Corporate Law

What is an exclusive supply contract?

An exclusive supply contract (Exclusive Supply Contract), also known as Exclusive Dealing, occurs when one party trading with another imposes some form of restriction on the other’s freedom to choose with whom, in what, or where they deal.  Some examples of Exclusive Dealing may include:

  • the supplier being restricted to supplying the goods in a specific geographical area, or through a particular channel; or
  • restricting a purchaser from buying the same or similar goods from other suppliers.

This article outlines what an Exclusive Supply Contract or Exclusive Dealing is and when it may not be legal. [Read more…]

Software royalties and income tax

The Australian Taxation Office (ATO) recently released a draft Taxation Ruling (TR) 2021/D4 (Draft Ruling) which considers whether certain software related royalties may be taxable.  In short, the Draft Ruling provides a much needed, and quite broad, scope for when consideration of computer software will be a royalty for income tax purposes.  This article discusses this broadened scope. [Read more…]

Non-fungible tokens – the new way to own IP?

Non-fungible tokens (NFTs) have been making headlines recently for being sold at auction for enormous sums of money.  Business school drop-out turned American DJ, 3LAU, apparently sold his NFT collection just over a month ago for $11.6 million USD ($15 million AUD).[1]  Grimes, otherwise known as Claire Boucher, a prominent musician and partner to Tesla CEO, Elon Musk, sold multiple digital artworks amounting to a total of $6 million USD ($7.79 million AUD).[2]

So what are NFTs and how can they help you protect your intellectual property (IP)? [Read more…]

Shareholder oppression in equal ownership situations

When a company with two (2) or more directors who are equal shareholders with equal voting rights have a dispute, it often leaves the company in a deadlock.  It is common in these situations for one (1) director to attempt to assert that the other director has engaged in oppressive conduct under section 232 of the Corporations Act 2001 (Cth) (Act).  This article discusses shareholder oppression when both directors own equal share portions. [Read more…]

Deal fatigue in commercial contracts

Deal fatigue is surprisingly very common in commercial transactions in Australia because of the complexity of the law and the sheer volume of documentation that’s often required.  An unfortunate consequence can be that benefit of entering into the deal in the first place can be watered down to the extent that the deal becomes unpalatable.   This article will discuss the symptoms of deal fatigue and offer some tips on avoiding it.  This video offers a definition of precisely what deal fatigue is, how to recognise it and how you can try to avoid it.

Shareholder oppression – the early warning signs

Some of the early warning signs

  • The entity and its structure
  • Relationship with accountants and lawyers
  • Related contracts
  • Skills acquisition that causes redundancy
  • Exclusion from management
  • Access to information
  • Non-flexible negotiator

Shareholder oppression – a taxonomy of corporate wrongs

Shareholder oppression (Oppression) is the business battleground where equity holders fight for their share of the business’ equity value.  Unfortunately, it is all too common.  Oppressive conduct (Conduct) is broadly defined in section 232 of the Corporations Act 2001 (Cth) (Act) as when: [Read more…]

Are fiduciary duties owed by former directors?

Company directors owe various duties to their company and its shareholders.  For example, sections 180, 181, 182, 183 and 184 of the Corporations Act 2001 (Cth)(Act) impose statutory duties to exercise care and diligence, maintain good faith and refrain from using their position or information to gain an advantage for themselves.  However, the legislation, barring section 183, does not clearly express the extent to which these duties, as well as similar common law duties, continue to apply after a director has ceased being the director of a company.  Addressing this shortfall, the Court in Advanced Fuels Technology Pty Ltd v Blythe & Ors [2018] VSC 286 (Advanced Fuels) found that whether or not these duties endure after the cessation of a directorship depends on the facts and circumstances of each case. [Read more…]

What are the legal requirements of crowdfunding in business?

The Australian Securities and Investments Commission (ASIC) defines equity-based crowd-sourced funding (CSF) as:

… a company raising funds—usually through an online intermediary—from a large number of individual investors who make relatively small financial contributions to the company… [and] a fundraising option for start-ups or small to medium-sized companies.[1] [Read more…]

What is a Case Management Hearing?

In the Federal Court of Australia, a case management hearing is a meeting of the parties and the Court to identify issues at the earliest possible stage (Case Management Hearing).[1]  They are the essential element of, and main procedure used in achieving, case management.[2]  In Queensland Courts, they are referred to as case management conferences.[3]  Case Management Hearings may be referred to by different terms in each State.  This article discusses Case Management Hearings in the Federal Court. [Read more…]

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