Because of constitutional constraints on the powers of the Commonwealth, companies legislation was regard as a state matter. Each state had its own Companies Act in the early times. With the market development, Australia tried to uniform the companies legislation through different methods including the Co-operative Scheme in 1980s and the Corporation Act 1989. But the latter was held unconstitutional by the High Court.(1) However, a special solution was finally introduced, after a special agreement was made between the Attorneys-General of Commonwealth and six states, the Corporations Law became operative on 1 January 1991. In order to make it more logic, many of the older laws were restructured into it, so it "is unique in the world in that it contains in a single statute the laws relating to companies, accounts, securities markets, takeovers and insolvency".(2) It became incredibly complex with 22 chapters, two schedules and 1,362 sections. In 1991, there were 892,749 companies, of which 10,402 were public companies and the number of the listed companies was only 1,096,(3) but the Corporations Law applied to all these 892,749 companies despite of Titanics or tiny sampans. It was absurd, as the former Chief Justice of the High Court of Australia, Sir Anthony Mason, said in 1992 that:
"Oscar Wilde?would have regarded our modern Corporations Law not only as uneatable, but also indigestible and incomprehensible".(4)
It was really in need of reform. As the reaction, the Labor Attorney-General established in 1993 a Corporations Law Simplification Task Force to introduce the Corporate Law Simplification Program which was replaced in May 1997 by Liberal Federal Treasurer's Corporate Law Economic Reform Program (CLERP). Both the two programs have made substantive changes to the Corporations Law. Is the Corporations Law still complex?
The objective of the Corporate Law Simplification Program was to render the Corporations Law "capable of being understood so that users can act on their rights and carry out their responsibilities".(5) Accordingly, the Simplification Task Force targeted seven priority areas including small business, share buy-backs, capital rules, annual reporting, registers, company names and meetings, and three components for simplification, that was simplification of content, clarification of drafting and comprehensive consultation. As to simplification of content, the plan was to streamline the Corporations Law, procure consistency and coherence, strip away unnecessary complexities, maintain effective protection for investors and bring cost benefits both to and to relevant authorities. As to clarification of drafting, the program adopted principles of plain English to meet the needs of a variety of types of users. The program also called for extensive consultation particularly with those most closely associated with its operation and administration.
As the first stage achievement of the Simplification Task Force, the First Corporate Law Simplification Act 1995 (Cth) (The Simplification Act) came into force on 9 December 1995. It effected substantial changes in three areas: proprietary companies, share buy-backs and company registers.
The highlight of the Simplification Act is the introduction of a "Small Business Guide" as Part 1.5 CL and it is also available as a separate publication. In 11 sections it clearly outlines central rules including the rights, obligations and duties for most small business. The Simplification Act also made annual general meetings optional, reduced accounting and financial reporting requirements, and single director companies and single member companies are allowed.
Share buy-backs provisions is simplified both in content and in drafting through the replacement Part 2.4 Division 4B. The Simplification Act allows a company to buy back its own shares (other than redeemable preference shares) if it follows the procedures laid down, and makes same rules apply to all types of companies. It also replaces mandatory procedures involving auditors, experts, advertisements and declarations of solvency with new safeguards. All these provisions are included in 11 sections with about 3,000 words, compared to old provisions that were consisting of 89 sections using more than 20,000 words.(6)
The Simplification Act abolished several company registers. It worked out uniform rules in one place for registers of members, option holders and debenture holders.
Before the Simplification Act was finally passed, the Second Corporate Law Simplification Bill has been released for public consultation. As the Federal Government was changed, the Second Corporate Law Simplification Bill was replaced with the Company Law Review Bill 1997 and was finally passed in late June 1998 as the Company Law Review Act 1998 (Cth) (CLRA98) and commenced on 1 July 1998. The objective of the CLRA98 is stated as "to improve the efficiency of corporate regulation, and reduce regulatory burdens on business and other users of the Corporations Law."(7)
The CLRA98 made significant changes to the Corporations Law. The need of drafting a constitution was abolished. Existing companies may choose to maintain their original memorandum and articles of association as their corporate constitution, or to adopt a new constitution or repeal the memorandum and apply to the replaceable rules. Companies registered after 1 July 1998 can choose whether or not adopt a corporate constitution. The replaceable rules apply to all new companies unless they are displaced or modified by the corporate constitution.
As to the share capital, the changes include that the par value for shares and the concept of authorised share capital are abolished, the need for court approval for capital reductions and the shareholders' approval for financial assistance are also removed, and a number of changes are made with respect to the procedures for the issuing of shares.
Other features include that the procedures for establishing, running and de-registering a company were simplified, electronic commerce is to be encouraged for meetings and lodging documents with ASIC, the need to hold formal meetings for proprietary company is reduced, and the size of annual returns and the costs of annual reports are reduced.
While the contents are changed, the drafting was also clarified with plain English; as a result, there was a 43% reduction in words (from 95,000 words to 54,000 words).(8)
As mentioned above, the Corporate Law Simplification Program was replaces by the CLERP following the change of the Federal Government. The objective of the CLERP was "to ensure that business regulation is consistent with promoting a strong and vibrant economy and provides a framework which assists business in adapting to change".(9)
Accordingly, the reforms of companies and securities regulation aimed to "facilitate a more efficient and competitive business environment".(10) "As part of the Coalition Government's drive to promote business and economic development",(11) the CLERP adopted an economic approach to corporate regulation. The key principles include market freedom, investor protection, information transparency, cost effectiveness, regulatory neutrality and flexibility, and business ethics and compliance. The main features of the reform agenda are summarised as follows:
1.facilitating corporate fundraising, including improving disclosure and facilitating fundraising by small and medium sized enterprises;
2.improving corporate governance, including clarifying directors' duties and greater accountability to shareholders;
3.making accounting standards more useful for business;
4.streamlining takeover rules, including mandatory bid, compulsory acquisitions, takeovers panel and listed managed investments;
5.fostering electronic commerce; and
6.streamlining regulation of financial markets and products.
After the CLERP has released seven Proposals, of which the first four were incorporated into the CLERP Bill, which was passed on 20 October 1999 as the CLERP Act, which commenced operation on 13 March 2000.
The CLERP Act made significant changes to the Corporations Law relating to directors' duties and corporate governance, fundraising, takeovers and accounting standards.
The most significant change relating to directors' duties and corporate governance is the introduction of a business judgement rule. There was uncertainty as to the personal liability of directors for decisions made in good faith before this change was made. Now directors will be assumed to have fulfilled their duty of care if they satisfied the pre-conditions. The ability of directors to delegate functions and to rely on the advice of others was also clarified. The rights of shareholders were also enhanced. Shareholders are allowed to bring proceedings on behalf of the company where the company is either unwilling or unable to do so.
As to takeover provisions, the CLERP Act makes the Corporations and Securities Panel the primary forum for the resolution of takeover disputes during the bid period and prohibits the parties from applying to the court. It allows all types of securities to be compulsorily acquired at any time. And it will be much easier for the holder of 90% or more of shares in a company to mop up the rest by compulsory acquisition. It is believed that changes will simplify takeovers, make them more certain and more commercial.
The most important amendment made to the fundraising provisions is the introduction of shorter prospectuses, which were traditionally long, complex and difficult to understand. The need to issue a prospectus for small business is also reduced. So, now it is simpler and cheaper for small business to raise corporate funds.
The changes of accounting standards are related to the Australian Securities and Investments Commission Act 1989.
From the overview of the main changes made to the Corporations Law during the last decade, we can conclude that the Corporate Law Simplification Program and the CLERP made different endeavour to change the Corporations Law, and accordingly they have the different impact to the Corporations Law.
The objective of the Corporate Law Simplification Program was to make the Corporations Law understandable, so it aimed to simplify both the content and the drafting. The Simplification Act was a good start of its planned endeavour. It made substantial changes to the law relating to proprietary companies, share buy-backs and company registers. The Second Corporate Law Simplification Bill was to continuously simplify the Corporations Law. Both of the two not only significantly simplified relevant requirements and procedures, but also dramatically reduced the words. In my opinion, the introduction of the "Small Business Guide" is one of the greatest achievements of the Corporate Law Simplification Program, and it is a wonderful model for simplifying the Corporations Law. Unfortunately, its endeavour to simplify the Corporations Law was suspended due to the change of Federal Government, although the Second Corporate Law Simplification Bill was mainly included in the CLRA 1998.
The CLERP has also made significant changes to the Corporations Law, but as it is "a major element of the Government's overall economic program",(12) all the modifications are aimed to promote efficiency in the Australian economy and increase the protection of investors. The simplification is one of the elements it concerned, but it is no longer its main objective. There is no doubt that CLERP Act has clarified directors' duties, and simplified the provisions of takeovers and fundraising, but simplification is only a by-product of efficiency.
By now, after more than a dozen of alterations, it seems that the Corporations Law is still unreasonable complex, even more complex than ever to some extent, although some endeavours have made to simplify it. There are 1493 numbered sections plus many inserted sections, the actual total number of sections are over 1,800, some of which are meaningless. There are also too many cross-references that are too far from clarity. Perhaps it is a good suggestion to divide the Corporations Law into several different acts apply to different companies, and to make further more endeavours to simplify each part when it is divided.
Footnotes:
1.NSW, SA & WA v Commonwealth of Australia (1990) 169 CLR 482; 1 ACSR 137
2.Adams, M A; "Developments in Australian and UK Corporate Law and Governance" (1998) 4 Corporate Governance International 22.
3.Adams, M A; Corporations, Finance and Securities Law, Class Materials 3.
4.Mason, Sir Anthony; "Corporate Law: The Challenge of Complexity" (1992) 2 Australian Journal of Corporate Law 1.
5.Attorney-Generals Department, Corporations Law Simplifications Program,Task Force, Plan of Action, Barton, ACT, 1993, 1.
6.Jenny Wily, Corporations Law Update - Simplification, Corporations Law:paper presented for the Continuing Legal Education Department of the College of Law on Wednesday,27th March 1996
7.Company Law Review Bill 1997 Explanatory Memorandum.
8.Adams, M A; Corporations, Finance and Securities Law, Class Materials 1.
9.CLERP, Policy Framework
10.CLERP, Policy Framework
11.CLERP, Policy Reforms
12.CLERP, Policy Framework
Bibliography:
1.Attorney-Generals Department, Corporations Law Simplifications
2.Program, Task Force, Plan of Action, Barton, ACT, 1993, 1;
3.CLERP, Policy Framework;
4.CLERP, Policy Reforms;
5.Company Law Review Bill 1997 Explanatory Memorandum;
6.CLERP, Commentary on Draft Provisions;
7.Adams, M A; Corporations, Finance and Securities Law, Class Materials;
8.Adams, M A; "Developments in Australian and UK Corporate Law and Governance",(1998) 4 Corporate Governance International 22;
9.Jennifer Hill; "CLERP: What it Means for Corporate Australia",(2000) 1 Australian Company Secretary 18;
10.Jenny Wily, "Corporations Law Update - Simplification" - paper presented for the Continuing Legal Education Department of the College of Law on Wednesday,27th March 1996;
11.Jenny Wily; "Recent Developments in the Corporations Law"- paper presented for the Continuing Legal Education Department of The College of Law on Wednesday,19th March 1997;
12.H A J Ford and I M Ramsay; A Guide to the First Corporate Law Simplification Act 1995 (Cth),Butterworths 1996;
13.David Roberts, "Company Law Review Act 1998" - paper presented on 16th September 1998;
14.David Wishart; "The Politicization of Corporate Law Reform"- paper presented at Corporate Law Teachers' Association Conference 1999 at Monash University;
15.Brian Burnett (Consultant author); 2000 Australian Corporations Law, CCH Australia Limited;
16.Latest CLERP changes good news for companies and fundraising, @ 2000, Freehill Hollingdale & Page, http://www.brw.com.au/specials/lawnotes/clerp.htm
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杨春宝一级律师简介
杨春宝一级律师，大成上海高级合伙人、资本市场部主任、国资基金研究中心主任，大成中国区私募基金专业带头人、科技与文化法律研究中心联合牵头人。执业30余年，长期从事私募基金、投融资、并购重组法律服务，尤其对对赌研究颇深且具有非常丰富的实战经验，并专注于金融机构股权投资业务。2004年起多次入选The Legal 500"私募基金"和"公司与商业"等境内外各类律师榜单，代理的中国法院首例适用外国法律审理外国公司的董事损害小股东权益纠纷案入选上海高院发布的《上海法院域外法查明典型案例》和威科先行"要案头条"。入选上海涉外法律人才库、上海市司法局鼎新法治人才库、上海国有企业改制法律顾问团，具有上市公司独立董事任职资格，系多家知名高校的兼职教授或兼职研究生导师及上海市商务委跨国经营人才培训班讲师。出版《私募股权投资基金风险防控操作实务》等16本投融资法律专著。了解更多常见法律问题
澳洲公司法为何曾被批评过于复杂？
澳大利亚公司法曾被批评复杂的主要原因在于其历史形成背景与立法结构。由于宪法对联邦权力的限制，公司法最初由各州分别立法，导致规则不统一。为协调各州利益，联邦与各州通过协议方式于1991年施行统一的《公司法》，但该法将公司、会计、证券市场、并购与破产等全部规则纳入单一法律文本，共含22章、两个附表及1362条，规模空前。与此同时，当时全澳约89万家公司中，上市公司仅约一千家，绝大多数为规模微小的小型企业，却需适用同一套繁重规则，明显缺乏比例性。曾任高等法院首席大法官的安东尼·梅森爵士甚至借用奥斯卡·王尔德的话讽刺该法“不可食用、难以消化且无法理解”。实务中，企业为满足合规要求需负担高额咨询与文书成本，尤其是小型企业难以承受。立法语言晦涩、程序冗余、资本规则复杂等问题严重阻碍了市场效率，因此被广泛视为亟需改革。这一批评直接催生了后续的公司法简化运动。
公司法简化计划采取了哪些具体措施？
澳大利亚公司法简化计划主要由两个阶段性立法体现。1995年生效的《公司法简化法》首先针对小型企业、股份回购、资本规则、年报、登记簿、公司名称与会议共七个优先领域展开改革。其核心措施包括：引入“小型企业指南”，以简明语言集中说明小型企业的主要权利义务；允许单一董事公司与单一股东公司；将年度股东大会改为非强制；大幅削减会计与财务报告义务；简化股份回购程序，将原需89个条文、两万余字的规定压缩为11个条文约三千字；统一成员登记簿、期权持有人登记簿与债券持有人登记簿规则，并废除部分冗余登记簿。1998年生效的《公司法审查法》进一步推进改革，内容包括：废除强制制定章程的要求，引入“可替换规则”，允许新公司自行选择是否采纳章程；取消股票面值与法定资本概念；废除减资须经法院批准及财务资助须股东批准的程序；简化公司设立、运营与注销流程；促进电子通讯方式召开会议及向监管机构提交文件；减少年度申报表与报告成本。在文本层面，通过平实语言重写，法律字数从约九万五千词降至五万四千词，降幅达百分之四十三。这些措施显著减轻了企业的合规负担，尤其惠及小型企业。
公司经济改革计划与简化计划有何不同？
公司经济改革计划（CLERP）是1996年联邦政府更迭后，由自由党政府推出的后续改革方案，取代了此前的公司法简化计划。两者的根本差异在于指导理念：简化计划以“使法律可理解、用户能行使其权利”为主要目标，侧重于语言平实化与规则去复杂化；而经济改革计划则明确采用经济学路径，强调通过促进市场自由、保护投资者、保障信息透明度、实现成本效益、维持监管中立与灵活性，并强化商业伦理与合规来营造具有国际竞争力的商业环境。在具体内容上，经济改革计划涵盖六大主题：一是便利企业融资，改进信息披露并支持中小企业筹资；二是完善公司治理，厘清董事义务并强化对股东的责任；三是使会计准则更贴合商业实践；四是精简收购规则，包括强制要约、强制收购、收购委员会及上市管理投资计划；五是促进电子商业的应用；六是精简金融市场与产品的监管框架。该计划陆续发布多份改革提案，其中前四项被整合为立法草案并获通过。与简化计划相比，经济改革计划更注重制度设计对经济效率和市场活力的激励作用，而不仅是法律文本的可读性，标志着澳大利亚公司法改革从“减法”转向“优化”。二者共同推动了公司法向现代化、市场化方向演进。
以上内容仅供参考，不构成法律意见。如需专业法律服务，请联系杨春宝一级律师：chambers.yang@dentons.cn
