Research

Negotiated Enforcement: Regulatory Power and Corporate Misconduct in the Financial Sector

Type of grant: Australian Research Council Discovery Grant

Funds allocated: $311,000

Year grant obtained: 2018

Project Summary: Enforcement outcomes are often the result of negotiations between regulators and alleged wrongdoers. These negotiations may, for example, result in the regulator not pursuing litigation against the alleged wrongdoer and, in return for acknowledging past misconduct and some form of promise in relation to future conduct, the alleged wrongdoer receives a reduced sanction. Regulators rely on negotiations with alleged wrongdoers to respond to misconduct, impose sanctions and promote responsible behaviour. However, there is concern about the increasing preference of regulators to use negotiated enforcement rather than litigation to counter serious misconduct in the financial sector. An over reliance on negotiated enforcement raises concern where these practices: lack transparency; are inefficient; fail to deter misbehaviour; and operate to subvert individual justice. This project evaluates these issues by examining enforcement strategies by the Australian Securities and Investments Commission (ASIC) that involve negotiations with alleged wrongdoers and the factors that are relevant to ASIC when it pursues negotiations.

Researchers: Professor Ian Ramsay (Chief Investigator) and Dr George Gilligan (Research Fellow)

Restoring public trust in charities – reforming governance and enforcement

Type of Grant: Australian Research Council Discovery Early Career Researcher Award

Funds allocated: $401,980

Year Grant Obtained: 2018

Project Summary: This project aims to undertake a comprehensive and comparative investigation of governance and enforcement in the charitable sector in Australia. Public trust in the charitable sector has been damaged by governance failures, particularly in religious contexts, exacerbated by the sector’s complex and incoherent governance system. As yet, there has been limited academic consideration or empirical analysis of the effectiveness of the governance and regulatory framework of the sector or concrete reform proposals. This project aims to undertake comparative analysis and empirical research of these aspects, and to develop proposals for effective law and policy reform. This is expected to strengthen and maximise the sector’s capacity to contribute to the social and economic life in Australia.

Researchers: Associate Professor Rosemary Teele Langford

Financial Exclusion, Poor Insurer Practices and Consumer Protection

Type of grant: Australian Research Council Discovery Grant

Funds allocated: $358,916

Year grant obtained: 2017

Project summary: General insurance encompasses three products — building, home contents and motor vehicle insurance — that are considered essential to financial inclusion in Australia. General insurance also includes more controversial products such as add-on insurance and extended warranties. This project is Australia’s first large-scale empirical study examining financial exclusion and lack of access to general insurance, as well as poor insurer practices in selling insurance and handling claims. Through surveys, focus groups and interviews, the project also aims to evaluate the effectiveness of the legal protections for consumers of general insurance.

Researchers: Professor Ian Ramsay (Melbourne Law School), Associate Professor Paul Ali (Melbourne Law School) and Evgenia Bourova (Melbourne Law School)

Directors' Liability for Insolvent Trading in Australia: Reflections on Recent Reforms From Experience in Singapore and Japan

Type of grant: Melbourne Law School International Collaboration Fund

Funds allocated: $9,110

Year grant obtained: 2017

Project summary: This project will compare approaches to director liability in an insolvency context in Australia, Singapore and Japan. A director may be liable in Australia if a company of which she or he is a director incurs a debt when it is insolvent, or becomes insolvent by incurring that debt, and there are reasonable grounds for suspecting that the company was insolvent, or would become insolvent (Corporations Act 2001, section 588G). Recently, the Australian government proposed amendments to the statutory provisions imposing liability for insolvent trading by directors. The project will evaluate the approaches to director liability when a company is insolvent in the three countries in light of the proposed reforms.

Researchers: Professor Ian Ramsay (Melbourne Law School), Associate Professor Stacey Steele (Melbourne Law School), Associate Professor Meng Seng Wee (National University of Singapore Law)

Harmful Financial Products: Analysis of Their Impact and Regulation

Type of grant: Australian Research Council Linkage Grant

Funds allocated: $620,000

Year grant obtained: 2016

Project summary: This project will investigate financial products that have the potential to harm disadvantaged and vulnerable consumers. Working in partnership with five leading non-profit organisations, and adopting empirical research techniques (including surveys, interviews and focus groups), it will explore the extent to which these products perpetuate financial hardship, poor health and social disadvantage. In doing so, it will make a significant, original contribution to consumer law scholarship and studies of financial exclusion, while also providing practical assistance to policymakers, regulators and the partner organisations. The project will assess the need for law reform, and, if appropriate, will make detailed law reform recommendations.

Researchers: Associate Professor Paul Ali (Melbourne Law School), Professor Ian Ramsay (Melbourne Law School), Partner organisations: Consumer Action Law Centre, Financial Counselling Australia, Good Shepherd Australia New Zealand, Mallee Family Care Inc, Western Community Legal Centre

Comparative Insolvency Law in the Asia-Pacific

Type of grant: Melbourne Law School International Collaboration Fund

Funds allocated: $9,735

Year grant obtained: 2016

Project Summary: This project will focus on Chinese Insolvency Law, building on a long-standing collaboration between Associate Professor Jin Chun and Associate Professor Stacey Steele.  It will facilitate further collaboration, allowing Associate Professor Chun and Associate Professor Steele to conduct further research into Asian Insolvency Law.

Researchers: Associate Professor Stacey Steele (Melbourne Law School) and Associate Professor Jin Chun (Doshisha University, Japan)

Integrity in Sport: Comparative Approaches to Match-Fixing in Australia, Japan and Korea

Type of grant: Melbourne Law School Asia Research Collaboration Funding Scheme

Funds allocated: $9,000

Year grant obtained: 2016

Project Summary: This project by the Asian Law Centre and Sports Law Program at Melbourne Law School takes the form of a multi‐contributor book which examines approaches to combatting match‐fixing in Australia, Japan and South Korea. The book is part of the Asian Law Centre and Sports Law Program’s efforts to engage with Asian academics, regulators and law enforcement bodies to achieve a greater understanding of match-fixing and the current level of legal response in these key Asian sporting nations.  It builds on the papers presented at the Sports Law and Integrity Workshop in February 2015.

Researchers: Associate Professor Stacey Steele and Mr Hayden Opie (Melbourne Law School) and Dr Kee Young Yuen (Dongguk University, Republic of Korea) and Dr Young Ryuel Chung (Korea University)

Director's Conflicts: Multiple Directorships and Corporate Opportunities

Type of grant: University of Melbourne Early Career Researcher Grant

Funds allocated: $19,320

Project summary: Directors’ conflicts of interest constitute a fundamentally important governance issue both nationally and internationally. As the complexity of commercial transactions and of commercial life in general increases, the application of the conflicts duty has necessarily become more complicated. At the same time there is a constant tension between ensuring accountability and encouraging high quality candidates. Two particular contexts in which the application of the conflicts duty to directors is problematic and uncertain concern multiple directorships (where directors sit on the board of more than one company) and the pursuit in personal capacity of corporate opportunities ( opportunities which arise as a result of a director’s position or which are relevant to the company’s business). Questions persist as to the wisdom of allowing directors to sit on the board of multiple companies, particularly when those companies compete with each other. Questions also remain as to how removed an opportunity must be from a director’s position and the company’s line of business before it can be freely pursued. These issues transcend international boundaries and face regulators in many jurisdictions.

This project, which forms part of a broader comparative research agenda on directors’ duties, has as its focus the duty of directors to avoid conflicts of interest. The project involves empirical analysis of the frequency of directors holding more than one directorship in both Australia and England (in order to demonstrate the significance of the issue). It then seeks to provide guidance in relation to regulation of such multiple directorships and also in relation to the pursuit of corporate opportunities by directors – when can directors take up opportunities arising from their position or relevant to the company’s line of business? The ultimate aim of the project is to propose solutions to the conundrums posed by these issues in order to provide clarity and certainty, which are vital in the corporate arena. The results of the project will be of significant interest to academics, practitioners, directors and regulators both in Australia and England, but also in other common law jurisdictions such as Hong Kong, Singapore and Canada where these issues arise.

Researcher: Dr Rosemary Teele Langford

An Analysis of Penalties under ASIC Administered Legislation

Type of grant: Centre for International Finance and Regulation (CIFR) and the University of Melbourne

Funds allocated: $389,084

Project Summary: A significant policy debate is unfolding regarding the penalties imposed by courts and other bodies under legislation administered by key economic regulators such as ASIC. The ASIC Penalties Project will conduct a holistic review of such penalties over a 10 year period from 2005 to 2014, to assess whether adequate penalties are available to ASIC and set at an appropriate level. The project will also consider whether the penalties are effectively administered and how ASIC's penalties regime could be improved.

By combining available documentary evidence with surveys and semi-structured interviews, the ASIC Penalties Project will build a penalties database and develop a series of research papers that analyse the theoretical and policy based rationales for the imposition of penalties. These initiatives can inform not only policy development and operational practice regarding ASIC, but also can be informative for other Australian regulators, regulated communities, the judiciary, law enforcement agencies, industry, media, academe and the broader public.

Researchers: Professor Ian Ramsay, Dr George Gilligan, Mr Andrew Godwin, Mr Jasper Hedges

Predatory Conduct, Consumer Rental Goods and Indigenous Consumers

Type of Grant: Melbourne Law School Indigenous Research Grant

Funds Received: $5,000

Project Summary: There is strong evidence that consumer rental companies target Indigenous communities across Australia and engage in highly predatory conduct. The Australian Securities and Investments Commission (ASIC) is involved in ongoing regulatory enforcement across Australia to reign in companies found to act unconscionably and cause irreparable harm to Indigenous consumers. While regulatory action is welcome, peak consumer legal and Indigenous organisations have expressed concern that the harm to Indigenous consumers is ongoing and that more action, from a range of state and federal agencies and organisations, is required to stamp out predatory practices and ameliorate the harm caused to consumers. To effectively reduce harm, it is clear that the problem requires multiple organisations with different expertise to collaboratively and holistically develop effective consumer protection laws and complementary policies. The research team will conduct innovative and much needed research to investigate the legal and social factors contributing to the harm to Indigenous consumers.

Researchers:  Associate Professor Paul Ali, Ms Cosima McRae and Professor Ian Ramsay

Disciplining insolvency practitioners in Australia and Singapore: legal and policy trends

Type of grant: NUS Law - MLS Research Partnerships

Funds received: $20,000

Project summary: This research partnership will investigate legal and policy trends in disciplining corporate insolvency practitioners in Australia and Singapore. Both jurisdictions have common origins in their respective corporations laws, and both have recently undertaken reviews of the regulation of practitioners in recognition of the significant role they play in the resolution of corporate insolvencies. The research will focus on models of disciplinary frameworks and the outcomes that could be achieved through reform; the effect that the introduction of clear and robust qualification standards, disciplinary procedures and disqualification standards could have on the profession; and the role of various institutions in discipline.

Researchers: Professor Ian Ramsay (Melbourne Law School), Ms Stacey Steele (Melbourne Law School), Assistant Professor Meng Seng Wee (National University of Singapore Law)

Financial Literacy and Innovation in Superannuation Product Disclosure: Improving the Retirement Savings of Australians

Type of Grant: Centre for International Finance and Regulation Project

Project Summary: Superannuation is the central pillar of Australia's unique retirement savings system. Current estimates predict that only 35% of Australians will be adequately provided for in retirement. Factors including an aging population, increased life-expectancies and higher costs of living and the inadequacy of many superannuation balances suggest strongly the need for working Australians to actively manage their superannuation investments from earlier in their working lives. Our project responds to these issues by focussing on the potential for regulatory innovations in superannuation consumer information to change consumer behaviour. Specifically, our study proposes to survey 25-35 year old superannuation consumers to understand the interaction with superannuation information.

Drawing on behavioural economics our study will provide regulators, the superannuation industry and consumer bodies with key insights about how superannuation information can assist consumers in their retirement savings planning. Our project will offer new insights about current behaviours and attitudes with the potential to improve retirement savings outcomes.

Researchers: Associate Professor Paul Ali, Professor Ian Ramsay and Dr Chander Shekhar

Phoenix activity: Regulating fraudulent use of the corporate form

Type of grant: Australian Research Council Discovery Grant

Funds received: $403,000

Project summary: Fraudulent phoenix activity is of great concern to Australian policymakers. It occurs where there is the deliberate liquidation of a company to avoid paying debts but the business continues through another company, and in corporate groups through the liquidation of undercapitalised subsidiaries and transfer of business to other companies in the group. This behaviour causes huge losses in taxation revenue and large financial losses for employees and unsecured creditors. To strengthen Australia's economic fabric, this project aims to determine the optimal method of dealing with fraudulent phoenix activity through a thorough examination of all of its aspects in Australia and by a comparative analysis of international responses.

Researchers: Associate Professor Helen Anderson, Professor Ann O'Connell, Professor Ian Ramsay and Dr Michelle Welsh

The legal and social dimensions of financial hardship in Australia: Implications for legal, regulatory and policy frameworks

Type of grant: Australian Research Council Discovery Grant

Funds received: $396,000

Project summary: Financial hardship – the reduced ability to meet monetary obligations because of loss of employment, illness or disaster – is an increasing problem for both low-income and middle-income Australians. This project is the first in-depth study of the practical operation of Australia's financial hardship laws, which are designed to protect Australians suffering financial hardship. Surveys and interviews will be undertaken of persons suffering financial hardship, those who advise them and staff of financial dispute resolution schemes. The project outcomes will include improvements to dispute resolution involving financial hardship and consumer advisory services, and potential law reform proposals.

Researchers: Associate Professor Paul Ali and Professor Ian Ramsay

Assessing the Governance of Institutional Investors when Investing in Complex Financial Products

Type of Grant: Centre for International Finance and Regulation Project

Project Summary: Institutional investment in Australia is both highly innovative and complex. The global financial crisis and the large losses that have flowed from investments in complex financial products have focused attention on the sellers of those products. However, less attention has been paid to the institutional investors who invest in complex financial products and the role of the external parties that provide investment-related services to institutional investors. This project will be the first in-depth study of the legal structure of Australian institutional investment, in the context of investments in complex financial products, the legal relationships between the participants in the selection of those investments and the legal duties that arise out of those relationships. This project will also examine the legal protections available to institutional investors and their own investors, when investing in complex financial products, and whether regulatory reform is required.

Researchers: Associate Professor Paul Ali and Professor Ian Ramsay

Financial Products and Short-form Disclosure Documents – Challenges and Trends

Type of Grant: Centre for International Finance and Regulation Project

Project Summary: Recent years have seen a global trend towards the adoption of uniform rules governing disclosure in relation to retail financial products. This trend has been reflected in the adoption of plain language techniques, the move towards short-form disclosure documents, and efforts to increase the quality of financial advice and financial literacy on the part of retail investors.

This project will analyse the challenges and trends in relation to short-form disclosure documents from a comparative perspective. The research will consider the effectiveness of short-form disclosure documents, particularly in terms of increasing risk awareness, the interface between short-form disclosure documents and other measures (e.g. plain language techniques and investor education) and whether there is a case for global or regional harmonisation. Developments in the following markets will be examined for this purpose: Australia, New Zealand, the United Kingdom, Hong Kong and Singapore.

Researchers: Mr Andrew Godwin and Professor Ian Ramsay

Evaluating the Impact of Securities Loans on Shareholder Rights and the Governance of Listed Companies

Type of Grant: Centre for International Finance and Regulation Project

Project Summary: Securities loans are a common feature of the Australian and global financial markets, and describe dealings under which a trader or investor sources securities temporarily from institutional investors, such as a superannuation fund. This practice has generated considerable controversy in the midst of the global financial crisis due to the prominent role deployed by securities loans in facilitating short selling. In addition to this, securities loans carry broad implications for the governance of companies. Securities loans make possible vote buying, by enabling the voting rights attaching to shares to be separated from the economic ownership represented by those shares. This project will be the first in-depth Australian study of the corporate governance implications of securities loans. The project will also examine the implications for shareholder rights and consider whether regulatory reform is required to protect shareholders.

Researchers: Associate Professor Paul Ali and Professor Ian Ramsay

Financial System Regulation – is Australia's "twin peaks" approach a model for China?

Type of Grant: Centre for International Finance and Regulation Project

Project Summary: The global financial crisis and its fallout have tested the integrity and resilience of regulatory frameworks in respect of financial services and have led to significant reforms to those frameworks around the world. As financial institutions and the financial markets in China become more integrated and sophisticated, it is likely that China will need to re-consider its approach to financial regulation and review developments in other markets. Inevitably, its attention will turn to the models and reforms introduced in markets such as the United Kingdom and the United States. In this research project, the researchers propose to consider the extent to which Australia's 'twin peaks' approach to financial services regulation provides a model for reform in China. Although the primary focus is on China, the researchers will also consider the extent to which the 'twin peaks' model is relevant to other emerging markets in Asia.

Researchers: Mr Andrew Godwin, Professor Ian Ramsay and Professor Li Guo

Success and Failure in Stock Exchange Consolidations: Implications for Markets and their Regulation

Type of Grant: Centre for International Finance and Regulation Project

Project Summary: Stock exchanges engaged in a frenzy of consolidation efforts recently, some successful, others not. In 2011 alone, several high profile mergers, Singapore and Sydney, NYSE Euronext and Deutsche Borse, London and Toronto, met with regulatory, political and industry opposition. In one sense, the exchanges are only catching up with the technological realities of international markets. Traditional market institutions have been undergoing change and restructuring for decades. Consolidation began at national levels in response to competitive pressures, and then spread to the creation of regional and supra-regional institutions in an effort to achieve strategic and operational advantages. This project examines the process of stock exchange consolidations, and the alternatives, from a regulatory and market perspective and examines the reasons for success or failure. There are lessons to be learned from both the successes and the failures, with implications for the future direction of regulatory change and the market institutions themselves.

Researchers: Professor Cally Jordan and Professor Stephane Rousseau

Financial regulation in Asia – A new model for regional cooperation

Type of grant: Melbourne School of Government Research Cluster Grant

Funds received: $213,917

Chief investigators: Mr Andrew Godwin (Melbourne Law School), Professor Andrew Mitchell (Melbourne Law School), Professor Ian Ramsay (Melbourne Law School), Professor Kevin Davis (School of Business and Economics), Dr Jikon Lai (Faculty of Arts), Professor Andrew Walter (Faculty of Arts)

External collaborators: Professor Douglas Arner (Law Faculty, University of Hong Kong), Mr Datuk Seri Panglima Andrew Sheng (Fung Global Institute), Professor Wataru Takahashi (Faculty of Economics, Osaka University), Professor Ken Waller (Faculty of Finance & Economics, Australian AOEC Study Centre, RMIT)

Project summary: This project will study the development of Asian financial regulations from a variety of perspectives such as finance, law, politics and international relations. The study will focus on the unique circumstances present in Asia as well as identifying the risks and the value that regional cooperation and integration can play in the development of international regulatory rules.

Evaluating Australian personal insolvency laws in the context of changing demographics and increasing financial stress

Type of grant: Australian Research Council Linkage Grant

Funds received: $425,465

Chief investigators: Associate Professor Paul Ali (Melbourne Law School), Professor Ian Ramsay (Melbourne Law School), Dr Kathy Landvogt (Good Shepherd Youth & Family Service), Mr Gerard Brody (Consumer Action Law Centre), and Ms Fiona Guthrie (Financial Counselling Australia Incorporated)

Project summary: This project will study how Australians respond to financial stress within the context of Australian personal insolvency laws. A better understanding of the practical impact of these laws today will enable an evaluation of their effectiveness in meeting policy objectives.

A Comparative Analysis of the Reform of Personal Property Security Law in Australia and the United Kingdom

Type of Grant: Oxford University Law School – Melbourne Law School Research Partnerships Grant

Funds Received: $17,500 and £10,000

Chief Investigators: Associate Professor Paul Ali, Professor Ian Ramsay and Professor Louise Gullifer (University of Oxford)

Project Summary: The law of personal property security deals broadly with the issue of how lenders and other providers of corporate and consumer credit can protect their claims against borrowers by taking security over the personal property held by borrowers. Personal property securities reduce the risks associated with providing credit and should therefore contribute to the increased availability of credit. Balanced against this, however, are the legal complexities confronted by lenders when taking security over personal property. This area of law has been the subject of several proposals for reform in both the UK and Australia. This project aims to assess the divergent approaches towards the regulation of personal property securities in the two jurisdictions, with a view to seeing what benefits an Australian Personal Property Securities Act 2009 - type reform could have for the UK and also what pitfalls are likely in any such reform process.

Reform of consumer lease contracts - Ensuring greater protection for consumers

Type of grant: Victorian Law Foundation Grant

Funds received: $4,990

Chief investigators: Associate Professor Paul Ali, Cosima McRae and Professor Ian Ramsay

Project summary: Consumer leases can be an expensive and unhealthy form of consumer credit with some lenders targeting financially vulnerable consumers. The project investigates the experiences of consumers with consumer leases and evaluates current regulation with the aim of determining whether reform is needed.

Safeguarding the Financial Well-Being of Australians by Improving Financial Literacy: Implications for Consumer Protection Laws

Type of grant: Australian Research Council Discovery Grant

Funds received: $276,000

Chief investigators: Associate Professor Paul Ali and Professor Ian Ramsay

Project summary: The project will contribute to a broader understanding of the role of financial literacy in Australia and its relationship with Australia's financial services and consumer protection laws. Having financially literate consumers facilitates the uptake and development of innovative financial products. This is essential for promoting an innovation culture and economy. Higher levels of financial literacy also enable consumers to plan better for their and their families' financial well-being. This also has national benefit as it means that consumers are better prepared to deal with the adverse financial consequences of job-loss, illness, disablement or death, thus reducing the stresses and demands on Australia's social welfare safety net.

New Initiatives in Enforcing Employment Standards: Assessing the Effectiveness of Federal Government Compliance Strategies

Type of grant: Australian Research Council Linkage Project

Funds received: $180,000

Chief investigators: Associate Professor John Howe and Associate Professor Sean Cooney

Project summary: The well-being of more than eight million Australian employees is underpinned by statutory workplace entitlements. For the large majority of those employees, these are set by federal legislation. The statutory entitlements are meaningful only in so far as they are complied with, and improving the effectiveness of the federal enforcement agency, the Workplace Ombudsman, is therefore of crucial public importance. This project provides the first comprehensive scholarly empirical evaluation of the Workplace Ombudsman. Its findings will identify multiple ways in which enforcement practices can be improved, not only for the Workplace Ombudsman, but also for comparable compliance agencies domestically and overseas.

Legal Origins: The Impact of Different Legal Systems on the Regulation of the Business Enterprise in the Asia-Pacific Region

Type of grant: Australian Research Council Discovery Grant

Funds received: $250,000

Chief investigators: Professor Ian Ramsay together with Professor Richard Mitchell, Associate Professor Sean Cooney and Associate Professor Peter Gahan

Project summary: This project will locate Australia and several major countries in our region within a highly influential international scholarly debate about appropriate forms of business regulation. It will contribute to domestic policy-making debates about the most effective legal methods for promoting an innovative and productive economy, especially in the areas of corporate and labour law. It will also enable Australian policy makers to participate in international policy reform debates facilitated through international institutions. In particular, it will enhance Australia's capacity to understand and contribute to the establishment of better legal systems in our region, enhancing important trading and strategic relationships.

The Costs of Corporate Litigation in Australia

Type of grant: Melbourne Centre for Financial Studies Grant

Funds received: $12,000

Chief investigators: Professor Ian Ramsay and Associate Professor Asjeet Lamba (Faculty of Economics and Commerce)

Project summary: The project examines the costs associated with corporate litigation and the possible sources of these costs. The project provides further evidence on: (a) the costs of litigation involving companies and a breakdown of these costs by party and legal issue and (b) the rules on allocating legal costs between parties. The results of the project should lead to a better understanding of the market's reaction to corporate litigation, settlement and judgment events leading to more informed dispute resolution.

The Impact of Variable Rate Home Loan Early Termination Fees on Low Income Vulnerable Home-Owners

Type of Grant: Victoria Law Foundation Grant

Funds Received: $4,565

Chief Investigator: Professor Ian Ramsay

Project Summary: Vulnerable home owners with variable rate mortgages have recently been 'locked into' mortgages with lenders who have (1) unilaterally increased interest rates to un-competitively high levels; and (2) unilaterally imposed very high early termination fees. The project investigates the extent to which the law provides consumers with a remedy to challenge excessive early termination fees and aims to suggest law reform avenues that may be necessary.

A Cancer on our Economy? An Empirical Interdisciplinary Study of the Criminalisation of Serious Cartel Conduct in Australia

Type of Grant: Australian Research Council Discovery Grant

Funds Received: $340,000

Chief Investigators: Dr CE Parker together with Dr CY Beaton-Wells, Dr FS Haines and Professor DK Round

Project Summary: Serious cartel conduct is seen as highly damaging to Australia's economic welfare but only recently has it been regarded as criminal. This research will inform public debate about the impetus and justification for this major shift in competition law policy and enforcement. It will provide robust empirical evidence about public opinion and business behaviour and derive insights into whether criminalisation will promote greater compliance with the law. It will assist in refining practical implementation measures to ensure the effectiveness of a criminal regime and it will aid legislators and regulators in policy-making, regulatory design and enforcement in relation to competition law and business regulation more generally.

The Liability of Corporate Groups

Type of Grant: Australian Research Council Discovery Grant

Funds Received: $157,618

Chief Investigator: Associate Professor Helen Anderson and Associate Professor Christian Witting

Project Summary: The importance of a re examination of the rules of limited liability has been demonstrated in many recent cases of corporate wrongdoing and collapse. This has been highlighted by the restructuring of the James Hardie Group of companies, the conscious aim of which was the decision to free the group of its asbestos liability 'legacy'. Were it not for government intervention, thousands of persons injured by asbestos products would have gone without compensation. One means by which such unfairness can be avoided is by reform to the rules of limited liability. This project will explore the means by which this could be achieved.

Employee Share Ownership Plans: Current Practice and Regulatory Reform

Type of Grant: Australian Research Council Discovery Grant

Funds Received: $323,000

Chief Investigators: Professor Ian Ramsay, Professor Cameron Rider, Associate Professor Ann O'Connell and Professor Richard Mitchell

Project Summary: Employee Share Ownership Plans (ESOPs) are important to the development of an economic culture of enterprise and innovation and the building of national wealth and savings in response to long-term demands of intergenerational equity. ESOPs require development through appropriate regulatory frameworks. This project will subject the existing regime of tax, corporate and labour law to technical and empirical scrutiny. This will enhance the capacity of policy makers to evaluate and identify appropriate regulatory techniques to ensure the growth of efficiency of ESOPs at the national and enterprise level.

The Impact of ACCC Enforcement Action: Evaluating the Explanatory and Normative Power of Responsive Regulation and Responsive Law

Type of Grant: Australian Research Council Discovery Grant (Australian Research Fellowship)

Funds Received: $350,000

Chief Investigators: Dr Christine Parker and Vibeke Nielsen

Project Summary: The project will enhance the capacity of the ACCC and other business regulators to ethically and effectively regulate to achieve the goals of regulatory policy such as a fair, competitive economy, occupational health and safety, and environmental integrity. Australia is already well recognised as a leader in ambitious empirical and policy oriented social science research on regulatory compliance (through the ARC funded Governance Network including RegNet at ANU). This project will enhance that reputation with the most comprehensive data set on the corporate compliance impact of enforcement action and fundamental re-thinking of foundational theoretical questions about the nature and capacities of regulation.

The Governance Research Network (GovNet)

Type of Grant: Australian Research Council Research Network Grant

Funds received: $1,500,000

Chief investigators: Professor Charles Sampford, Griffith University; Centre for Corporate Law Participants: Professor Ian Ramsay and Dr Christine Parker

This project brings together 50 scholars from 12 universities to undertake cross-disciplinary governance research.

Project Summary: Institutions and their governance are frequently part of our most pressing problems - not least in our national research priorities. Hence, institutions are invariably a key part of the solutions. GovNet unites three ARC Centres, two existing networks (RegNet, ANZSOG) and several other dynamic centres to create an interdisciplinary network of ethicists, lawyers, political scientists, economists and historians. It will tackle issues of institutional governance, from small firms to global institutions recognising both common governance issues and radically differing contexts. Together with APSEG and government agencies, it will apply cutting edge cross-disciplinary, theory-driven, evidence-based research to governance issues in the region.

Corporate Governance and Institutional Investment in the Australian Financial Markets

Type of Grant: Australian Research Council Discovery Grant

Funds received: $130,000

Chief investigators: Dr Paul Ali and Dr Geof Stapledon

Project Summary:The financial markets play a vital role in Australian economic life. The majority of the assets of Australian superannuation funds and managed investment funds are financial products. This project will provide an comprehensive account of the different types of complex financial products available in Australia and an assessment of the corporate governance practices at Australian companies and Australian institutional investors in relation to their use of complex financial products. Through these outcomes, the project will contribute to a broader understanding of the Australian financial markets and the enhancement of corporate governance practices in Australia.

Corporate Governance in the Australian Financial Markets

Type of Grant: Melbourne University Research Grant

Funds received: $14,000

Chief investigators: Dr Paul Ali and Dr Geof Stapledon

Project Summary: The project examines the corporate governance aspects of transactions in the Australian financial markets, in particular the legal design of complex financial products, the efficacy of the new regime introduced by the Financial Services Reform Act 2001 (Cth) for the regulation of financial products, and the role of institutional investors in supervising the use of complex financial products by the companies in which they have invested.

Synthetic Securitisations and the Revolution in Credit Risk Management

Type of Grant: Melbourne University Early Career Researcher Grant

Funds received: $8,750

Chief Investigator: Dr Paul Ali

Project Summary: This project focuses on recent innovations in securitisation, particularly in relation to the issuance of debt securities backed by derivatives. These so-called synthetic securitisations, in essence, segregate assets into their component risks and effect a transfer of certain risks independent of the assets to the investors in the debt securities. The key example is the synthetic CDO (Collateralised Debt Obligations) which involves the securitisation of the credit risk on bond or loan portfolios. The emerging class of managed arbitrage synthetic CDOs is also examined. In addition, the project investigates the securitisation of non-traditional assets.

Partnerships at Work: The Interaction Between Employment Systems and Corporate Governance and Ownership Structure

Type of Grant: Australian Research Council Discovery Grant

Chief Investigators: Professor Ian Ramsay, Professor Richard Mitchell

Funds Received: $640,500

Project Summary: The project will examine the interaction between several key factors in the creation and sustainability of 'Partnerships at Work'. These factors include particular employment systems, forms of corporate governance and ownership structures. The project proposes to discover how these various factors have interacted so as to give rise to — or fail to give rise to — 'high performance' partnership-style relations at work. This project will focus on the interaction between these factors within a regulatory environment established by labour law and corporate law. What are the elements of 'co-operative' or 'partnership' employment systems? What are the integrating institutions or conventions - if any - that incorporate workers or their representatives into managerial processes? How do company directors actually balance the interests of employees and shareholders within the framework of the obligations imposed by directors' duties? How flexible are those duties? What possible shortcomings might exist in the practical application of those duties? Is there a congruence between types of corporate governance systems and types of employment system?

Islamic Law in Contemporary Indonesia

Type of Grant: Australian Research Council Discovery Grant

Chief Investigators: Associate Professor Tim Lindsey and Barry Hooker (Australian National University)

Funds Received: $139,270

Project Summary: This project aims to fill serious gaps in Asian and Western scholarship on Islamic law in contemporary Indonesia in the context of the tension between Islam and state, an issue highlighted by the Bali bomb and Jemaah Islamiyah trials. It aims to do so by working closely with leading Indonesian legal scholars and institutions to develop an approach to researching Islamic law that embraces internal Islamic jurisprudence, both Middle Eastern and Southeast Asian, as well as leading Western scholarship on Islam and law. It seeks a new syncretic approach to Islamic legal scholarship, to be constructed within the limited confines of an investigation into the practical operation of syariah in Indonesia in the last 50 years, with a particular focus on the last decade. This project aims to produce journal articles, briefing papers, teaching materials and a joint monograph by the Chief Investigators in English and Indonesian. In the longer term, this project will contribute to increasing Australian understandings of Islamic law, culture and societies.

Accountability and Corporate Governance in Non-Profit Companies

Type of Grant: Australian Research Council Strategic Partnerships with Industry Grant

Chief Investigators: Professor Ian Ramsay, Ms Sue Woodward and Ms Sally Sievers

Industry Partner: Philanthropy Australia Inc

Funds Received: $80,000 with matching funds contributed by Philanthropy Australia Inc

Project Summary: Australians give $2.8 billion annually to non-profit organisations. Official estimates suggest spending by these organisations represents almost 10% of Gross Domestic Product. Increasingly the importance of the sector is being recognised, but in Australia there has been limited research into non-profit companies. This collaborative project will examine the appropriateness of existing corporate structures for non-profit organisations. It will also evaluate the effectiveness of laws relating to directors' duties as a means of providing accountability and good governance to stakeholders (eg, members, grant givers and the public). The appropriateness of laws designed for companies with profit-making objectives will be challenged.

Directorship in Entrepreneurial Firms and the Role of Public and Private Capital Markets

Type of Grant: Australian Research Council Large Grant

Chief Investigators: Associate Professor Michael Whincop (Griffith University Law School), Professor Ian Ramsay and Dr Geof Stapledon (University of Melbourne Law School) and Professor R J Gilson (Stanford and Columbia Law Schools)

Funds Received: $127,393

Project Summary: This project examines the purposes of boards of directors in entrepreneurial firms, the optimal corporate law to support these institutions, characteristics of the market for these director services, and the connection with public and private capital markets. We will examine and challenge the applicability of corporate governance models developed for listed corporations to entrepreneurial firms. We will test hypotheses concerning the effect of venture capital and the investor's strategy for exiting the firm on the structure of entrepreneurial boards. The empirically enriched understanding and normative policy analysis of the most dynamic firms in modern economies will reshape corporate regulation and scholarship.

The Governance of Managed Investment Schemes

Type of Grant: Australian Research Council Large Grant

Chief Researchers: Professor Ian Ramsay, Ms Pamela Hanrahan and Dr Geof Stapledon

Funds Received: $137,000

Project Summary: As of 30 June 1998, the consolidated assets of managed investment schemes such as cash management, equity and property trusts in Australia exceeded $100 billion. The Managed Investments Act 1998 (Cth) introduced a fundamentally new regime for the regulatory oversight and governance of managed investment schemes. This project examines and evaluates the effectiveness and efficiency of this new regime as a means of ensuring compliance with the requirements of the Managed Investments Act and for maximising investor protection.

Use and Operation of the Enforcement Regime Attracted by Contraventions of Directors' Duties in the Australian Corporations Law

Type of Grant: Australian Research Council Strategic Partnership with Industry - Research and Training Grant

Chief Researchers: Professor Ian Ramsay, Ms Helen Bird and Professor Arie Freiberg (Department of Criminology, The University of Melbourne)

Industry Partner: The Australian Securities and Investments Commission

Funds Received: $90,000 with matching funds contributed by the Australian Securities and Investments Commission

Project Summary: This project is the first comprehensive study of the operation of civil penalties and other sanctions for promoting compliance with legislation imposing duties on directors of Australian corporations. It involves an empirical study of enforcement and prosecution activities undertaken by the Australian corporate law regulator, the Australian Securities and Investments Commission (ASIC), from its inception in 1991 until 1998. The significance of the project is that it will be undertaken at a time when there is widespread community concern about corporate crime. The project will evaluate the effectiveness of enforcement of directors' duties by ASIC.

Electronic Prospectuses: Devising an Appropriate Regulatory Regime

Type of Grant: Australian Research Council Strategic Partnership with Industry - Research and Training Grant

Chief Researchers: Dr Elizabeth Boros and Professor Ian Ramsay

Industry Partner: The Australian Securities and Investments Commission

Funds Received: $93,000 with matching funds contributed by the Australian Securities and Investments Commission

Project Summary: In late 1996 the Australian Securities and Investments Commission (ASIC) stated that it would permit the distribution of prospectuses on the Internet. In 1995 almost $5 billion in capital was raised by companies listed on the Australian Stock Exchange using prospectuses to raise capital. However ASIC still requires the existence of a paper prospectus. This project aims, in collaboration with ASIC, to devise a regulatory regime which will meet the three goals of (1) enabling market participants to fully exploit the capabilities of electronic commerce; (2) protecting investors; and (3) harmonising Australian law with international regulatory regimes.

Corporate Disclosure: An Analysis of the Role of Prospectuses in Capital Raising in Australia and New Zealand

Type of Grant: Australian Research Council Large Grant

Chief Researchers: Professor Ian Ramsay and Mr Gordon Walker (University of Canterbury)

Funds Received: $65,000

Project Summary: Public investment in the shares of Australian and New Zealand companies is undertaken by companies preparing and issuing prospectuses. Yet there are major concerns that the existing law regulating prospectuses does not adequately reflect an appropriate balance of the costs and benefits associated with prospectus regulation. The project will test the actual use made of prospectuses by investors and their advisers. It will also obtain evidence on why there is substantial non-compliance with the existing law regulating prospectuses.

The Impact of Institutional Investors on Capital Markets and Corporate Performance

Type of Grant: Australian Research Council Collaborative Grant

Chief Researchers: Professor Ian Ramsay, Dr Geof Stapledon and Professor Kevin Davis (Department of Accounting and Finance, The University of Melbourne)

Industry Partner: The Australian Investment Managers' Association (which represents approximately the 60 largest institutional investors in Australia)

Funds Received: $72,452 with matching funds contributed by the Australian Investment Managers' Association

Project Summary: Institutional investors are significant investors in Australian companies. The impact of institutional investment upon capital markets and upon corporate performance are important matters that have been widely researched overseas, but have received little attention in Australia. One reason for the lack of Australian research is the lack of information about institutional shareholdings in Australian companies. The project will provide this information, largely through the Australian Investment Managers' Association, by identifying the fund managers which control the registered shareholdings disclosed by companies. The information will then be utilised in several studies of the impact of institutional investors on the capital markets and corporate performance.

Southeast Asian Laws in Transition: 1945-1995

Type of Grant: Australian Research Council Large Grant

Chief Researcher: Dr Timothy Lindsey

Funds Received: $128,000

Project Summary: This research project has two aims. First, to access and analyse legal materials and original sources currently unavailable to researchers and practitioners in Asian Law. Second, to publish twelve volumes of materials and commentary (two theoretical and ten covering individual countries) providing resources for practising and academic lawyers for understanding:

1. legal and commercial developments in South-East Asia; and
2. the intra-regional influence of Japan and China on law and business in South-East Asia.

Directors' Misconduct Decriminalised: Are the "Civil" Sanctions in the Corporations Law Effective?

Type of Grant: Criminology Research Council Grant

Chief Researchers: Ms Helen Bird, Dr George Gilligan and Professor Ian Ramsay

Funds Received: $20,395

Project Summary: This project examines the effect of decriminalisation of misconduct by company directors in contravention of the Corporations Law. It involves an empirical study of prosecution and enforcement actions taken by the Australian Securities and Investments Commission before and since decriminalisation took effect in 1993. It also involves a comparative study of other enforcement regimes and activity in England, Canada and New Zealand.

Using Electronic Commerce to Authorise Electronic Transactions: Changes Required to the Legal and Regulatory Framework

Type of Grant: University of Melbourne Special Initiatives Grant

Chief Researcher: Associate Professor Mark Sneddon

Funds Received: $15,000

Project Summary: Many governments and businesses have proposed that paper-based transactions as diverse as sales contracts and issuing drivers' licences be replaced by electronic messages. Electronic signatures will be used to authenticate the sender's identity and make the person to whom that signature is certified to belong legally bound by the message. The possible changes required to existing laws involve important policy choices. This project will (1) identify existing Australian laws that would require alteration and (2) provide a comparative analysis of the models for legal change proposed in Australia and overseas and their underpinning policy choices.

The Role of Institutional Investors in Corporate Governance and the Influence of Corporate Law on this Role

Type of Grant: Australian Research Council Small Grant

Chief Researchers: Professor Ian Ramsay and Dr Geof Stapledon

Funds Received: $19,800 plus research infrastructure funds provided by The University of Melbourne of $4,954

Project Summary: There is a lack of evidence and information on the role of institutional investors in corporate ownership and control. The project provides this evidence by way of detailed interviews with Australian institutional investors on a range of matters relating to their activities and views on corporate governance and investment policy. The project also identifies possible barriers, including legal barriers, to institutional investor activism (ie, why institutional investors may not actively monitor the management of companies in which they invest) and the views of institutional investors are sought in relation to whether these possible barriers do actually inhibit institutional investor activism.

Selling Managed Funds: CLERP 6 and the Proposed Uniform Laws Governing the Distribution of Interests in Managed Funds

Type of Grant: University of Melbourne Special Initiatives Grant

Chief Researcher: Ms Pamela Hanrahan

Funds Received: $10,000

Project Summary: Millions of Australians invest in managed funds such as superannuation funds, public unit trusts and investment linked life insurance products. Currently, the investor protection laws applying to the distribution (sale) of these investments are not uniform across the different segments of the industry. To cure this (and other perceived problems with the existing laws) extensive amendment to the laws governing disclosure and inter-mediation in the distribution of managed funds has recently been proposed under the Corporate Law Economic Reform Program. The purpose of this project is to examine those proposals and their likely effect on investor protection and industry efficiency.

Reducing the Cost of Capital Raising: An Empirical Analysis of ASIC Modifications of the Fundraising Provisions of the Corporations Law

Type of Grant: Australian Research Council Small Grant

Chief Researcher: Dr Geof Stapledon

Funds Received: $7,500

Project Summary: The Australian Securities and Investments Commission (ASIC) has the power to modify the prospectus - and other fundraising - provisions of the Corporations Law on a case-by-case basis. The project involves an analysis of the use of this power by ASIC. The objective is to determine whether the statutory fundraising requirements could be reduced further than is being proposed under the Federal Government's Corporate Law Economic Reform Program (CLERP), in order to minimise the cost of capital raising to Australian business.

An Analysis of Factors Influencing the Share Buy-back Decision

Type of Grant: University of Melbourne Faculty of Economics and Commerce Research Grant

Chief Researchers: Professor Ian Ramsay and Dr Asjeet Lamba (Centre of Financial Studies, The University of Melbourne)

Funds Received: $7,000

Project Summary: This project extends and expands upon a study conducted by the Chief Researchers titled "Share Buy-backs in a Highly Regulated and Less Regulated Market Environment" which documents the market's valuation of share buy-backs announced by ASX listed firms during 1989-98. In addition to updating and extending this study, this project will provide evidence on (1) the long run return behaviour of various share buy-back programs and (2) the relationship between firm-specific variables and the short run and long run return behaviour of share buy-backs. The results of the study should lead to a better understanding of the factors influencing the share buy-back decision of managers.

Compulsory Acquisition of Minority Shareholdings

Type of Grant: Australian Research Council Small Grant

Chief Researcher: Dr Elizabeth Boros

Funds Received: $7,000 plus research infrastructure funds provided by The University of Melbourne of $3,500

Project Summary: Debate regarding the landmark decision in Gambotto v WCP Ltd has culminated in a law reform proposal by the Companies and Securities Advisory Committee (CASAC) proposing expansion of the range of situations in which a majority shareholder can compulsorily acquire all outstanding shares in a company. This project will conduct detailed interviews with takeover offerors in order to ascertain the relative importance to them of the various benefits of 100 per cent ownership. It will then seek to determine whether the most significant of those advantages can be achieved by means other than expropriation of minority shareholdings and, if so, to suggest alternative directions for law reform to that proposed by CASAC.

The Costs of Corporate Litigation

Type of Grant: University of Melbourne Faculty of Economics and Commerce Research Grant

Chief Researchers: Professor Ian Ramsay and Dr Asjeet Lamba (Centre of Financial Studies, The University of Melbourne)

Funds Received: $8,900

Project Summary: The project examines the costs associated with corporate litigation and possible sources of these costs by using event study methodology. In particular, the study provides evidence on (1) the costs of litigation involving companies and a breakdown of these costs and (2) the rules on allocating legal costs between parties. The results of the study should lead to a better understanding of the market's reaction to corporate litigation events and to more informed dispute resolution.

The Legal Implications of the Relative Performance of Publicly Listed Australian Companies With and Without a Controlling Shareholder

Type of Grant: University of Melbourne Special Initiatives Grant

Chief Researcher: Dr Geof Stapledon

Funds Received: $12,000

Project Summary: Many publicly listed Australian companies have a single shareholder who/which has effective control of the company. The project will compare the past performance of such controlled companies with that of non-controlled listed companies. If the performance of the controlled companies is superior then there may well be a case for amending certain parts of the legislation governing takeovers so as to produce a legal framework more conducive to controlled companies. This in turn would probably lead to improved performance by the Australian corporate sector overall.

Analysis of Victorian Legal Signature and Writing Requirements for Compatibility With the Proposed Electronic Commerce Framework Act

Type of Grant: State of Victoria Office of Multimedia

Chief Researcher: Associate Professor Mark Sneddon

Funds Received: $16,340

Project Summary: This project will investigate the legislative need to facilitate electronic signatures and records with particular focus upon Victorian legislation.

Remedies for Directors' Improper Use of Position

Type of Grant: University of Melbourne Special Initiatives Grant

Chief Researcher: Dr Elizabeth Boros

Funds Received: $12,000

Project Summary: This project focuses on the situation where directors divert a business opportunity away from the company of which they are a director either to themselves or to another company of which they are also a director. Specifically, it:

1. examines the means by which courts determine the amounts which are recoverable from directors in equitable proceedings and in proceedings brought under statutory provisions; and
2. seeks to identify the assumptions and policies underlying the results of the decided cases.

Women and Commerce

Type of Grant: University of Melbourne Special Initiatives Grant

Chief Researcher: Dr Belinda Fehlberg

Funds Received: $8,000

Project Summary: Commercial law (including corporate law) has historically been dominated by men. This project will analyse legal and other materials (for example government reports) to consider:

1. how United Kingdom and Australian law depicts women in commercial (including corporate) transactions; and

1. to what extent the law in this area reflects the practical role of women and the concerns of women

The Centre has previously published monographs in corporate law and securities regulation. The Monograph series has now been replaced by our Research Reports and Research Papers.

Nicole Calleja, The New Takeovers Panel - A Better Way? (2002)

As a result of the enactment of the Corporate Law Economic Reform Program Act, which commenced on 13 March 2000, the Takeovers Panel, which was previously known as the Corporations and Securities Panel, became the recipient of increased powers. It therefore has a new and important role to play regarding the adjudication of disputes involving takeovers.

The author is Nicole Calleja, who is with Allens Arthur Robinson. She was previously seconded to work as a member of the Executive of the Takeovers Panel.

The chapters in the book are:

1. Introduction
2. Overview of the Powers of the New Panel
3. The History of the Board
4. The Functions and Responsibilities of the New Panel
5. International Perspective
6. The Performance of the New Panel
7. Assessment of the Panel's Performance to Date and Current Challenges
8. Conclusion

Larelle Chapple and Phillip Lipton, Corporate Authority and Dealings With Officers and Agents (2002)

One of the most important practical issues for companies and their advisers is the legal authority of agents and officers to act for a company. Many court judgments and significant statutory amendments have recently added to the law in this area. Larelle Chapple and Phillip Lipton review both the statutory and judicial principles relating to corporate authority. In addition to legal analysis, the book provides practical advice to lenders in order to ensure that contracts by companies have been properly authorised.

The chapters in the book are:

1. Introduction
2. Actual and Apparent Authority of a Company's Agent
3. The Indoor Management Rule at Common Law
4. Exceptions to the Rule in Turquand's Case
5. The Statutory Reformulation of the Indoor Management Rule
6. The Statutory Assumptions: Section 129
7. The Indoor Management Rule and Forgeries
8. The Limitations to the Statutory Assumptions
9. Implications for Lenders
10. Overview

Ian Ramsay (editor), Company Directors' Liability for Insolvent Trading (2000)

Company directors in many countries are under a duty to prevent their companies trading if they are insolvent. If the duty is breached, the director may be personally liable for the debts incurred by the company while it is insolvent. This duty is one of the most important and controversial of the duties imposed upon company directors.

This new book is a detailed analysis of the duty imposed upon company directors to prevent insolvent trading. The law in a number of countries is examined.

The chapters in the book are:

1. An overview of the insolvent trading debate
2. Corporate directors' personal liability for "insolvent trading" in Australia, "reckless trading" in New Zealand and "wrongful trading" in England: A recipe for timid directors, hamstrung controlling shareholders and skittish lenders
3. The economic and strategic structure of insolvent trading
4. Insolvent trading in Australia: The legal principles
5. The recovery of employee entitlements in insolvency
6. Why are there so few insolvent trading cases?
7. Directors' liability for trading while insolvent: A critical review of the New Zealand regime
8. Civil liability of directors for company debts under English law

Contributors include Professor Dan Prentice of Oxford University and Professor Dale Oesterle of the University of Colorado School of Law.

Vivien Goldwasser, Stock Market Manipulation and Short Selling (1999)

The recent Federal Court judgment in Australian Securities Commission v Nomura International plc has highlighted the importance of the regulation of stock market manipulation. In this judgment, Justice Sackville held that Nomura had engaged in trading which constituted stock market manipulation. Securities Commission Chairman Mr Alan Cameron has described the judgment as a "landmark decision…that helps establish the boundaries of acceptable trading strategies".

The regulation of stock market manipulation and short selling is fundamental to the integrity of the securities markets. In this new book, published by CCH and the Centre for Corporate Law and Securities Regulation, Dr Goldwasser identifies the various techniques of stock market manipulation and short selling; outlines the history and rationale of regulation in this area; provides detailed analysis of the statutory regulation of short selling and stock market manipulation; and outlines the regulation of stock market manipulation not only in Australia but also in the United States, the United Kingdom, Canada and New Zealand.

This book is of relevance to those in the securities industry (brokers, analysts, bankers) and their advisers (legal, financial and accounting) as well as to regulators and academics.

Pamela Hanrahan, Managed Investments Law (1998)

Managed investment schemes such as public unit trusts, agricultural schemes, serviced strata developments and other investment schemes represent a very substantial part of the Australian economy, with assets under management now totalling over $100 billion.

The law governing managed investment schemes was totally rewritten on 1 July 1998, with the commencement of the Managed Investments Act 1998. CCH and the Centre for Corporate Law and Securities Regulation at The University of Melbourne have now published the definitive Managed Investments Law, a comprehensive analysis of the new provisions by leading academic and practitioner Pamela Hanrahan.

Managed Investments Law provides expert commentary on the key legislative provisions and ASIC policy statements, covering:

• Scope of regulation
• Establishing a registered scheme
• Administering and altering schemes
• Role and duties of the responsible entity
• Compliance monitoring
• Duties and liabilities of officers and compliance committee members
• Members' rights
• Role and powers of ASIC
• Deregistration and termination

Donna Croker, Prospectus Liability Under the Corporations Law (1998)

In 1997 over $25 billion in capital was raised by companies listed on the Australian Stock Exchange. Recent court judgments such as the Full Federal Court judgment in Fraser v NRMA Holdings Ltd and the increased emphasis given to the need for due diligence under the Corporations Law, have focused attention upon the liability that can apply to those engaged in capital raising for companies.

Those potentially liable include the company, its directors, auditors, bankers, solicitors, underwriters, stockbrokers and those who authorised or caused the issue of the prospectus. This book analyses the liability provisions of the Corporations Law as they apply to those involved in capital raising. It also analyses the defences to liability.

The Federal Government has proposed amendments to the prospectus provisions of the Corporations Law as part of its Corporate Law Economic Reform Program. The book reviews these proposed changes and considers how they will affect those involved in capital raising.

Ian Ramsay (editor), Corporate Governance and the Duties of Company Directors (1997)

With the publication in late 1997 of the Federal Government's Corporate Law Economic Reform Program paper titled Directors' Duties and Corporate Governance and the many recent court cases and legislative changes dealing with directors, the role of directors' duties has never been more important. This book provides detailed legal analysis of directors' duties and also addresses important issues in the corporate governance debate.

The duties examined include the duty of care, skill and diligence; the duty to act in good faith and for proper purposes; the duty to act honestly; and the duty to refrain from making improper use of information and position. Other specific legal issues reviewed include the liabilities of nominee directors and "shadow" director and other third party liability for corporate activity.

A feature of the book is that the authors include leading judges who have been involved in major cases relating to directors' duties, well known practitioners, regulators and academics.

Part 1 - Introduction

Chapter 1
The Corporate Governance Debate and the Role of Directors' Duties , Professor Ian Ramsay, Harold Ford Professor of Commercial Law, The University of Melbourne.

Part 2 - Corporate Governance

Chapter 2
The Defining Tension in Corporate Governance in America , Chief Justice E Norman Veasey, Chief Justice of the Supreme Court of Delaware.

Chapter 3
The Role of Corporate Governance Practices in the Development of Legal Principles Relating to Directors , Justice Alex Chernov, Judge of the Supreme Court of Victoria.

Chapter 4
Corporate Governance, Corporate Law and Global Forces, Justice Michael Kirby, Judge of the High Court of Australia.

Part 3 - Directors' Duties

Chapter 5
Directors' Duties: The Governing Principles, Chief Justice David Malcolm, Chief Justice of the Supreme Court of Western Australia.

Chapter 6
The Duty of Care of Company Directors in Australia and New Zealand, Professor John Farrar, Faculty of Law, Bond University; Professorial Associate, Faculty of Law, The University of Melbourne.

Chapter 7
The Duty of Care of Directors: Does it Depend Upon the Swing of the Pendulum? Professor Robert Baxt, Partner, Arthur Robinson & Hedderwicks; Professorial Associate, Faculty of Law, The University of Melbourne.

Chapter 8
Directors' Statutory Duties of Honesty and Propriety , Michael J Whincop, Senior Lecturer, Faculty of Law, Griffith University.

Chapter 9
The Role of Nominee Directors and the Liability of their Appointors, Justice E W Thomas, Judge of the Court of Appeal of New Zealand.

Chapter 10
Shadow Director and Other Third Party Liability for Corporate Activity, Robyn Carroll, Senior Lecturer, Faculty of Law, The University of Western Australia.

Chapter 11
Safe Harbours or Sleepy Hollows: Does Australia Need a Statutory Business Judgment Rule?, Professor Paul Redmond, Dean and Professor of Law, Faculty of Law, The University of New South Wales.

Chapter 12
The Perspective of the Australian Securities Commission on the Enforcement of Directors' Duties and the Role of the Courts, Alan Cameron AM, Chairman of the Australian Securities Commission.

Cally Jordan, International Survey of Corporate Law in Asia, Europe, North America and the Commonwealth (1997)

This International Survey of corporate law regimes was prepared for the Review of the Hong Kong Companies Ordinance. The United Kingdom, several Commonwealth jurisdictions (Canada, Australia, South Africa and New Zealand), the United States, Hong Kong, Singapore and the People's Republic of China have been chosen for consideration. In addition, shorter sections on the European Union, France, Germany and Bermuda have been included.

The Survey provides a legislative history indicating the sources of the corporations laws in each jurisdiction, the direction which they have taken over time and their main characteristics. Distinctive features (such as the close corporation in South Africa) are highlighted as well as similarities and points of convergence among the various regimes. The Survey reviews in each jurisdiction corporate formalities, shareholders' remedies, directors' duties and the treatment of foreign corporations.

The Survey deals with how companies and corporations are governed; how the major issues associated with corporate activity are dealt with; what the major differences are in approach from one jurisdiction to another; and how different historical developments have affected current structures.

The Survey also gives an indication of dominant trends worldwide with respect to corporate law. With the rapid internationalisation of financial and commercial activity in recent years, there has developed an increasing interdependence of domestic legal regimes.

Megan Richardson (editor), Deregulation of Public Utilities: Current Issues and Perspectives (1996)

One of the most important issues today concerns the deregulation of public utilities such as gas, electricity, water and telecommunications. This book deals with both the legal and economic aspects of the deregulation of public utilities. Chapters include the competition law framework for deregulation of public utilities; asset valuation and access to essential facilities under the Trade Practices Act; an economic analysis of the prices that public utilities should charge; a comparison of regulatory approaches and economic outcomes to deregulation of public utilities in Australia and New Zealand; and the experience with the deregulation of the Ontario Natural Gas and Electricity Industries.

Contributors include leading lawyers and economists such as Professor Michael Trebilcock of the University of Toronto, Professor Henry Ergas of the University of Auckland, Professor Philip Williams of the Melbourne Business School, David Goddard, World Bank Consultant on deregulation, and John Derham, Deputy Secretary and Director of the Privatisations and Industries Reform Division in the Victorian Treasury.

Ian Ramsay (editor), Gambotto v WCP Limited: Its Implications for Corporate Regulation (1996)

The judgment of the High Court of Australia in Gambotto v WCP Ltd is one of the most important decisions relating to:

• the rights of minority shareholders
• squeeze-outs of minority shareholders
• capital reconstructions
• disclosure obligations to shareholders
• amendment of company articles, and
• takeovers

Nine leading corporate law authorities evaluate the significant implications of the judgment.

• Professor Ian Ramsay - Key Aspects of Gambotto
• Damien Grave - Compulsory Share Acquisitions: Practical and Policy Considerations
• Professor Paul Redmond - Disclosure Obligations in Corporate Squeezeouts
• Quentin Digby - The Implications of Gambotto for Non-Takeover Aspects of Compulsory Acquisitions
• Ian Renard - The Implications of Gambotto for Takeovers
• Dr Elizabeth Boros - The Implications of Gambotto's Case for Minority Shareholders Professor Deborah DeMott - A United States' Perspective on Gambotto
• Michael Whincop - An Economic Analysis of Gambotto
• Saul Fridman - When Should Compulsory Acquisition of Shares be Permitted and, if so, What Ought the Rules be?

Phillip Lipton, The Authority of Officers and Agents to act for a Company: Legal Principles (1996)

One of the most important practical issues for companies and their advisers is the legal authority of agents and officers to act for a company. Many court judgments have recently added to the law in this area. Mr Lipton reviews both the statutory and judicial principles relating to corporate authority. The final chapter of the book provides practical advice to lenders in order to ensure that contacts by companies have been properly authorised.

This monograph is out of print.

The Contemporary Corporation: Current Challenges and Future Directions

The social responsibility of companies is an issue of significance for the entire economy, as well as for all people in their engagements with businesses and other enterprises. A workshop The Contemporary Corporation: Current Challenges and Future Directions, was convened at Flinders University, Adelaide, South Australia on 7–8 December 2021 by Vivienne Brand, Margaret Davies and Rosemary Langford, facilitated by a grant from the Academy of the Social Sciences in Australia. The workshop brought together a diverse range of legal and social science academics, commentators and representatives from law reform and legal practice. The workshop generated debate about the changing situation of corporations and the increasingly high standards of social responsibility to which they are held. It considered the problem of the corporate form from theoretical and regulatory perspectives with a view to informing current and future developments. Themes included corporate purpose and the corporate form; social licence to operate; environmental responsibility and directors’ duties reform. Papers from the workshop form the basis of two-part Special Issues of the Companies & Securities Law Journal. The first part is now available, comprising three articles offer contrasting and illuminating perspectives on the evolving corporate form.

Australian Prudential Regulation Authority (APRA) Modernising the Prudential Architecture Initiative

In 2022, Dr Andrew Godwin was appointed a member of the Advisory Panel for the APRA Modernising the Prudential Architecture Initiative. This initiative is a core strategic initiative to make the design of the prudential regulatory framework clearer, simpler and more adaptable.

Australian Law Reform Comission (ALRC) Review of the Legislative Framework for Corporations and Financial Services Regulation

In 2020, Dr Andrew Godwin was appointed Special Counsel and Team Leader in the ALRC Review of the Legislative Framework for Corporations and Financial Services Regulation. The Inquiry is part of the Government’s response to the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry released in February 2019.

Dispute Resolution in the Financial System

In 2016-2017 Professor Ian Ramsay chaired the independent panel appointed by the Australian Government to review the financial system’s external dispute resolution and complaints framework. The panel published two issues papers, an interim report and two final reports: Review of the Financial System External Dispute Resolution and Complaints Framework, Final Report, Commonwealth of Australia, 2017, 246 pages and Review of the Financial System External Dispute Resolution and Complaints Framework, Supplementary Final Report, Commonwealth of Australia, 2017, 204 pages. The panel made 11 recommendations in its final report. All these recommendations were accepted by the government. In February 2018 the Australian Parliament passed the Treasury Laws Amendment (Putting Consumers First - Establishment of the Australian Financial Complaints Authority) Act 2018 (Cth) which enacts the recommendations. In November 2018 the Australian Financial Complaints Authority commenced operation.

ASIC Enforcement Review Taskforce

In 2016-2017 Professor Ian Ramsay was appointed by the Australian Government to be a member of the Australian Securities and Investments Commission Enforcement Review Taskforce. During the review, the taskforce published 8 consultation papers on matters including the level of penalties for corporate and financial sector misconduct, ASIC’s power to ban individuals working in the financial sector, ASIC’s licencing powers, search warrant powers, and industry codes in the financial sector. In December 2017, the taskforce submitted its final report with recommendations to the Government. On 20 April 2018, the Commonwealth Treasurer, the Hon Scott Morrison MP, announced that the Government had agreed to all 50 of the Taskforce recommendations and would prioritise the implementation of 30 of the recommendations. In February 2019 the Australian Parliament passed the Treasury Laws Amendment (Strengthening Corporate and Financial Sector Penalties) Act 2018 (Cth) which enacts the recommendations.

Australian Securities and Investment Commission Enforcement Policies, Processes and Decision-Making Procedures Review

In 2018-2019 Professor Ramsay was appointed by the Chair of the Australian Securities and Investments Commission to be a member of the ASIC Enforcement Policies, Processes and Decision-Making Procedures Review. The terms of reference for the review stated that it should identify what changes should be made to ASIC’s enforcement policies to ensure they are aligned with internal and external expectations of ASIC and ensure ASIC obtains enforcement outcomes that are necessary for a fair, strong and efficient financial system for all Australians. The Review should particularly focus on policies, processes and decision-making procedures relevant to:

• whether or not to enforce the law using criminal and civil proceedings or other regulatory options; and
• the effectiveness and timeliness of the conduct of litigation and of enforcement outcomes.

The review submitted its report to ASIC in January 2019. In February 2019 ASIC announced that it had adopted the recommendations in the report including the establishment of an Office of Enforcement within ASIC.

Registered Charities and Governance

In 2017 Ian Ramsay and Miranda Webster published an article titled “Registered Charities and Governance Standard Five: An Evaluation”. In this article they noted that most charities must comply with a set of five governance standards to be registered as a charity by the Australian Charities and Not-for-profits Commission (ACNC). Governance standard 5 outlines the duties of the individuals who govern registered charities – the “responsible entities” of the charities (typically directors or management committee members). They argued that governance standard 5 has introduced increased complexity to the obligations of registered charities and to the duties of the individuals who are deemed to be responsible entities. They also argued that the ACNC governance framework has reduced the accountability of the individuals who work for registered charities that are incorporated under the Corporations Act 2001 (Cth). The article was cited in the 2018 Government report “‘Strengthening for Purpose: The Australian Charities and Not-for-profits Commission Legislation Review” and the report recommended that the duties in the Corporations Act that had been turned off in relation to responsible entities as a result of the introduction of governance standard 5 should be turned back on. In the Government Response to the report published in 2020,   the Government stated that it  would  release a consultation paper seeking the views of the sector on the merits and risks of turning back on the directors’ duties under the Corporations Act for charitable companies.

From 2018-2021 Rosemary Langford has undertaken a detailed ARC-funded project on governance and regulation of charities, which has resulted in numerous publications and recommendations. For details see: Restoring Public Trust in Charities.

Equity Crowdfunding in ASEAN

In 2016 Professor Ramsay was appointed by the Association of Southeast Asian Countries (ASEAN) as the consultant for the project on facilitating equity crowdfunding in ASEAN. In August 2017, ASEAN published Professor Ramsay’s co-authored report: Facilitating Equity Crowdfunding in the ASEAN Region (155 pages). The report is a detailed discussion of equity crowdfunding including the legal issues associated with this type of funding. The report provides a series of recommendations for member states of ASEAN which have not yet introduced equity crowdfunding on the key issues they should consider in designing a regulatory framework for equity crowdfunding. Prior to publication of the report, a two-day roundtable meeting on equity crowdfunding was held in May 2017 in Kuala Lumpur to consider and discuss the findings and recommendations in the draft report. Representatives from all ASEAN countries were present to hear Professor Ramsay present the findings of the research.

Legislative and Regulatory Complexity

The complexity of the Corporations Act 2001 (Cth) presents many challenges. These challenges include the costs that complex legislation imposes on the business community and on ASIC (Australian Securities and Investments Commission). This research investigated the increasing complexity of the Corporations Act from 1981 to 2015, and the regulatory burden caused to ASIC and to businesses. (Research article, Chia, H X and Ramsay, I, ‘Section 1322 as a Response to the Complexity of the Corporations Act 2001 (Cth)’, (2015) 33 Company and Securities Law Journal 6.

These research findings were cited in support of legislative reform to reduce regulatory red tape, in the 2015 capability review of ASIC (ASIC Capability Review: Report to Government pages 134-135).

Consumer protection: Reform of consumer lease contracts

Consumer leases can be an expensive and unhealthy form of consumer credit with some lenders targeting financially vulnerable consumers. This project investigated the experiences of consumers with consumer leases, and evaluated potential reforms to the regulations to ensure greater protection for consumers. (Research paper Consumer Leases and Consumer Protection: Regulatory Arbitrage and Consumer Harm (2013) by Paul Ali, Cosima McRae, Ian Ramsay and TJ Saw)

This research informed the Department of Treasury’s review of small amount credit contracts and consumer leases in 2015-2016 ( Department of Treasury, Review of the small amount credit contract laws, Consultation Paper, September 2015, p 36; Department of Treasury, Review of the small amount credit contract laws, Interim Report, December 2015, pp 12 and 26; and Department of Treasury, Review of the small amount credit contract laws, Final Report, March 2016, p 99)

Regulating Fraudulent Phoenix Activity

Fraudulent phoenix activity occurs where there is the deliberate liquidation of a company to avoid paying debts, but the business continues through another company. This causes huge losses in taxation revenue and large financial losses for employees and unsecured creditors. This research project aims to determine the optimal method of dealing with fraudulent phoenix activity, through a thorough examination of all of its aspects in Australia and by a comparative analysis of international responses.

Research findings have resulted in multiple submissions to government on ways to improve the regulation of fraudulent phoenix activity. See details about submissions on ‘Regulating Fraudulent Phoenix Activity’.

Financial Literacy Project

The Financial Literacy Project was the first in-depth study of the relationship between financial literacy and Australia's financial services and consumer protection laws. Through empirical research, the project contributed to a broader understanding of the role of financial literacy and consumer behaviour in Australia. See details about the project ‘Financial Literacy Project’.

The research team was invited to submit the summary results of the project for the Australian Securities and Investments Commission National Financial Literacy Strategy Review and Consultation Paper 'Shaping a National Financial Literacy Strategy for 2014-16'. Further information about the Financial Literacy Strategy Review is available here.

Employee Share Ownership Plans: Current Practice and Regulatory Reform

Employee share ownership plans (ESOPs) are important to the development of enterprise and innovation and the building of national wealth and savings. This project produced the first comprehensive analysis of how legal regulation structures and constrains the use of ESOPs in Australian enterprises. It examined the incidence and forms of ESOPs in Australia, the diversity of objectives that such schemes serve, the extent to which corporate, tax and labour law inhibit ESOPs, and the case for reform of the regulatory framework. This research enhances the capacity of policy makers to evaluate and identify appropriate regulatory techniques to ensure the growth of efficiency of ESOPs at the national and enterprise level.

Research findings from this project have resulted in multiple submissions to the government on reform of taxation of employee share schemes. See details of the project ‘Employee Share Ownership Plans: Current Practice and Regulatory Reform’.

Reform of the Australian Communications and Media Authority (ACMA) enforcement powers

In 2004, the ACMA asked Professor Ian Ramsay to examine the effectiveness of the ACMA’s existing enforcement powers and consider whether any reforms were needed in relation to these powers. His report formed the basis of the Government’s consideration of reforms to the ACMA’s broadcasting regulatory powers.

The report, Report for the Australian Communications and Media Authority on Reform of the Authority's Enforcement Powers (2005) by Ian Ramsay, made various recommendations to enhance the regulatory powers of ACMA by giving it new powers to impose civil penalties, injunctions, enforceable undertakings and infringement notices. These recommendations resulted in new legislative powers for ACMA, see details in the Explanatory Memorandum to the Communications Legislation Amendment (Enforcement Powers) Bill 2006.

Reforming Not-for-Profit Regulation

This project examined the appropriateness of existing corporate legal frameworks as they apply to not-for-profit (NFP) companies. It challenged the application of laws designed for companies with profit making objectives to NFP organisations. The project considered the issues of reporting and accountability to NFP stakeholders and how these stakeholders (and their needs) differ from those of stakeholders in 'for-profit' companies.

As a result of research findings, the research team recommended the establishment of a uniform regulatory regime for Incorporated Associations nation-wide, and made multiple submissions to government during legislative reviews in 2004. See details on the ‘Reforming Not-for-Profit Regulation Project’.

Dollar Disclosure of Fees in Managed Investments

In 2002 Professor Ian Ramsay was requested by ASIC to review the disclosure of fees and charges for managed investments, in Product Disclosure Statements (“PDSs”) and member or investor periodic statements. The report reviewed Australian disclosure requirements as well as international disclosure requirements, and proposed a number of options for improved disclosure. See the report Disclosure of Fees and Charges in Managed Investments (2002) by Ian Ramsay.

These recommendations were adopted in the Financial Services Reform Amendment Act 2003, and Prof Ramsay’s recommendations were discussed during the senate debate on the Financial Services Reform Bill 2003 (4 December 2003).

Prof Ramsay’s recommendations were also adopted by ASIC in the development of their fee disclosure model, see details in ASIC's media release.

Independence of Australian Auditors

In 2001 Professor Ian Ramsay conducted a review of the independence of company auditors, commissioned by the Minister for Financial Services and Regulation. The review was prompted by the view that Australian standards for regulating auditors had fallen behind international standards, and following the high profile failure of several major Australian companies with associated debate about perceived failures of auditor independance.

The review examined ways of limiting opportunities for conflicts of interest to arise in the performance of audits, and recommended several measures to restrict employment and financial relationships between auditor and client. Recommendations were made also to improve auditor supervision, disciplinary arrangements, auditor appointment and removal, and auditor accountability. Read the full report Independence of Australian Company Auditors (2001) by Ian Ramsay.

These recommendations were adopted in the Corporate Law Economic Reform Program (Audit Reform and Corporate Disclosure) Act 2004. See also discussion of Prof Ramsay’s recommendations in the Parliamentary Joint Committee on Corporations and Financial Services Report, CLERP (Audit Reform and Corporate Disclosure) Bill 2003: Part 2 Financial reporting and audit reform (June 2004).