House of Representatives

Explanatory Memorandum

(Circulated by the authority of the Treasurer, the Hon J. B. Hockey MP)

General outline and financial impact

Corporations Legislation Amendment (Deregulatory and Other Measures Bill) 2014

The Corporations Legislation Amendment (Deregulatory and Other Measures) Bill 2014 (Bill) amends the Corporations Act 2001 (Corporations Act) and the Australian Securities and Investments Commission Act 2001 (ASIC Act) to remove unnecessary regulation, clarify existing regulatory obligations, and enhance the efficient operation of certain Government bodies.

The key measures will:

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better balance the rights of shareholders to raise issues with a company and the costs to companies of being required to call and hold a general meeting;

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improve and reduce remuneration reporting requirements;

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clarify the circumstances in which a financial year may be less than 12 months;

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exempt certain companies limited by guarantee from the need to appoint or retain an auditor;

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improve the operation of the Takeovers Panel by allowing takeover matters to be dealt with more efficiently; and

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extend the Remuneration Tribunal's remuneration setting responsibility to include certain Corporations Act bodies.

Date of effect: The amendments commence on the day this Bill receives Royal Assent.

Proposal announced: The Minister for Finance and Acting Assistant Treasurer proposed this Bill in Media Release titled 'Consultation open on amendments to the Corporations Law' of 10 April 2014.

Financial impact: The amendments in the Bill do not have a budgetary impact.

Human rights implications: This Bill does not raise any human rights issue. See Statement of Compatibility with Human Rights - Chapter 7, paragraphs 7.3 to 7.4.

Compliance cost impact: The amendments in the Bill are expected to lead to a net reduction in compliance costs borne by business.