Australia: Corporate Law News - September 2007

ASIC has published a consultation paper proposing benchmarks and increased disclosure by issuers of unlisted and unrated debentures.

Consultation Paper 89: Unlisted, unrated debentures – improving disclosure for retail investors outlines the new disclosure obligations for debenture issuers, which require them to report against ASIC determined benchmarks and justify any departures from these benchmarks.

The paper also proposes advertising restrictions for unlisted and unrated debentures in relation to them being described as 'safe' or 'secure', and that advertisements should warn consumers they risk losing their total capital when investing in these types of financial products.

Consultation Paper 89: Unlisted, unrated debentures – improving disclosure for retail investors can be accessed via the following link:
http://www.asic.gov.au/asic/pdflib.nsf/LookupByFileName/CP_89_Unlisted,%20un rated%20debentures.pdf/$file/CP_89_Unlisted,%20unrated%20debentures.pdf

APRA

As part of its response to recommendations made in the HIH Royal Commission, APRA has released a discussion paper proposing reduced reporting requirements for consolidated general insurance groups.

Consolidated Group Reporting for General Insurers proposes consolidated reporting requirements that are less onerous, and less frequent, than the reporting obligations imposed upon individual group members. The requirements aim to ensure APRA is provided with adequate information to supervise the capital adequacy of general insurance groups, without placing an unnecessarily high reporting burden on such consolidated groups.

Submissions on the discussion paper are invited and must be received by 12 October 2007.

Consolidated Group Reporting for General Insurers can be accessed via the following link:
http://www.apra.gov.au/Policy/upload/Discussion-paper-Consolidated-Group- Reporting-for-General-Insurers.pdf

Basel II reporting standards for ADIs

APRA has released a prudential package including a discussion paper, draft reporting standards, forms and instructions for authorised deposit-taking institutions (ADIs).

The package represents one of the final stages of APRA's implementation of the Basel II prudential framework, and covers the calculation of minimum capital for credit risk, operational risk, market risk and interest rate risk in the banking book.

Submissions on the prudential package are invited and must be received by 5 October 2007.

The documents contained in the prudential package can be accessed via the following link:
http://www.apra.gov.au/ADI/Basel-II-implementation-in-Australia.cfm

ASX has released a consultation paper on the proposed renaming of two of its indices. The S&P/ASX 200 Property Trusts index will be renamed as the S&P/ASX 200 A-REIT index, and the S&P/ASX 200 Financial-x-Property Trusts index will become the S&P/ASX 200 Financial-x-A-REIT index. The changes bring the branding of 'Listed Property Trusts' in line with "international best practice".

Submissions on the consultation paper are invited and must be received by 5 October 2007.

Proposal for the Renaming of Two Indices can be accessed via the following link:
http://www.asx.com.au/research/pdf/consultation_renaming_property_indices.pdf

On 21 August 2007, the ACCC instituted proceedings in the Federal Court against the ANZ Bank, alleging that ANZ breached section 45 of the Trade Practices Act No. 51 1974 (Cth) in seeking to limit the level of refund that a mortgage broker could provide to customers in respect of ANZ home loans.

Mortgage Refunds, a mortgage broker, refunded to its customers part of the commission it received from lending institutions including ANZ. The ACCC alleges that ANZ sought to reach an agreement with Mortgage Refunds to limit the amount of any refund the broker could provide to customers who took out home loans from ANZ through Mortgage Refunds.

The ACCC is seeking penalties and an order for costs against ANZ, a declaration that ANZ contravened the price fixing provisions of the Trade Practices Act and an injunction to restrain ANZ from entering into similar arrangements.
http://www.accc.gov.au/content/index.phtml/itemId/796530/fromItemId/2332w.accc.gov.au/content/index.phtml/itemId/796379/fromItemId/2332

The Senate has released a report containing the results of its inquiry into the impact of private equity investment on Australian capital markets and the economy.

The inquiry covered:

• the possible consequences for the Australian economy if the ownership, debt/equity and risk profiles of Australian companies are significantly changed by private equity investment;

• how private equity growth may affect taxation revenue;

• whether there is sufficient regulation to protect national economic and strategic interests in relation to private equity transactions; and

• whether other legislation is required to more effectively regulate private equity investment.

The majority of the Senate committee concluded that private equity investment is adequately regulated by current legislation, and supervised by agencies including ASIC, ACCC and FIRB.

Private equity investment in Australia can be accessed via the following link:
http://www.aph.gov.au/senate/committee/economics_ctte/private_equity/report/report.pdf

Consolidated Minerals Limited – unacceptable circumstances The Takeovers Panel (Panel) has made a declaration of unacceptable circumstances in relation to the affairs of Consolidated Minerals Limited (CML).

CML was the subject of takeover bid by Territory Resources Limited (TRL). The Panel considered that ambiguous and unsupported statements made by TRL, and its Chairman, during the takeover process 'were likely to affect the efficient, competitive and informed market' for CML shares. The Panel consequently held that TRL's actions constituted unacceptable circumstances.

The Panel's decision can be accessed via the following link:
http://www.takeovers.gov.au/content/1260/download/MR07-59.pdf

The Panel has now published its reasons for declining to commence proceedings in relation to the affairs of Accent Resources Limited.

The Panel’s reasons can be accessed via the following link:
http://www.takeovers.gov.au/content/1262/download/Accent_Resources_Limited.pdf

The Panel has now published its reasons for declining to commence proceedings in relation to the affairs of Becker Group Limited.

The Panel’s reasons can be accessed via the following link:
http://www.takeovers.gov.au/content/1264/download/Becker_Group_Limited_02.pdf

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