The Challenge of Corporate Law Enforcement: Future Directions for Corporations Law in Australia

By Tomasic, Roman | University of Western Sydney Law Review, Annual 2006 | Go to article overview

The Challenge of Corporate Law Enforcement: Future Directions for Corporations Law in Australia


Tomasic, Roman, University of Western Sydney Law Review


Introduction

Much progress has been achieved in modernising Australian corporations law statutes over the last half century. (1) However, despite some impressive advances, much less has been achieved in enforcing or implementing corporations laws in Australia. In seeking to speculate about the future it is always desirable to look at the past as the seeds of future growth can often be found in past practices; this is to some extent an expression of the so-called path dependency argument that is illustrated by the characteristic features of every country's legal systems. (2)

Whilst Australia clearly does have its distinctive corporate law features that distinguish its governance arrangements from the usual Anglo-American models (3), it also has a large number of common features that it shares with other developed countries. Probably the most important of these are the background business culture, ethical values and legal institutions against which corporate laws operate; these are the most important ingredients in ensuring the effectiveness and enforcement of such laws. Australian corporations laws contain most of the elements that contemporary legal theorists have seen as being desirable in a 'modern' body of company law. (4) However, with increasing globalisation and the contraction of the role of the state in economic markets, the nature of modernity and the role of law have changed significantly since the enactment of the first broadly based company laws of the mid-nineteenth century. (5)

As a result, modern company laws have, and will continue, to be modified and adjusted to suit changing economic and legal circumstances. In Australia, over the last half century, this modernisation of company law has moved from the development of more uniform and more consistent bodies of legislation across the Australian States, followed by the passage of a comprehensive national Corporations Act in 2001. (6) We have also seen moves to simplify and streamline the content of this body of company law as well as to reduce the economic burden of such laws upon small to medium sized businesses. (7)

More recently, we have seen efforts to simplify the administration of Australian company law and to reduce the use of litigation as a means of enforcing this body of law, especially in areas such as takeovers (8) and voluntary administration of insolvent companies (9). In this regard, it should be noted that whilst corporate regulation in Australia has seen the corporate regulator, the Australian Securities and Investments Commission (ASIC), taking action 'to enforce and give effect to the laws of the Commonwealth that confer functions and powers on it', this is but one of six broad functional areas that the Commission needs to balance (with its limited resources) with other broader functions; these other areas relate to:

(i) Facilitating and improving the performance of the financial system;

(ii) Promoting the confident and informed participation of investors and consumers in this system;

(iii) Administering its laws effectively and efficiently;

(iv) Collecting and storing relevant information about companies; and

(v) Ensuring that information about companies is available to the public as soon as is practicable. (10)

In Australia we have also seen efforts to enhance the extent to which the Corporations Law is self-enforcing through the use of such mechanisms as the use of default rules in company constitutions (11), the introduction of statutory derivative action procedures, (12) and the imposition of liabilities on directors for the debts of their company in the event of insolvent trading, (13) and liabilities imposed on directors and others for misstatements in capital raising documents. (14) Duties placed on auditors have also been enhanced following a number of major corporate collapses in recent years. (15)

We have also seen an increase in the range and amount of financial and custodial punishments that may be imposed for breaches of the Corporations Act (16) and the introduction of new measures, such as infringement notices (17) and the civil penalty order procedure. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

The Challenge of Corporate Law Enforcement: Future Directions for Corporations Law in Australia
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.