Tag along rights in shareholders’ agreements

“Tag along rights” are rights that are commonly included in shareholders’ agreements. As the name suggests, tag along rights effectively empower minority shareholders to “tag along” with a majority shareholders’ (Seller) sale of shares to a third party (Third Party).  [Read more…]

Federal government outlines proposed crowdfunding rules

The Australian Treasury has today, 4 August 2015, released a consultation paper providing the first details of the impending legislative framework for crowd-sourced equity funding (CSEF) for public companies.  The introduction of a legislative framework for CSEF’s is part of the 2015-16 federal budget package. [Read more…]

Shareholders’ agreements and inconsistency clauses

The case of Cody v Live Board Holdings Limited [2014] NSWSC 78 (Cody) highlights the need for careful drafting of Shareholders’ Agreements to ensure that there is no duplication of clauses in company constitutions. Shareholders’ agreements usually contain what’s known as an “inconsistency clause”. Such inconsistency clauses attempt to resolve ambiguity between overlapping or conflicting clauses in Constitutions and Shareholders Agreement in favour of the Shareholders’ Agreement. Cody provides guidance on the applicability of inconsistency clauses.

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Shareholder oppression

What is shareholder oppression?

Shareholder oppression can occur when the majority shareholders in a company misuse their power to oppress the minority shareholders.

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Prohibition on the acquisition of a relevant interest

Section 606 of the Corporations Act 2001 (Cth) (Corps Act) contains a prima facie prohibition against the acquisition of relevant interests in voting shares.

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Redeemable Preference Shares

Last updated 22/08/2015
According to the Australian Securities and Investments Commission (ASIC) preference shares are shares that give holders some right or preference.

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What is a Corporate Governance Framework?

The term ‘corporate governance’ is often bandied about, but rarely explained in the context of a framework which can be applied to a variety of enterprise types.

So what is it?  Corporate governance is traditionally thought of as the way in which enterprises are directed and controlled.  More recently, corporate governance has been defined as the framework of rules and procedures by which the decisions in an enterprise are made, and how the controllers and held accountable for them.  The term, ‘enterprise’ refers to all types of associations, companies, trusts and other hybrid entities that provide a product or service (Enterprise).

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Criminal liability shifts away from company officers

The Personal Liability for Corporate Fault Reform Act 2012 (PLCFRA), assented to on 10 December 2012, was implemented in an effort to ensure that personal criminal liability for corporate fault is imposed in accordance with the principles of good corporate governance.

Prior to the PLCFRA, company secretaries and directors were made criminally liable for the acts of the corporation in which they served.

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Why do we need a Privacy Act Compliance Audit (PACA)?

What is a Privacy Act compliance audit?

Businesses have responsibilities pursuant to the Privacy Act 1988 (Cth) (Privacy Act) to make sure that they comply with the ten (10) National Privacy Principles (NPP) in accordance with the Privacy Act.

A Privacy Act Compliance Audit (PACA) is a threshold assessment that assists an organisation to determine whether or not they are compliant with the Privacy Act.  Further, a PACA can provide an organisation with practical go forward methodologies about the way that they collect, hold, use and disclose an individual’s personal information.

At present businesses are preparing to review their processes as legislative amendments come into force in March 2014.  At this time, further obligations will be imposed by the Privacy Act.  This means that they must adhere to a new set of privacy principles called the Australian Privacy Principles (APPs).  Read a summary of the changes here. [Read more…]

Is your ACN on all your public documents?

In Australia every company is issued with a unique, nine-digit number known asan Australian Company Number (ACN).  The ACN must appear on all public documents.  The purpose of the ACN is to ensure that companies are identified when conducting business transactions.[1]  On registration, new companies are issued with an ACN by the Australian Securities & Investments Commission (ASIC).[2]

Section 153 of the Corporations Act 2001 (Cth) (Act) provides that a company must set out its name and ACN on all its public documents and negotiable instruments.

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