上海高级律师杨春宝主持的网站群: 法律桥[导航] :: 会见律师网 :: 投资并购律师[导航] :: 创业与法律 :: 律师博客[导航] :: 法律论坛[导航] :: 法律网址[导航] :: Law Bridge [导航]
聘请专业律师直达快车: 法律顾问 :: 公司法律师 :: 投资律师 :: 房地产律师 :: 知识产权律师 :: 电信网络律师 :: 聘请律师热线:13901826830(杨春宝高级律师,咨询勿扰)
上海投资并购律师 法律桥(LawBridge.org)---中国最早、最有影响力的原创法律网站 ENGLISH
收藏本站
公司法首页
法律法规
案例精选
合同文本
法律问答
法律研究
服务动态
聘请律师
法律咨询
招商投资
法律搜索
最新法律文章
推荐法律文章
热门法律文章
相关法律文章
相关专题文章
法律桥(LawBridge.org)---中国最早、最有影响力的原创法律网站
您的位置:上海律师法律桥>>法律研究>>法律论文>>文章内容
 

Is the Corporations Law Still Too Complex? (澳洲公司法是否仍然过于繁琐?)

作者:杨春宝律师 来自:公司投资律师 时间:2005-2-17 21:19:23
您是本文第 位阅读者 【字体:放大 正常 缩小
若需聘请投资、并购律师,请立即致电杨春宝高级律师:1390 182 6830(咨询勿扰)
Because of constitutional constraints on the powers of the Commonwealth, companies legislation was regard as a state matter. Each state had its own Companies Act in the early times. With the market development, Australia tried to uniform the companies legislation through different methods including the Co-operative Scheme in 1980s and the Corporation Act 1989. But the latter was held unconstitutional by the High Court.(1) However, a special solution was finally introduced, after a special agreement was made between the Attorneys-General of Commonwealth and six states, the Corporations Law became operative on 1 January 1991. In order to make it more logic, many of the older laws were restructured into it, so it "is unique in the world in that it contains in a single statute the laws relating to companies, accounts, securities markets, takeovers and insolvency".(2) It became incredibly complex with 22 chapters, two schedules and 1,362 sections. In 1991, there were 892,749 companies, of which 10,402 were public companies and the number of the listed companies was only 1,096,(3) but the Corporations Law applied to all these 892,749 companies despite of Titanics or tiny sampans. It was absurd, as the former Chief Justice of the High Court of Australia, Sir Anthony Mason, said in 1992 that:

"Oscar Wilde?would have regarded our modern Corporations Law not only as uneatable, but also indigestible and incomprehensible".(4)

It was really in need of reform. As the reaction, the Labor Attorney-General established in 1993 a Corporations Law Simplification Task Force to introduce the Corporate Law Simplification Program which was replaced in May 1997 by Liberal Federal Treasurer's Corporate Law Economic Reform Program (CLERP). Both the two programs have made substantive changes to the Corporations Law. Is the Corporations Law still complex?

The objective of the Corporate Law Simplification Program was to render the Corporations Law "capable of being understood so that users can act on their rights and carry out their responsibilities".(5) Accordingly, the Simplification Task Force targeted seven priority areas including small business, share buy-backs, capital rules, annual reporting, registers, company names and meetings, and three components for simplification, that was simplification of content, clarification of drafting and comprehensive consultation. As to simplification of content, the plan was to streamline the Corporations Law, procure consistency and coherence, strip away unnecessary complexities, maintain effective protection for investors and bring cost benefits both to and to relevant authorities. As to clarification of drafting, the program adopted principles of plain English to meet the needs of a variety of types of users. The program also called for extensive consultation particularly with those most closely associated with its operation and administration.

As the first stage achievement of the Simplification Task Force, the First Corporate Law Simplification Act 1995 (Cth) (The Simplification Act) came into force on 9 December 1995. It effected substantial changes in three areas: proprietary companies, share buy-backs and company registers.

The highlight of the Simplification Act is the introduction of a "Small Business Guide" as Part 1.5 CL and it is also available as a separate publication. In 11 sections it clearly outlines central rules including the rights, obligations and duties for most small business. The Simplification Act also made annual general meetings optional, reduced accounting and financial reporting requirements, and single director companies and single member companies are allowed.

Share buy-backs provisions is simplified both in content and in drafting through the replacement Part 2.4 Division 4B. The Simplification Act allows a company to buy back its own shares (other than redeemable preference shares) if it follows the procedures laid down, and makes same rules apply to all types of companies. It also replaces mandatory procedures involving auditors, experts, advertisements and declarations of solvency with new safeguards. All these provisions are included in 11 sections with about 3,000 words, compared to old provisions that were consisting of 89 sections using more than 20,000 words.(6)

The Simplification Act abolished several company registers. It worked out uniform rules in one place for registers of members, option holders and debenture holders.

Before the Simplification Act was finally passed, the Second Corporate Law Simplification Bill has been released for public consultation. As the Federal Government was changed, the Second Corporate Law Simplification Bill was replaced with the Company Law Review Bill 1997 and was finally passed in late June 1998 as the Company Law Review Act 1998 (Cth) (CLRA98) and commenced on 1 July 1998. The objective of the CLRA98 is stated as "to improve the efficiency of corporate regulation, and reduce regulatory burdens on business and other users of the Corporations Law."(7)

The CLRA98 made significant changes to the Corporations Law. The need of drafting a constitution was abolished. Existing companies may choose to maintain their original memorandum and articles of association as their corporate constitution, or to adopt a new constitution or repeal the memorandum and apply to the replaceable rules. Companies registered after 1 July 1998 can choose whether or not adopt a corporate constitution. The replaceable rules apply to all new companies unless they are displaced or modified by the corporate constitution.

As to the share capital, the changes include that the par value for shares and the concept of authorised share capital are abolished, the need for court approval for capital reductions and the shareholders' approval for financial assistance are also removed, and a number of changes are made with respect to the procedures for the issuing of shares.

Other features include that the procedures for establishing, running and de-registering a company were simplified, electronic commerce is to be encouraged for meetings and lodging documents with ASIC, the need to hold formal meetings for proprietary company is reduced, and the size of annual returns and the costs of annual reports are reduced.

While the contents are changed, the drafting was also clarified with plain English; as a result, there was a 43% reduction in words (from 95,000 words to 54,000 words).(8)

As mentioned above, the Corporate Law Simplification Program was replaces by the CLERP following the change of the Federal Government. The objective of the CLERP was "to ensure that business regulation is consistent with promoting a strong and vibrant economy and provides a framework which assists business in adapting to change".(9)

Accordingly, the reforms of companies and securities regulation aimed to "facilitate a more efficient and competitive business environment".(10) "As part of the Coalition Government's drive to promote business and economic development",(11) the CLERP adopted an economic approach to corporate regulation. The key principles include market freedom, investor protection, information transparency, cost effectiveness, regulatory neutrality and flexibility, and business ethics and compliance. The main features of the reform agenda are summarised as follows:

1.facilitating corporate fundraising, including improving disclosure and facilitating fundraising by small and medium sized enterprises;
2.improving corporate governance, including clarifying directors' duties and greater accountability to shareholders;
3.making accounting standards more useful for business;
4.streamlining takeover rules, including mandatory bid, compulsory acquisitions, takeovers panel and listed managed investments;
5.fostering electronic commerce; and
6.streamlining regulation of financial markets and products.

After the CLERP has released seven Proposals, of which the first four were incorporated into the CLERP Bill, which was passed on 20 October 1999 as the CLERP Act, which commenced operation on 13 March 2000.

The CLERP Act made significant changes to the Corporations Law relating to directors' duties and corporate governance, fundraising, takeovers and accounting standards.

The most significant change relating to directors' duties and corporate governance is the introduction of a business judgement rule. There was uncertainty as to the personal liability of directors for decisions made in good faith before this change was made. Now directors will be assumed to have fulfilled their duty of care if they satisfied the pre-conditions. The ability of directors to delegate functions and to rely on the advice of others was also clarified. The rights of shareholders were also enhanced. Shareholders are allowed to bring proceedings on behalf of the company where the company is either unwilling or unable to do so.

As to takeover provisions, the CLERP Act makes the Corporations and Securities Panel the primary forum for the resolution of takeover disputes during the bid period and prohibits the parties from applying to the court. It allows all types of securities to be compulsorily acquired at any time. And it will be much easier for the holder of 90% or more of shares in a company to mop up the rest by compulsory acquisition. It is believed that changes will simplify takeovers, make them more certain and more commercial.

The most important amendment made to the fundraising provisions is the introduction of shorter prospectuses, which were traditionally long, complex and difficult to understand. The need to issue a prospectus for small business is also reduced. So, now it is simpler and cheaper for small business to raise corporate funds.

The changes of accounting standards are related to the Australian Securities and Investments Commission Act 1989.

From the overview of the main changes made to the Corporations Law during the last decade, we can conclude that the Corporate Law Simplification Program and the CLERP made different endeavour to change the Corporations Law, and accordingly they have the different impact to the Corporations Law.

The objective of the Corporate Law Simplification Program was to make the Corporations Law understandable, so it aimed to simplify both the content and the drafting. The Simplification Act was a good start of its planned endeavour. It made substantial changes to the law relating to proprietary companies, share buy-backs and company registers. The Second Corporate Law Simplification Bill was to continuously simplify the Corporations Law. Both of the two not only significantly simplified relevant requirements and procedures, but also dramatically reduced the words. In my opinion, the introduction of the "Small Business Guide" is one of the greatest achievements of the Corporate Law Simplification Program, and it is a wonderful model for simplifying the Corporations Law. Unfortunately, its endeavour to simplify the Corporations Law was suspended due to the change of Federal Government, although the Second Corporate Law Simplification Bill was mainly included in the CLRA 1998.

The CLERP has also made significant changes to the Corporations Law, but as it is "a major element of the Government's overall economic program",(12) all the modifications are aimed to promote efficiency in the Australian economy and increase the protection of investors. The simplification is one of the elements it concerned, but it is no longer its main objective. There is no doubt that CLERP Act has clarified directors' duties, and simplified the provisions of takeovers and fundraising, but simplification is only a by-product of efficiency.

By now, after more than a dozen of alterations, it seems that the Corporations Law is still unreasonable complex, even more complex than ever to some extent, although some endeavours have made to simplify it. There are 1493 numbered sections plus many inserted sections, the actual total number of sections are over 1,800, some of which are meaningless. There are also too many cross-references that are too far from clarity. Perhaps it is a good suggestion to divide the Corporations Law into several different acts apply to different companies, and to make further more endeavours to simplify each part when it is divided.

Footnotes:

1.NSW, SA & WA v Commonwealth of Australia (1990) 169 CLR 482; 1 ACSR 137
2.Adams, M A; "Developments in Australian and UK Corporate Law and Governance" (1998) 4 Corporate Governance International 22.
3.Adams, M A; Corporations, Finance and Securities Law, Class Materials 3.
4.Mason, Sir Anthony; "Corporate Law: The Challenge of Complexity" (1992) 2 Australian Journal of Corporate Law 1.
5.Attorney-Generals Department, Corporations Law Simplifications Program,Task Force, Plan of Action, Barton, ACT, 1993, 1.
6.Jenny Wily, Corporations Law Update - Simplification, Corporations Law:paper presented for the Continuing Legal Education Department of the College of Law on Wednesday,27th March 1996
7.Company Law Review Bill 1997 Explanatory Memorandum.
8.Adams, M A; Corporations, Finance and Securities Law, Class Materials 1.
9.CLERP, Policy Framework
10.CLERP, Policy Framework
11.CLERP, Policy Reforms
12.CLERP, Policy Framework

Bibliography:

1.Attorney-Generals Department, Corporations Law Simplifications
2.Program, Task Force, Plan of Action, Barton, ACT, 1993, 1;
3.CLERP, Policy Framework;
4.CLERP, Policy Reforms;
5.Company Law Review Bill 1997 Explanatory Memorandum;
6.CLERP, Commentary on Draft Provisions;
7.Adams, M A; Corporations, Finance and Securities Law, Class Materials;
8.Adams, M A; "Developments in Australian and UK Corporate Law and Governance",(1998) 4 Corporate Governance International 22;
9.Jennifer Hill; "CLERP: What it Means for Corporate Australia",(2000) 1 Australian Company Secretary 18;
10.Jenny Wily, "Corporations Law Update - Simplification" - paper presented for the Continuing Legal Education Department of the College of Law on Wednesday,27th March 1996;
11.Jenny Wily; "Recent Developments in the Corporations Law"- paper presented for the Continuing Legal Education Department of The College of Law on Wednesday,19th March 1997;
12.H A J Ford and I M Ramsay; A Guide to the First Corporate Law Simplification Act 1995 (Cth),Butterworths 1996;
13.David Roberts, "Company Law Review Act 1998" - paper presented on 16th September 1998;
14.David Wishart; "The Politicization of Corporate Law Reform"- paper presented at Corporate Law Teachers' Association Conference 1999 at Monash University;
15.Brian Burnett (Consultant author); 2000 Australian Corporations Law, CCH Australia Limited;
16.Latest CLERP changes good news for companies and fundraising, @ 2000, Freehill Hollingdale & Page, http://www.brw.com.au/specials/lawnotes/clerp.htm


(本文作者:杨春宝律师,来自:公司投资律师,引用及转载应注明作者与出处。 发表评论
关于“Is the Corporations Law Still Too Complex? (澳洲公司法是否仍然过于繁琐?)”,若需聘请公司法律师,请立即致电杨春宝高级律师:1390 182 6830(咨询勿扰)
 
关注法律桥微信公众平台 杨春宝高级律师电子名片
欢迎发表评论! 发表评论须知:
  • 请注意文明用语,请勿人身攻击。
  • 请尊重网上道德,遵守中华人民共和国各项相关法律法规。
  • 您应当对因您的行为而直接或间接导致的民事或刑事法律责任负责。
  • 请勿在此提出法律咨询,法律咨询请去法律桥论坛
  • 本站有权在网站内转载或引用您的评论。
  • 网站管理员有权删除违反上述提示的评论。
  • 参与本评论即表明您已经阅读并接受上述条款。
本站声明:
本站所载之法律论文、法律评论、案例、法律咨询等,除非另有注明,著作权人均为站长杨春宝高级律师本人。欢迎其他网站链接,但是,未经站长书面许可,不得擅自摘编、转载。引用及经许可转载时均应注明出处“投资并购律师”,并链接本站。本站网址:http://www.lawyerbridge.com/.

本站所有内容(包括法律咨询)仅供参考,不构成法律意见,站长不对资料的完整性和时效性负责。您在处理具体法律事务时,请洽询有资质的律师。本站将努力为广大网友提供更好的服务,但不对本站提供的任何免费服务作出正式的承诺。本站所载投稿文章,其言论不代表本站观点,如需使用,请与原作者联系,版权归原作者所有。

关于本站 | 版权隐私 | 联系律师 | 网站导航 | 网站地图 | 律师微博 | English | China Sites
投资并购律师 Since 2000,上海杨春宝高级律师 版权所有。欢迎链接,未经许可,不得转载、摘编
中国上海市银城中路501号上海中心大厦15层、16层 电话:1390 182 6830 ICP备案序号:沪ICP备05006663号
(谢绝推销!法律咨询请去本站法律论坛提出,本站不接受电话法律咨询,谢谢配合!)
关键字[公司法-外商投资-证券法-法律咨询-法律服务-法律顾问-外资并购-外资上市-境外上市-公司法案例-资产重组-国企改制-法律文本-公司律师]