This is the last issue of 2015. Read the latest legal commentary by experienced practitioners and industry leaders. Here's my General Editor's note that gives a flavour of what's covered. Happy reading!

Read the latest legal commentary by experienced practitioners and industry leaders. Here's my General Editor's note that gives a flavour of what's covered. There are seven articles in this issue! And the content is diverse yet relevant. Enjoy! 

Read the latest legal commentary by experienced practitioners and industry leaders. Here's my General Editor's note that gives a flavour of what's covered.

Happy reading!

A number of new legislation will take effect in 2015.  To begin our new year, from 1 January 2015, the current Franchising Code of Conduct will be repealed, and a new Franchising Code of Conduct will replace it.  The new Code is the outcome of an extensive review, and the Franchise Council of Australia (FCA) has worked collaboratively with both the previous and current Governments during the lengthy consultation process.  The FCA has welcomed the upcoming release of the new Code, stating that it was pleased to see that much of the contribution made by its members had been taken into account.

The ACCC continues to be the regulator responsible for this mandatory industry code that applies to the parties to a franchise agreement.  According to the ACCC, the new Franchising Code of Conduct will:

• introduce an obligation under the Code for parties to act in good faith in their dealings with one another;
• introduce financial penalties and infringement notices for serious breaches of the Code;
• require franchisors to provide prospective franchisees with a short information sheet outlining the risks and rewards of franchising;
• require franchisors to provide greater transparency in the use of and accounting for money used for marketing and advertising and to set up a separate marketing fund for marketing and advertising fees;
• require additional disclosure about the ability of the franchisor and a franchisee to sell online; and
• prohibit franchisors from imposing significant capital expenditure except in limited circumstances.

The ACCC’s website provides some very useful information for franchisors and franchisees alike, including access to the updated Franchisor Compliance Manual and the Franchisee Manual.  These ACCC manuals are compulsory reading for parties to any franchise agreement as they cover, among other things, the rights, responsibilities and obligations of the parties, and how to resolve disputes under the Code.

We can help you understand, apply and implement new legislation in 2015 and beyond - just contact us for assistance.

Thank you to our legal experts for another informative issue of the Australian Banking and Finance Law Bulletin. Read my General Editor's note to find out what we have lined up for our readers in another excellent ensemble of comprehensive commentary on the hot topics and latest developments in banking and finance law and practice. It is hard to believe that this, the November edition, is our second-last issue for 2014. Stay put for our December edition. It will be a compelling read!

The latest issue of LexisNexis' Australian Banking and Finance Law Bulletin has just been released. We have another amazing line up of experienced practitioners covering recent case law as well as current hot topics. Read my General Editor's note to get a taste of what's covered.

What is Ripple?  Have you heard of Ethereum?  What about Auroracoin?

The answer – these are cryptocurrencies. 

The Oxford Dictionary defines “cryptocurrency” as “a digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank”.  Perhaps the most famous cryptocurrency is the first cryptocurrency - created only 5 years ago - Bitcoin.

There are many definitions of Bitcoin, but basically, Bitcoin is a payment system.  Other cryptocurrencies that have the same characteristics as Bitcoin are payment systems as well.  On 20 August 2014, the Australian Taxation Office (ATO) released guidance on the tax treatment of cryptocurrencies in Australia, specifically regarding Bitcoin.  You can read the ATO’s guidance here.

According to the ATO, transacting with Bitcoin is akin to a barter arrangement, with similar tax consequences.  The ATO specified that its view is that Bitcoin is neither money nor a foreign currency, and the supply of Bitcoin is not a financial supply for GST purposes, but Bitcoin is treated as an asset for capital gains tax purposes.

In the 21st century, we can use Bitcoin (or Ripple, Ethereum, Auroracoin plus many more other cryptocurrencies) to pay for personal or business transactions.  Do you know Bitcoin can even be used to paying salary or wages?  What you also may not know is that the ATO has a number of other resources relevant to the tax treatment of cryptocurrencies in Australia.  These include Taxation Ruling No. IT 2668 on barter transactions, and Draft GST Determination GSTR 2014/D3 on the GST implications of transactions involving Bitcoin.  You can access these resources here.

Cryptocurrencies are gaining traction not only globally but also locally, with an estimate of 50,000 users in Australia, as reported by the ABC on 22 August 2014.  You can read the report here.  This interesting piece of news item also reported that, while ATMs that accept and exchange Bitcoin already exist, a first-of-its-kind-in-Australia ATM has just opened in Canberra.  This new ATM trades three major cryptocurrencies - Bitcoin, Dogecoin and Litecoin. 

It is indeed time for all of us to learn more about cryptocurrencies.

This post first appeared on CPD Interactive's "Legal Natter's Blog".

The latest issue of LexisNexis' Australian Banking and Finance Law Bulletin has just been released. We have an amazing line up of authors contributing 7 quality articles. Read my General Editor's note to get a taste of what's covered.

On 31 July 2014, ASIC released Report 402 that outlines enforcement outcomes it has achieved during the period 1 January 2014 to 30 June 2014.  As Australia’s corporate, markets and financial services regulator, ASIC has the role of identifying and dealing with those who break the law.  ASIC does this through their detect-understand-respond approach:

• Detect misconduct or the risk of misconduct by gathering intelligence
• Understand by analysing the intelligence
• Respond to misconduct or the risk of misconduct using regulatory tools such as enforcement action

In the first half of the 2014 calendar year, ASIC reported that it has achieved 256 enforcement outcomes, with 83 enforcement outcomes in the “market integrity”, “corporate governance” and “financial services” areas, and 173 in the “small business compliance and deterrence” area.  In particular, ASIC has focused on the activities of credit providers.  This is because ASIC considers that the consumer credit industry has now had sufficient time to familiarise itself with its obligations under the National Consumer Credit Protection Act 2009 (Cth).  As such, if ASIC becomes aware of breaches of the law, it is now more likely to take enforcement action to address its concerns.  During the 6-month period covered by the report, ASIC has achieved a significant number of outcomes relating to consumer credit, including two criminal convictions, five infringement notices paid (totalling $71,400), six individuals permanently banned from engaging in credit activities, four individuals banned from, or giving an undertaking to refrain from, providing credit for between three and seven years, and seven Australian Credit Licences cancelled.

While ASIC will continue to take enforcement action in any area that it administers, ASIC has identified a number of enforcement areas it will be focusing on.  These are:

• Treatment of confidential information
• Auditor and liquidator standards
• Advertising of financial products
• Benchmarks (relating to, for example, LIBOR and BBSW)

You can access ASIC’s full report (Report 402) via ASIC’s website.

This post first appeared on CPD Interactive's "Legal Natter's Blog".

The Personal Property Securities Amendment (Motor Vehicles) Regulation 2014 (Cth) was registered on 1 April 2014.  It will commence in 3 months on 1 July 2014.  The new Regulation narrows the definition of motor vehicle for the purposes of the Personal Property Securities Act 2009 (Cth) (PPS Act). 

The new Regulation has a grand total of only 4 pages, which includes the cover page and the contents page.  The operative provisions consist of merely a few lines on the last page, which repeals paragraph 1.7(2)(b) of the current Regulation and substitutes the existing wording with this wording “(b) is capable of a speed of at least 10 km/h; and (ba) has one or more motors that have a total power greater than 200W” (emphasis added).

So what does this mean?  The current definition of motor vehicle provides that a motor vehicle is personal property built to be propelled wholly on land, by a motor that forms part of the property, and that either is capable of a speed of at least 10km/h, or has one or more motors that have a total power greater than 200W.  The amended definition will provide that personal property must have both of these characteristics to qualify as a motor vehicle.

And what impact will this have?  The Explanatory Statement (ES) to the new Regulation explains the impact in one succinct statement – “The narrowing of the definition reduces the number of goods that will be motor vehicles, which in turn will reduce the number of security interests which may require the making of separate registrations against the serial number of the goods involved rather than only a registration against the party granting the security interest.”

The ES also explains that the objective here is to “reduce the costs of complying with the PPS Act for small and medium equipment hire businesses whilst still maintaining the utility of the Register as a record of interests in personal property for third parties”.

Both the Regulation and the ES can be accessed here.

It is fair to say this is probably the first of a series of changes about to take place.  The PPS Act is now over 2 years old.  Last week, on 4 April 2014, the Commonwealth Attorney-General, Senator the Hon George Brandis QC, said it is timely to review the PPS Act’s effect to ensure it is meeting its objective of providing greater certainty to lenders and helping business, especially small business, to access finance.  The Government is undertaking a review into the PPS Act, and an interim report is due on 31 July 2014.  The interim report will focus on issues raised in relation to small businesses.  The final report is due on 30 January 2015.  Time will tell whether and how the review and the recommendations that follow will change Australia’s personal property securities regime.

This post first appeared on CPD Interactive's "Legal Natter's Blog".