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Electronic execution now permanent for Australian companies

Changes to the Corporations Act for COVID-19 that allowed virtual company meetings and electronic execution of company documents have been made permanent. These changes mean that companies no longer have to fear a return to doing everything in hard copy and in person. 
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How to protect yourself against Construction Company insolvencies.

Entering into a contract to build a new home for a fixed price would seem, at least on the surface, to be the easiest and most stress-free way to get yourself a brand-new home...  
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Set-off shield to unfair preference claims dropped

Last Thursday (16 December 2021), in the decision of Morton as Liquidator of MJ Woodman Electrical Contractors Pty Ltd v Metal Manufacturers Pty Limited [2021] FCAFC 228 (MJ Woodman), the Full Court of the Federal Court delivered a highly anticipated decision surrounding section 553C of the Corporations Act 2001 (Cth) (Act) and a liquidator’s unfair preference claim.
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Did you really pay? Who is liable for payment in an invoice redirection scam?

According to the ACCC, Australian businesses lost over $132 million to business email compromise scams in 2019. One example is the invoice redirection scam, which can involve a fraudster hacking into the system of the supplier or intercepting emails and sending altered invoices to customers with different banking details. Payments made to these accounts are likely never recoverable. With work becoming increasingly digital, it is imperative for businesses to protect themselves and their customers from such scams.
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Raising the bar for raising funds – improvements to charitable fundraising rules boast tighter enforcement

From 1 July 2021, new rules apply to charities and appeals. Although there may be less red tape, the most significant changes relate to enforcement.  
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No more peak indebtedness in unfair preferences - 3 things you should know

The Full Court of the Federal Court of Australia in Badenoch Integrated Logging Pty Ltd v Bryant, in the matter of Gunns Limited (in liq) (receivers and managers appointed)[2021] FCAFC 64 (Badenoch No. 1) has decided that the peak indebtedness rule, often relied upon by liquidators in calculating the quantum of unfair preference claims in situations where there was a continuing trading relationship between the company in liquidation and the creditor under section 588FA(3) of the Corporations Act 2001 (Cth) (the Act), does not apply.
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Exposing breaches of privacy – mandatory notification of data breach scheme approaching for NSW

For over two years, the NSW Government has considered whether a mandatory reporting scheme for data breaches should be adopted under the State’s privacy framework.
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ASIC extends relief on virtual meetings

The recent lockdown in Brisbane is a timely reminder that a return to ‘business as usual’ is still uncertain.  This article explores the Australian Securities and Investments Commission (ASIC)’s ‘no action’ position, which is intended to facilitate businesses to hold their meetings effectively despite restrictions on gatherings and travel.
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A Backward Stride for COVID-19 bankruptcy measures

As the extension of the temporary relief and protection provided by the Corporations and Bankruptcy Legislation Amendment (Extending Temporary Relief for Financially Distressed Businesses and Individuals) Regulations 2020 during the outbreak of COVID-19 came to an end on 31 December 2020, as of 1 January 2021:
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Corporate Insolvency Reforms. New Year, New Scheme - What you need to know.

As the temporary relief and protection for businesses impacted by COVID-19 comes to an end on 31 December 2020, insolvency experts brace for a potential floodgate of insolvency administrations. Parliament clarifies the new provisions under the Corporations Amendment (Corporate Insolvency Reforms) Bill 2020 (Cth) (Bill) which will commence on 1 January 2021.
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5 things you should know: Insolvency Reforms for Small Business

On 24 September 2020, the Australian Government announced its proposed major reforms to insolvency laws to support small business recovery and to streamline the insolvency process. The reforms are expected to commence on 1 January 2021, subject to the passing of legislation. The reforms will adopt features from Chapter 11 of the United States Bankruptcy Code, being a “debtor in possession” corporate insolvency model.
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Rethinking unfair preferences through echoes of the past

Before being placed into voluntary administration, Eliana Construction and Developing Group Pty Ltd (Company) and Mad Brothers Earthmoving Pty Ltd (Mad Brothers) executed a settlement agreement in which the Company agreed to pay Mad Brothers $220,000 for a debt the Company owed Mad Brothers. A payment of $220,000 (Payment) was made to Mad Brothers by Rock Investments Pty Ltd (Rock) from a loan facility Rock had with Nationwide Credit Pty Ltd.  
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Signed, attached and emailed: The court’s take on electronic signatures and recent temporary COVID-19 amendments to the Corporations Act regarding electronic execution

As part of the response to the COVID crisis, temporary measures have been introduced to facilitate the electronic execution of documents. In this blog we consider whether those measures would have changed the decision in the Bendigo Case and the extent to which they are likely to remain temporary.  
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Demise of the Phoenix – new identification requirements for directors

In recent years, the Commonwealth Government has made efforts to deter and penalise phoenix activity in order to protect those who are negatively affected.  One of those efforts is the DIN requirement for directors, which is poised to disrupt phoenixing and deliver additional benefits.
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Amendment to the Corporations Act - technology use

The law now allows technology use for company meetings and execution of documents. This change was made in response to the social distancing and health requirements amid the Covid-19 pandemic.

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