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December 31, 2007

Workplace relations changes transition

The new Commonwealth Government was elected only 1 month ago but there is a great deal of interest in its plans to change workplace laws.

According to a media release from the Deputy Prime Minister and Minister for Employment and Workplace Relations, Julia Gillard, the transition bill, which
is currently being drafted, will be introduced into the Parliament as a
matter of priority in the first sitting week of 2008.

The transition bill will, among other things:

  • prevent the making of new Australian Workplace Agreements;
  • create a new form of individual workplace agreement – the
    Interim Transitional Employment Agreement (ITEA) – to be available only
    for limited use during the transitional period;
  • remove the previous Liberal government’s Workplace Relations Fact Sheet requirements;
  • put in place a new no-disadvantage test for new agreements to provide better protection for employees; and
  • enable the Australian Industrial Relations Commission (AIRC) to undertake the process of modernising industrial awards.

Further information is contained in a transcript of an interview on 18 December. The key points are:

  • after the law is changed there will be no new Australian Workplace Agreements
  • existing AWAs stay for the balance of their term
  • under the new law, "our options could be to make a
    collective agreement with all of your staff to govern their terms and
    conditions, to make individual common law agreements but those common
    law agreements have to give people better than the safety net that is
    the significant difference with AWAs which can give you something worse
    than the safety net. Or for a two year period, there will be a
    transitional instrument called an Interim Transition Employment
    Agreement, an ITEA, that’s a statutory individual agreement but once
    again, unlike an AWA that has got to not disadvantage you compared with
    the safety net."
  • "there would be two pieces of
    legislation. The first bill, the one …
    that ends Australian Workplace Agreements, the ability to make new
    ones, that’s the transitional bill. It will be followed by a
    substantial piece of legislation. That substantial piece of legislation
    will deal with the whole of our new IR system. Now the system will come
    into full operation…on the first
    of January 2010. That’s when awards will be modernised, that’s when our
    new industrial umpire, Fair Work Australia will come into operation.
    Obviously that bill will deal with a number of matters including unfair
    dismissals. … What we want to have is a streamline
    system that works for everybody, that makes sure if a worker has a
    genuine complaint about their dismissal that gets heard and fixed but
    that people aren’t dragged away from their business that the complaint
    is dealt with quickly."

UPDATE 8 January 2008: Page 136 of The Parliamentary Library Briefing Book (pdf) contains a helpful summary of the proposed changes.

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Posted 31st December 2007 by David Jacobson in Business Planning

December 28, 2007

2007 business regulation in review

2007 ended with a "one in 10 year" change of federal government which in retrospect defined 2007 as a  year of policy reviews and proposals mixed in with marginal regulatory improvements and some significant court decisions.

Whilst 2008 is likely to bring substantive regulatory changes in the areas of commonwealth-state relations, business deregulation, climate change, freedom of information, tax reform and workplace relations, 2007 was a year of media releases in preparation for an election.

At the same time, regulators sought to show they were effectively implementing and enforcing their area of supervision.

What happened in 2007?

The Do Not Call Register started.

Anti-money laundering law implementation continued.

In financial services regulation, Basel II starts on 1 January 2008 after a long gestation period.

The Corporations Act was updated with the Simpler Regulatory System changes.

ASIC defended itself against criticisms of its performance of its consumer protection mandate and launched some major actions with mixed results. (Westpoint, Citigroup)

The ACCC had some successful cartel and price-fixing prosecutions (including Visy).

The Access Card proposal sank without a trace.

What are the "sleeper issues"?

Privacy and security of customer data (especially electronically stored information) and business integrity and ethics (eg AWB) are issues that will continue to trouble businesses.

I’ll continue this blog in 2008 with my RSS feeds, regular email newsletters and occasional podcasts. Thank you for reading.

NEW YEAR BONUS: 2007 has seen a few new Australian legal blogs…check them out here

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Posted 28th December 2007 by David Jacobson in Compliance

December 27, 2007

Elder financial abuse (or Financial Abuse of the Vulnerable Older Person)

BFSO Bulletin 56
(pdf) contains some excellent resources on elder financial abuse
focussing on the role that banks and other financial institutions can
play.

The purpose of the Bulletin is to provide information about
financial abuse and how to identify it – to assist in raising awareness
of the issue and to highlight some warning signs – and to put that
information in the context of the interaction between banks and other
financial institutions and their older customers.

It draws on the findings of Older People and the Law,
a Report of the House of Representatives Standing Committee on Legal
and Constitutional Affairs following its Inquiry into Older People and
the Law.

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Posted 27th December 2007 by David Jacobson in Financial Services

Resale price maintenance penalty: Navman

In Australian Competition and Consumer
Commission v Navman Australia Pty Ltd
[2007] FCA 2061,
the Federal Court imposed penalties totalling $1.36 million against
Navman Australia Pty Ltd and 2 of its officers as a result of a large
number of contraventions of the
resale price maintenance prohibition contained in s 48 of the Trade Practices
Act 1974
(Cth) .

A penalty of $1.25 million was imposed on Navman and penalties of $80
000 and $30 000 respectively were also imposed on Mr Christopher Baird,
a former director of Navman and the former Australasian sales manager
of Navman, Mr David King.

Navman engaged in extensive resale price maintenance over a period of more
than three years.  Its conduct extended to the supply of both marine equipment
and personal and in-car navigation (PCN) products. Its conduct in relation to the supply of marine equipment
covered the period from 2001 to 2004.  Its resale price maintenance conduct in
the supply of PCN products covered the period from 2003 to 2004.

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Posted 27th December 2007 by David Jacobson in Trade Practices

ASIC relief for foreign-controlled small proprietary companies

ASIC has made Class Order [CO 07/822] varying Class Order [CO 98/98] which provides relief to foreign-controlled small proprietary companies which are not part of a “large group” (as defined in the principal class order) from the requirement under paragraph 292(2)(b) of the Act to prepare and lodge audited financial reports and directors’ reports with ASIC.

The amending class order reduces the administrative burden on companies relying on the relief to lodge forms with ASIC every year. (Explanatory statement)

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Posted 27th December 2007 by David Jacobson in Corporations Act

December 26, 2007

Debenture advertising: ASIC Regulatory Guide 156

ASIC has released  Regulatory Guide 156: Debenture advertising (pdf).

ASIC will expect advertising by debenture issuers to comply with the guide from late January 2008 onwards.

The Guide sets out the following principles-based standards in relation to the advertising of debentures for issuers of debentures:

1. All advertisements for debentures offered to
retail investors should include a prominent statement to the effect
that investors risk losing some or all of their principal investment.

2. Advertisements for debentures should only quote
an interest rate if it is accompanied by prominent disclosure of either
the current credit rating for the debenture and what that means or
where to find this information or, where the debenture does not have a
rating, what this means.

3. Advertisements should state that the debenture is
not a bank deposit. They should also avoid the use of terms such as
‘secure’, ‘secured’ and ‘guaranteed’ and avoid the term ‘no fees’, as
these statements may convey a misleading impression as to the risk
profile of the debenture.

4. Advertisements for debentures should not state or imply that the investment is suitable for a particular class of investor.

5. Statements in advertisements for debentures should be consistent with the corresponding disclosures in the prospectus.

6. Statements made in response to inquiries are
subject to the same regulation regarding misleading and deceptive
conduct as the advertisements.

The guide also makes it clear that ASIC expects
publishers to have systems and controls to detect and refuse
advertisements for debentures that do not comply with these advertising
standards.

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Posted 26th December 2007 by David Jacobson in Corporations Act

ACCC to monitor green marketing claims

The ACCC is taking a closer look at a number of the green claims
that are being made. All businesses need to ensure
they are not misleading their customers with such claims.

Green marketing does not refers solely to the
promotion or advertising of products with environmental
characteristics. Green marketing claims, in the broader concept are now being
applied to consumer goods, industrial goods, services, corporate
activities.

The ACCC intends to ramp-up its green compliance activities with a
combination of business and consumer educative initiatives and targeted
enforcement action.

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Posted 26th December 2007 by David Jacobson in Trade Practices

APRA’s approach to the supervisory review process under Basel II

The
Australian Prudential Regulation Authority (APRA) has released an
information paper on its approach to the supervisory review process
under the new Basel II capital adequacy regime, known as the Basel II
Framework. This follows the release, on 30 November 2007, of the full
suite of prudential standards
that will give effect to the
implementation of Basel II in Australia.

The
supervisory review process, or Pillar 2, is one of three mutually
reinforcing pillars on which the Framework is based. The review process
is intended to ensure that locally incorporated authorised
deposit‑taking institutions (ADIs) have adequate capital to support all
the risks in their business and to encourage ADIs to develop and use
better risk management techniques in monitoring and managing their
risks.

The Basel II Framework will come into force in Australia on 1 January 2008.

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Posted 26th December 2007 by David Jacobson in Financial Services

December 23, 2007

AML Rules update

Austrac makes AML/CTF Rules dealing with operational implementation of the AML/CTF Act.

The current rules are:


Draft AML/CTF Rules

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Posted 23rd December 2007 by David Jacobson in Anti-money laundering

Standards of Ministerial Ethics

The Prime Minister has published the Standards of Ministerial Ethics (pdf) which set out his expectations of his Ministers and Parliamentary Secretaries.

"In several important aspects, the Standards will require Ministers to accept higher levels of conduct than has been the case in the past. In particular:
• Lobbyists will be required to register their details publicly on a Register of Lobbyists to be established by the Department of the Prime Minister and Cabinet before seeking access to Ministers or their offices;
• Ministers will be required to undertake that, when they leave office, they will not seek to have business dealings with members of the Government, the Public Service or the Defence Force on any matters that they dealt with in an official capacity in the preceding 18 months;
• Electoral fundraising at The Lodge and Kirribilli House will be prohibited;
• Ministers will be required to divest themselves of all shareholdings other than through investment vehicles such as broadly diversified superannuation funds or publicly listed managed or trust arrangements."

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Posted 23rd December 2007 by David Jacobson in Compliance