Corporate Law

Software patent allowed for tracking user action

In the recent case of Facebook, Inc. [2020] APO 19 (Facebook Inc.), the Patent’s office considered whether software that tracks the installation of applications on mobile devices following interactions with advertisements qualifies as a manner of manufacture and is therefore patentable subject matter. [Read more…]

Director’s identification numbers to become a reality

On 12th June 2020, the Treasury Laws Amendment (Registries Modernisation and Other Measures) Act 2020 introduced the requirement for all Australian company directors to have a “Director Identification Number” (DIN).  The DIN will become a single identifier for each director across all of their office holdings with the true identity of each director is verified and is consistent across of ASIC’s corporate records.   The scheme will ultimately applies to Australian body corporates, Aboriginal and Torres Strait Islander corporations, and registered foreign companies. [Read more…]

Division 7A ITTA 1936 (Cth) – compliance & consequences

Division 7 (sections 102V to 109ZE) of the Income Tax Assessment Act 1936 (Cth) (Tax Act) contains specific requirements for advances of moneys and loans between private companies and its shareholders or associates.  Section 109B of the Act describes three (3) classes of payments which will be deemed to be dividends: [Read more…]

What is a section 293 direction?

There are several reasons why a shareholder may require financial information, primarily they are denied access to the ‘accounts’ so as to make informed decision about the company.  The Corporations Act 2001 (Cth) (Act) provides various mechanisms for shareholders to obtain financial and accounting information about a company, to allow them to access full and complete information about the financial circumstances of the company that they hold shares in.  One such mechanism is referred to as a section 293 shareholder direction, which compels companies to provide requested financial reports as defined by section 293. [Read more…]

Director misappropriating funds found to be oppressive

Shareholder oppression usually occurs when a majority shareholder(s) misuses their power to oppress the minority shareholder(s).   The test for “oppression” is an objective one and is contained in Section 232 of the Corporations Act 2001 (Cth) (Act).   For instance, where a director is found to have breached their fiduciary duty because they have misappropriated funds or assets this can be considered as being oppressive conduct.  This was the case in Martin v Australian Squash Club Pty Ltd (1996) 14 ACLC 452 (Martin) when an executive director misappropriated and misused company funds and assets and was held to have breached his fiduciary duties. [Read more…]

Electronic execution of documents by directors

Because of the current COVID-19 restrictions, it has been inconvenient and even impossible (in some cases) for directors to sign documents in what’s known as “wet-ink”.  In order to address this issue the Corporations (Coronavirus Economic Response) Determination (No. 1) 2020 (Cth) (Determination) has been published by the Federal Government.  The Determination modifies the operation of section 127 of the Corporations Act 2001 (Cth) (Act) and other legislation in relation to the conduct of meetings and the execution of documents by companies.  The meaning of “Document” has been amended to include a document’ in electronic form. [Read more…]

Relief for companies during COVID-19

On 24 March 2020, the Federal Government passed the Coronavirus Economic Response Package Omnibus Act 2020 (Cth) (Act).  As a part of the Act, insolvency and corporations laws have been temporarily amended in light of the financial challenges businesses are facing in the wake of COVID-19.  The changes made are intended to avoid unnecessary insolvencies and bankruptcies by providing a safety net for companies and their directors during the pandemic.  This article will discuss the key changes. [Read more…]

The new business as usual in 2020!

It’s perhaps an understatement to say that the last few for Australian business has been unprecedented.  How can any business plan adequately consider and cater for a global pandemic and mass business shutdowns?  Extraordinary seems to be the new business as usual (BAU) in 2020! [Read more…]

New Fair Work information statement

In December 2019, the Fair Work Ombudsman updated the Fair Work Information Statement (FWIS).  The new FWIS sets out information for businesses about the conditions of employment for new employees.  Businesses must issue a copy of the FWIS to all new employees before, or as soon as possible after, they commence employment.  This article discusses the FWIS key changes for 2020. [Read more…]

Insolvent trading – prison for former Kleenmaid director

Founded in 1980, whitegoods importer and distributor Kleenmaid (Company) fell into administration in 2009 with debts amounting to approximately $96 million, including $26 million in customer deposits that had been paid for appliances yet to be delivered.  After an extensive investigation and 59-day trial by the Australian Securities and Investment Commission (ASIC), founder and former director Mr. Andrew Young (Mr. Young) was sentenced to nine years in jail for offences arising from the Company’s collapse. [Read more…]

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