New Corruption And Foreign Bribery Legislation

In March of this year the Australian Parliament introduced new legislation aimed squarely at corporate corruption and foreign bribery. The Crimes Legislation Amendment (Powers, Offences and Other Measures) Bill 2017 operates to amend the existing corruption and foreign bribery provisions in the Criminal Code Act 1995 (Cth).

The Bill imposes absolute liability on not only Companies and individuals, but seeks to ‘pierce the corporate veil’, by making corporations liable for the actions of their subsidiaries, contractors and any third-party entity who provides services or acts on behalf of the company.

YL TV: Australia's New Payment Platform

This week on You Legal TV, we take a look at Australia's new payments platform. It was first proposed to enable real-time payments via all of the nation’s financial institutions by 2016. Using this platform, payment provider BPay allows individuals to transfer funds to others using just their mobile phone number and email address. Watch the episode here:

See below for complete transcript of this episode -

Hello, and welcome to You Legal TV.

Australia's new payments platform (NPP) was first proposed to enable real-time payments via all of the nation’s financial institutions by 2016.

Using this platform, payment provider BPay allows individuals to transfer funds to others using just their mobile phone number and email address.

NPP also enables same-day settlement of bulk and direct payments, real-time retail payments, and the ability to finalise low-value payments outside banking hours.

With this real-time service, financial exchanges can perhaps be more secure as you can immediately determine if the payment has gone to the right party.

The NPP is on track to being operational in 2nd half, 2017. So watch the space.

But if you do have any quary that have the NPP relavant, feel free to get in touch, because as always we're happy to help.

Read About the Franchising Code of Conduct

 
What Should I Do Next?

Contact us if you would like to have more information in relation to New Payment Platform (NPP). Our lawyers at You Legal will be happy to assist you in whatever way we can.

* This blog is for general guidance only. Legal advice should be sought before taking action in relation to any specific issues.

6 Things to Consider If Your Contracts Have Automatic Renewal Terms

The ACCC has its eyes on automatic renewal terms in contracts with the set of new laws that seek to extend the provisions of unfair contract terms in the Australian Consumer Law to small and medium businesses. This calls for careful examination of automatic renewal terms when using them in business contracts. 

The Franchising Code of Conduct: An Overview

The franchising industry is now heavily regulated by Australian Competition and Consumer Commission (ACCC). The ACCC has embarked on a new, revolutionary regime under the Franchising Code of Conduct 2015. 

The Code prescribes a particularly high standard of conduct for franchisors. Of the 24 civil penalty provisions set out in the Code, 22 provisions relate to breaches by the franchisor. The Code also introduced new requirements including the good faith and disclosure obligations. With these in mind, the risks of breaching the Code should be managed by a comprehensive franchising strategy.

 

3 Types of Personal Assets to Protect

The unexpected can happen to any business, and the creditors come calling for their money. How do business owners and directors protect their assets from this eventuality?

YL TV: 3 Penalties for Misclassifying Employees

This week on You Legal TV, we take a look at Contractor vs. Employee. If you misclassify your employees as contractors, there can be costly consequences if found out by the ATO! Watch the episode here:

See below for complete transcript of this episode -

Welcome to You Legal TV.

For many SMEs, contractors are a flexible solution to staffing needs – particularly if you are sourcing very specific skills or expertise. But beware: there can be costly consequences if you misclassify employees as contractors.

If the ATO rules that someone you have engaged as a contractor is in fact an employee, you will be liable to pay their PAYG withholding tax for their period of employment and all unpaid superannuation. You might also have to pay additional penalties.

The ATO and the courts will make the distinction between a contractor and an employee by looking at the structures of the working relationship. This includes: the control and independence they have over their working hours and location, who shoulders the cost of work equipment, risk allocation, among other factors.

Visit our blog for more information on tax risk management or contact us for advice on your legal obligations. We’re always happy to help.

The Dangers of Misclassifying Employees

 
What Should I Do Next?

Contact us if you would like to have more information on classifying an Employee vs a Contractor. Our lawyers at You Legal will be happy to assist you in whatever way we can.

* This blog is for general guidance only. Legal advice should be sought before taking action in relation to any specific issues.

Contractor vs. Employee: 3 Penalties For Misclassifying Employees

A contractor vs. an employee - Do you know the difference? For many SMEs, contractors are a flexible solution to staffing needs – particularly if you are sourcing very specific skills or expertise. However, there are dangers associated with misclassifying employees as contractors.

The ATO can rule that someone you have engaged as a contractor is in fact an employee for tax and superannuation purposes, and the consequences can be costly!

1. PAYG

If your contractors are in fact employees, you will be liable to pay their entire PAYG withholding tax for their period of employment. Depending on the circumstances and length of employment, the ATO may also impose additional penalties.

Importantly, the Australian Taxation Legislation triggers personal liability for Directors who are responsible for meeting PAYG obligations.

2. Superannuation

Classifying employees as contractors has even greater consequences under the superannuation legislation. You will be immediately liable for all unpaid superannuation, calculated at 9.5% of their income, plus interest at 10%, an administration fee, and an additional Superannuation Guarantee of up 200%.

YL TV: Share Subscription Agreement

This week on You Legal TV, we take a look at the structure of Share Subscription Agreement. Watch the episode here:

See below for complete transcript of this episode -

Welcome to You Legal TV.

You’ve wooed investors with your pitch, set out the Term Sheet and prepared the Share Offer document, but you may find that experienced venture capitalists will also expect a Share Subscription Agreement.

This Agreement will typically contain five types of clauses:

  1. Representations and warranties of the investor;
  2. and also of the company;
  3. Conditions precedent, which set out who needs to do what before the Agreement comes into force;
  4. Confidentiality; and
  5. The Tranches clause setting out the details of the deal found in the term sheet.

While the document contains clauses that benefit both parties, a Share Subscription Agreement is ultimately a document for the benefit of the investor.

Visit our blog for more information or contact us for advice on your legal obligations. We’re always happy to help.

The Anatomy of a Share Subscription Agreement

 
What Should I Do Next?

Contact us if you would like to have more information on drafting up a Share Subscription Agreement. Our lawyers at You Legal will be happy to assist you in whatever way we can.

* This blog is for general guidance only. Legal advice should be sought before taking action in relation to any specific issues.

Big Data in Agriculture: 4 Legal & Security Risks You Must Consider

Big data has taken different sectors of the economy by storm and Agriculture is not any different. It is being used in technologies involved in monitoring crops and animals, making paddocking decisions, deciding on the application of fertilizers and chemicals, and the prediction of possible problems. Big data is also used in soil moisture-sensing technologies, checking of pastures and management of the livestock. 

You Legal Vivid Vision 2020

This is You Legal’s 2020 Vivid Vision. Crafting a Vivid Vision brings the future into the present so we can have clarity on what we are building now. It is a detailed overview of what You Legal will look like, feel like and act like three years out – by 31 December 2020. Sharing it with others helps it become reality.

Here at You Legal we have always been very open about chasing big dreams, so we’re fired up to share this with you-- this is our vision for what You Legal will look like in 2020. We are planning for some big growth, and by being completely open and sharing what we see the firm looking like in three years’ time, we hope you’ll help us get there. If it wasn’t for the team we have, this kind of dreaming wouldn’t even be possible—thank you for your hard work in making You Legal the great firm it already is, and look out, 2020!

The Anatomy of a Share Subscription Agreement

A Share Subscription Agreement will set out the who, how, what and when of a share issue, but more importantly, it will set out any warranties and representations made to an investor.

Representations and Warranties of the Purchaser/Investor

The Share Subscription Agreement will often contain various representations and warranties made by the investor. While the document contains clauses that benefit both parties, a Share Subscription Agreement is ultimately a document for the benefit of the purchaser. If your investor has not requested it, it is not necessary to volunteer it. You may however find that experienced venture capitalists will expect one.

Your legal advisor is best placed to make sure that your agreement contains the representations and warranties necessary for your individual deal, however the following are examples of a few of the most common clauses:

  • That the purchaser is not entering in the agreement with knowledge that has not been publicly disclosed (insider trading)
  • The purchaser has received all relevant copies of documents relating to the company such as any memorandum of offering
  • The purchaser may make a warranty to the effect that they are able to meet their financial commitment and fulfil their obligations under the agreement.

Representations and Warranties of the Company

Your investor will, in all likelihood, make specific demands about what they want represented, none of which should come as a surprise following the negotiation and Term Sheet stage of the investment.

The warranties contained in a share subscription agreement can be broad such as a warranty that the company has the authority to enter into the agreement, that all relevant information has been provided to the investor, and that the directors or founders are not aware of any additional information that may affect the investment.

Warranties may also be very specific, such as a warranty that the company owns the relevant licenses and/or intellectual property necessary to conduct its business.

Peter Vogel v. Fairlight: The Importance of a Written Agreement

A written agreement is an important part of a contract and guarantees the rights of the parties in case of a breakdown in the business relationship.

Directors Responsibilities in Tax Risk Management

This week on You Legal TV we discuss about how it has never been as important as now to consider Tax Risk Management. Watch the episode here:

See below for complete transcript of this episode -

Welcome to You Legal TV.

In January, the ATO released a new Tax Risk Management and Governance Review Guide, highlighting directors’ responsibilities in their company’s tax risk protocols.

The Guide calls for effective policies to be put in place to assess any potential tax implications of company transactions. Cases where there is high tax risk include:

  • Restructures, consolidations mergers and acquisitions;
  • Transfer pricing and international transactions;
  • Historical performance that is inconsistent with industry benchmarks;
  • Unexplained losses that are carried forward for a long period of time; and
  • Tax minimisation arrangements.

Ideally, a company’s risk management framework should be updated regularly. If a company is found in breach of tax laws, directors can be held personally liable.

Visit our blog for more information on tax risk management or contact us for advice on your legal obligations. We’re always happy to help.

The ATO’s Call for Proactive Tax Risk Management in 2017


What Should I Do Next?

Contact us if you would like to have any advice on mamnaging tax riskOur lawyers at You Legal will be happy to assist you in whatever way we can.

* This blog is for general guidance only. Legal advice should be sought before taking action in relation to any specific issues.

The ATO’s Call for Proactive Tax Risk Management in 2017

It has never been as important as now to consider tax risk management.

In January, the ATO released a new Tax Risk Management and Governance Review Guide, highlighting directors’ responsibilities in their company’s tax risk protocols. Last November, the Federal Court also affirmed directors’ common law and statutory duties to act with care, skill and diligence in dealing with their company’s tax risk management. These events show a shift in the ATO’s treatment of corporate tax management.


The ATO’s Review Guide represents their position in encouraging directors to take a more proactive approach to tax management. Although the ATO has not introduced new tax management duties in its updated guide, it has elaborated on existing ones.

The review guide affirms that while the everyday control of compliance is often handled by managers, directors are responsible for overseeing an internal control framework that informs managers of how tax risks are identified and managed.

It is also directors’ responsibility to be able to show the ATO that these controls are operating effectively. To achieve this, regular control testing and auditing should be conducted.

Understanding Tax Risk Implications

The Guide calls for effective policies to be put in place to review and assess tax implications of material company transactions. Special attention needs to be given to high tax risk events, such as:

  • Restructures, consolidations mergers and acquisitions, and related party transactions;
  • Transfer pricing and international transactions;
  • Historical performance that is inconsistent with industry benchmarks;
  • Unexplained losses that are carried forward for a long period of time;
  • Tax minimalisation arrangements.

Recent high Court decision on Penalties and Damages Clauses

This week on You Legal TV we discuss about the recent High Court case of Paciocco v ANZ. Watch the episode here:

See below for complete transcript of this episode -

Welcome to You Legal TV.

What are the lengths you’ll go to avoid late payment fees from your bank?

The recent case of Paciocco v ANZ related to late payment, overdraft and dishonour fees of between $20 and $35. Paciocco claimed fees charged by ANZ were out of proportion to the loss suffered, and should at law be considered a 'penalty' - therefore void and unenforceable.

The High Court did not agree with Paciocco and ruled that the fees were not a penalty. The Court agreed that regulatory and operational costs do increase when customers fail to pay their bills on time, but that the fees were not an estimate of direct 'loss' for ANZ.

This decision has paved the way for a greater scope of costs to be calculated in damages clauses, including both direct and indirect costs.

Visit our blog for more information or contact us for advice on your commercial contracts.

Penalties and Damages Clauses: How a Recent High Court Decision Affects Your Contracts.


What Should I Do Next?

Contact us if you would like to have any advice on your commercial contractsOur lawyers at You Legal will be happy to assist you in whatever way we can.

* This blog is for general guidance only. Legal advice should be sought before taking action in relation to any specific issues.

Penalties & Damages Clauses: How a Recent High Court Decision Affects Your Contracts

In the unfortunate event you are faced with a breach of contract by another party, it’s important to know that the damages clause in your contracts enables you to recover as much of the loss suffered as possible.

Damages clauses have traditionally been drafted conservatively so as to avoid the law against ‘penalties’, but a recent High Court decision has changed the legal landscape for damages and paved the way for greater scope of costs and other legitimate business interests to be calculated in damages clauses.

What is a Penalty Clause?

Most contracts contain provisions as to liquidated damages: a specified sum of money payable by a party in breach of the contract to the innocent party. A builder who fails to complete a project on time, a supplier who does not meet delivery or a breach of a confidentiality clause are a few common examples which may attract liquidated damages.

Importantly, any clause setting out liquidated damages must be a genuine pre-estimate of loss suffered by the innocent party.

The law against penalties provides that where such a clause is ‘out of proportion’ to the potential damage, or ‘extravagant and unconscionable’, it will be considered a ‘penalty’ and therefore void and unenforceable.

The Case

The recent case of Paciocco v Australian and New Zealand Banking Corporation [2016] HCA 28 concerned a claim that the late payment fees, overdraft fees and dishonour fees charged by ANZ on various banking facilities were excessive and out of proportion to the loss suffered by ANZ and were therefore invalid penalty clauses.

The disputed fees were between $20 and $35.

On appeal from decisions in both the Federal Court and Full Court, the High Court ruled that although the fees were not an estimate of ‘loss’, they were calculated having regard to the ‘legitimate business interests’ of ANZ.

The Court held that when considered against the value of an individual credit card, the fees might have appeared excessive. However, late payments resulted in flow-on consequences and gave rise to additional costs, including regulatory capital requirements, operational costs associated with debt recovery, and provisioning costs associated with the risk of outstanding debt.

The Court held that these costs increased due to customer failure to meet their contractual obligations and pay their credit card bill on time.

What does this mean for your contracts?

Damages clauses have traditionally been drafted with caution so as not to trigger the law against penalties. The High Court decision however has taken a broad view and determined that damages are not limited to loss resulting directly from a breach of the contract, but may include a wide range of legitimate business interests.

The Paciocco case has reinforced the Court’s increasing support of freedom to contract and is a timely reminder to review your commercial contracts particularly if your business uses standard form contracts. You should be carefully considering all legitimate business interests and costs arising from a breach of your contracts, including regulatory compliance and operational costs.

 
What Should I Do Next?

Contact us if you would like to have any advice on your commercial contracts, our lawyers at You Legal will be happy to assist you in whatever way we can.

Download Our E-Book

* This blog is for general guidance only. Legal advice should be sought before taking action in relation to any specific issues.

Digital Disruption in the Boardroom

This week on You Legal TV we discuss about the technology that may or may not apply to your business model. Watch the episode here:

See below for complete transcript of this episode -

Hello, welcome to You Legal TV.

Technology is developing at an excitingly rapid pace, and in the Boardroom we must keep up to date to ensure the survival of our organisations. Focus is often placed on data security but technology should also play a role in corporate governance. There are four main categories of technology to consider for your business model:

  1. Human Enhancement Technology;
  2. Collaboration Technology;
  3. Augmented Technology; and
  4. The Internet of Things.

More purposeful conversations should be had in the boardroom to embrace the capacity of technology to make your business safer, more efficient and ultimately... more profitable!

Read more about this topic in our blog link below, and if you have any questions feel free to give us a call or shoot us an email, we would love to assist you if we can.

Top 4 Factors to a Successful Technology Plan in Your Business


What Should I Do Next?

Contact us if you would like to have more information on creating a technology plan and managing the legal risks involved in the process.  Our lawyers at You Legal will be happy to assist you in whatever way we can.

* This blog is for general guidance only. Legal advice should be sought before taking action in relation to any specific issues.

4 Ways to Integrate Technology Into Your Corporate Strategy

The Corporations Amendment (Crowd-sourced Funding) Bill 2016 has finally passed. From September 2017, retail investors will have a chance to buy up to $10,000 in the form of equity in business startups after the Senate passed the crowdsourcing legislation. The bill allows unlisted public companies that have gross assets of up to $25 million to advertise their business ideas to crowdfunding portals that are licensed and raise up to $5 million a year. The investors are allowed to invest to a maximum of $10,000 a year to any number of business plans.

While the bid for Labor opposition to have the law apply immediately to proprietary firms was unsuccessful, this new legislation is an exciting new framework for qualifying businesses and startups to expand through non-traditional means.

As lawmakers begin to place an increasing amount of focus in accommodating and regulating innovation, it’s time for leaders to review the role of various technologies in their businesses.

Technology matters in your boardroom. We aren’t just referring to projectors, laptops and the other communication devices that we use to facilitate and conduct board meetings.

We are talking about what it means to your business in the marketplace and how you can fully engage in discussion about digital disruption in the boardroom.

Technology is developing at an excitingly rapid pace, and innovation has become an essential part of driving the growth and efficiency of businesses.

Main Categories of Technology

There are hundreds of kinds of technology that may or may not apply to your business model. These may be divided into four generally accepted categories.

Human Enhancement Technologies include technologies designed to enhance human capabilities such as memory, sight and hearing. They include electronic do do lists and filing systems and, when integrated across your entire company are an invaluable tool.

Collaborative Technologies include peer to peer, and data sharing. Uber is the perfect example of a collaborative technology that took an idea as simple as ride sharing and turned it into an international, multimillion dollar company that has completely disrupted the taxi industry.

Also known as Virtual Reality, Augmented Technology is more than just The Sims. It is a view of the real world environment whose elements are augmented or supplemented through computer generated sensory input.

Google Maps world view is Augmented Reality. When you ‘check in’ to a restaurant on Facebook you are participating in augmented technology that allows you to share your experience with friends despite the absence of their physical appearance.

Augmented Technology is the next big thing in retail. When you check in to your local shopping centre you can receive alerts about specials from your favourite retailers based on your preferences and browser history. This is not the future. It is the present, and your board needs to be discussing it.

The Internet of Things refers to the network of physical devices, buildings, cameras with network connectivity that allows them to collect and exchange data, for example a home security system that calls your security company when triggered.

The Internet of Things generates huge amounts of user data that can be captured and used to gauge how your customers engage with your product.

The purpose of discussing the types of technology is to bring your attention to something that may seem irrelevant in the boardroom but is in fact extremely relevant to your business model.

The right technology can not only increase your productivity and profitability, but can, in some cases, genuinely underpin its capacity to survive.

Your Corporate Strategy

There are four factors to a successful technology plan.

  1. People
  2. Process
  3. Advice
  4. Leadership.
1. PEOPLE

Your company no doubt has a sales team, a finance department and a business manager. But does it have an IT person to manage the IT concerns and aspirations of a business your size (whatever that may be)?

Your board should be liaising with your IT manager, listening to their views and engaging them to drive IT projects, whether they be maintenance, security or innovation.

2. PROCESS

Technology is often implemented on an ‘ad hoc’ basis. How many times are the following phrases used in your company:

“This solution is the cheapest. Let’s use it”

“This program wont work because no one knows how to use it”

“This program is too expensive. We can’t afford it”

Boards need to adopt a process that considers options in terms of immediate and long term goals as well as what any financial constraints and other considerations such as staff training.

3. ADVICE

For smaller projects, invite your IT manager to present to the board to make sure that it is understood by all board members what the technology is and how it is going to affect the company.

For larger projects, external advice from IT experts can be worth seeking. Just as you would engage a lawyer for a legal project and an engineer for a building one.

4. LEADERSHIP

Once your board has engaged the right people, followed its process and sought relevant advice they should have the confidence they need to make IT decisions that affect the company. Each director should be fully equipped to have meaningful discussions and technology and confidently play a role in its governance.

RISK

We can’t discuss leadership without risk. It is a topic most directors are familiar with and some of us often feel like it’s the only thing we deal with. Technology risks are no exception.

Directors often feel like they must choose between innovation and risk management, but there is another risk at play here. Innovation vs obsolescence.

The same four factors can be used to reduce risk. What you can do:

  • Engage IT people to monitor and identify risk.
  • Implement a company wide process for dealing with risk factors.
  • Seek advice.

Technology shouldn’t be the elephant in the room at your board meetings, and strong leadership will be integral to making technology a mainstay of discussion and implementation in companies.

With these four steps, you can lead your company away from the fear of technology and embrace its capacity to make your business safer, more efficient and ultimately… more profitable!

 
What Should I Do Next?

Contact us if you would like have more information on integrating technology into your corporate strategy and managing the legal risks involved in the process. Our lawyers at You Legal will be happy to assist you in whatever way we can.

* This blog is for general guidance only. Legal advice should be sought before taking action in relation to any specific issues.

Update on Kylie vs Kylie

This week on You Legal TV we provide an update on the dispute between Kylie Minogue and Kylie Jenner to trademark the name “Kylie”. Watch the episode here:

See below for complete transcript of this episode -

Hello, welcome to You Legal TV.

You may recall that Kylie Minogue and Kylie Jenner have been arguing over the right to trademark the name “Kylie”. Well, Minogue has won the battle with Jenner, after Minogue’s lawyers sent the US Patent and Trademark Office a long list of reasons why Jenner should not be granted the trademark.

Minogue’s lawyers described Jenner as ‘a secondary reality television personality’ and the letter argued that, in contrast, Minogue was an ‘internationally-renowned performing artist, humanitarian and breast cancer activist known worldwide simply as “Kylie”.

Last week, the Patent Office rejected Jenner’s application. Jenner, who wants the name for her clothing and beauty-empire, has already lodged an appeal.

If you have any questions about trademarks, feel free to give us a call or shoot us an email, we would love to hear from you.


What Should I Do Next?

Contact us if you would like further legal advice on trademarks or other intellectual property issuesOur lawyers at You Legal will be happy to assist you in whatever way we can.

* This blog is for general guidance only. Legal advice should be sought before taking action in relation to any specific issues.

Introducing Gumption Trigger

How do we recover from an epic hit to our career or personal life? We pull our 'Gumption Trigger'. Read the stories of 14 women who each share a story of embracing vulnerability and navigating unexpected upheaval in this new and compelling book. Real stories of grit and determination by real businesswomen, entrepreneurs and innovators. Curated by Dr Catherine Ball. Buy it here:  www.gumptiontrigger.com

See below for complete transcript of this episode -

Welcome to a special edition of You Legal TV.

Have you ever found yourself in the throes of an impossible challenge and wondered how you could ever overcome it? The beauty of it is: we all have. Despite the huge diversity of human life, we have in common our ability to pick ourselves up after a low point. Even when we think we've reached our limit. Even when life seems to be too difficult, too overwhelming. That's gumption. We all have it, and sometimes we forget.

New book, 'Gumption Trigger' provides stories of innovators, entrepreneurs, and disruptors who emerged from hard times even stronger and more determined, reading it we are reminded of where we can find our gumption again.


What Should I Do Next?

Contact us if you would like to buy the book Gumption Trigger or Visit Here for online purchase.

* This blog is for general guidance only. Legal advice should be sought before taking action in relation to any specific issues.

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