REGULATORY AUTHORITIES
ASX
Submission To ASIC On Proposed Multiple Market Operator Regime
The ASX has submitted a response to ASIC's Consultation Paper 95 Competition for market services - response to CP 86 and further consultation (CP 95). CP 95 was issued in response to applications lodged with ASIC by AXE ECN Pty Ltd (AXE) and Liquidnet Australia Pty Ltd (Liquidnet) for Australian market licenses to operate competing trading venues for ASX-listed securities.
The ASX submission considers a number of issues in relation to CP 95 including:
- investor protection
- self-regulation of market participants
- legal issues arising from ASIC's proposal for licenses to be granted to a reporting facility prior to it operating as a trading facility and
- changes to legislation required to address gaps in the current regulatory framework to sustain a multiple market operator environment.
The ASX submission can be accessed via the following link:
http://www.asx.com.au/about/pdf/ASX_submission_to_CP_95_Public_Consultation.pdf
CP 95 can be accessed via the following link:
Non-Voting Ordinary Shares - Discussion Paper Released
The ASX has released a public consultation paper in relation to non-voting ordinary shares. The paper puts forward a proposal to alter the listing-rules to allow quotation of non-voting ordinary shares, subject to certain safeguards.
The paper makes clear that the ASX has not formed a definite view on the proposal but has identified a need for review, particularly given developments in comparable overseas exchanges, many of which provide market access to non-voting ordinary shares.
Submission are due by 7 March 2008.
The ASX consultation paper can be accessed via the following link:
http://www.asx.com.au/about/pdf/non_voting_shares_public_consultation.pdf
ACCC
Draft Legislation Criminalising Serious Cartel Conduct
The Australian Government has released an exposure draft of the legislation to criminalise serious cartel conduct. If adopted, it will be a criminal offence to make, or give effect to, a contract, arrangement or understanding that contains a 'cartel provision' (ie, a provision that fixes prices, restricts outputs, allocates customers, suppliers or geographical areas or rigs bids between competitors) with the intention of dishonestly obtaining a benefit.
The proposed maximum punishment for such offences is: for individuals, five years imprisonment and a fine of $220,000;and, for corporations, the greater of $10 million, three times the value of the benefit from the cartel or, where the value cannot be determined, 10% of annual turnover. The draft legislation also creates equivalent civil offences for which dishonesty does not have to be proven.
Although prosecution of the new offences will be undertaken by the Director of Public Prosecutions (DPP) rather than the ACCC, a draft memorandum of understanding (MoU) between the DPP and the ACCC provides that the DPP will decide whether or not to commence criminal proceedings in accordance with Commonwealth policies and the recommendations of the ACCC. The ACCC may recommend the DPP not to commence proceedings if the offender meets the criteria in the ACCC's immunity policy.
The Government has also released a discussion paper in relation to the proposed legislation, which seeks input on whether dishonesty is an appropriate distinction between the criminal and civil offences, and whether telephone interception powers should be available to assist in the investigation of the proposed criminal offences. Submissions from interested partied are due by 29 February 2008. The draft legislation can be accessed via the following link:
http://www.treasury.gov.au/documents/1330/PDF/Attachment_A_cartels_Exposure_draftbill.pdf
The MoU between the DPP and ACCC can be accessed via the following link:
http://www.treasury.gov.au/documents/1330/PDF/Draft%20ACCC%20DPP%20MOU%2008008.pdf
The Government discussion paper can be accessed via the following link:
http://www.treasury.gov.au/documents/1330/PDF/Cartels_Bill_Discussion_paper.pdf
Carbon Offset Claims Issues Paper
The ACCC has released an issues paper titled The Trade Practices Act and Carbon Offset Claims, which is intended to initiate consultations designed to provide guidance to consumers and businesses on claims made about carbon offsetting.
The issues paper comes in response to concerns about the growing number of marketing claims made about carbon offsetting, for example, in the marketing of cars, flights and household goods and services. The ACCC is particularly focusing on the potential for misleading or deceptive conduct given that consumers find it difficult to understand and verify such claims.
Submissions in response to the issues paper are due by 15 February 2008.
The issues paper can be accessed via the following link:
TAKEOVERS PANEL
Interim Orders – Golden West Resources Limited 03 & 04
On 1 February 2008, the Takeovers Panel made interim orders on applications from Golden West Resources Limited (GWR) and Falak Holding LLC (Falak) in relation to the affairs of GWR. The applications from GWR and Falak pertain to a mistaken acceptance of Fairstar Resources Limited's (Fairstar) takeover offer for GWR by an agent of Falak, ANZ Nominees Limited (ANZ). Falak has a 7.98% holding in GWR.
Both GWR and Falak claim that the disputed acceptance gives rise to unacceptable circumstances, but at this stage only Falak has declared its intention to seek final orders reversing the legal effect of its mistaken acceptance.
Falak is reportedly conducting an investigation to determine how the mistake occurred.
The Takeover Panel's release in relation to the interim orders can be accessed via the following link:
http://www.takeovers.gov.au/display.asp?ContentID=1341
CASES
High Court Publishes Its Reasons For Judgment In Alinta Litigation
On 31 January 2008, the High Court (Court) published its reasons for judgment in the matter of Attorney-General (Cth) v Alinta Limited [2008] HCA 2.
On 13 December last year, the Court unanimously held that the Takeovers Panel (Panel) in exercising its powers and fulfilling the functions conferred upon it by the Corporations Act 2001No. 50 (Cth) (Act) does not exercise the judicial power of the Commonwealth. The Court held that when declaring circumstances pertaining to the affairs of a company to be unacceptable circumstances, the Panel undertakes the non-judicial function of considering policy considerations relevant to the public interest.
A full copy of the Court's decision can be accessed via the following link:
http://www.austlii.edu.au/au/cases/cth/HCA/2008/2.html
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