the court of a liquidator once a company has entered liquidation.

Actions for declaratory or injunctive relief by the Corporate Regulator under s 471B of the Corporations Act

This article by Ben McEniery discusses the matters a court will consider when leave to commence or proceed against a company in liquidation is sought not by a creditor seeking to prove a debt, but by the corporate regulator pursuing declaratory or injunctive relief.