Allens

Banking & Finance

Our experienced Banking & Finance legal team regularly publishes articles and updates - the full list of publications appears below. These publications contain the latest news and developments, and look at the ramifications for your business. If you'd like to be notified when we add new banking & finance publications to the site, please go to our subscription page to sign up for email alerts or, alternatively, you can subscribe to our RSS feed.

See also our banking & finance pages for more information on our broad range of skills and experience in the financial sector, including capital raisings, securities, superannuation and managed investments.

Banking & Finance Publications

  • Unravelled: The High Court has its say on penalties

    9 August 2016

    In case you haven't heard, last week the High Court handed down its decision in Paciocco v Australia and New Zealand Banking Group Limited. In what was perhaps the most highly anticipated High Court decision of the year, the majority found that credit card late payment fees charged by ANZ were not penalties. Here we look at what the High Court had to say about the penalties rule and what this means for business and for class actions in the financial services space.

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  • Unravelled: Post-election policy recap

    9 August 2016

    As the dust settles following the recent federal election, it is a good time to reflect on what we can expect from the re-elected Coalition Government for the financial services sector. There are two main groups of policy proposals that are going to need to get through Parliament. The first is the fairly significant superannuation changes announced in the 2016/17 Budget in May. The second is the series of changes the Government announced in its response to the Financial System Inquiry. This brief article provides a refresher on each of them.

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  • Unravelled: Brexit and financial services regulation

    6 July 2016

    The idea that the UK could, on leaving the EU, simply walk away from a significant amount of EU financial services regulation seems fantastical. It is likely that the UK will, instead, have to adopt (on exit) vast amounts of EU financial services regulation. However, the UK will have no say on the future direction of EU financial services regulation - and it will also have to manage the inevitable future divergence between that regulation and its own domestic law.

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  • Unravelled: Welcome changes to the derivative charging rules for superannuation trustees

    6 July 2016

    The Government has recently made changes to superannuation law that helps clear the way for trustees of regulated superannuation funds to charge fund assets in order to enter into a broad range of exchange-traded and Over-The-Counter derivative transactions. The changes are intended to make it easier for super fund trustees to manage risk in the post-GFC environment.

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  • Unravelled: Blockchain and why smart contracts still need smart lawyers

    6 July 2016

    There has been so much talk about blockchain and distributed ledger technology recently, especially in financial services, that you might be forgiven for thinking it might be more hype than substance. But we think it could be very important technology.

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  • Allens insights: Value capture and getting smart

    30 June 2016

    The Australian Government has identified value capture and innovative financing as key elements of its Smart Cities Plan. The move will have significant implications for traditional project finance. By Paul Kenny, Sector Leader, Government, and Phillip Cornwell, Project Finance, Consultant at Allens.

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  • Paper: How the UK's Brexit decision could affect you

    20 June 2016

    This week the UK will vote on whether it wants to remain part of the EU. This decision could have global economic impacts and affect your business. For instance, how will it impact on free trade agreements with Europe and the rest of the world, the pace of deals in the UK, and the UK regulatory environment? To learn more, see an EU referendum overview put together by our alliance partner, Linklaters.

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  • Special Report: Understanding the opportunities and navigating the legal frameworks of distributed ledger technology and blockchain

    17 June 2016

    Authored by a multidisciplinary team from Allens, Blockchain Reaction is designed to assist business stakeholders, decision makers and in-house counsel across a variety of sectors to understand the technology and how it is being used, as well as navigate the regulatory and legal opportunities and challenges.

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  • Allens insights: Green Renaissance in Australia

    8 June 2016

    After more than three years of inertia, the Australian renewable energy industry is finally showing signs of a resurgence. A series of reviews of the Renewable Energy Target since 2012, and the abolition of the carbon tax in 2014, created a climate of uncertainty that meant investment in new large-scale renewable generation slowed dramatically.

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  • Allens insights: Getting The Deal Through: Market Intelligence - Project Finance

    3 June 2016

    Allens Partners Phillip Cornwell, Michael Ryan and Ben Farnsworth were part of the global panel analysing the project finance market, including key economies, regional analysis and PPPs. In Getting the Deal Through's second annual issue focusing on the global project finance markets, Phillip, Michael and Ben analysed the evolving legal and regulatory landscape in Australia.

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  • Unravelled: A reprieve for ASIC and APRA ... but not for the FCA

    2 June 2016

    ASIC and APRA often cop flak from various quarters (including from us) and so today, for something different, we train our sights on the Financial Conduct Authority in the UK. What the FCA has said about providing personal advice to retail clients is interesting, debatable and likely to induce a strong sense of déjà vu.

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  • Unravelled: The end of the AML/CTF regime as we know it?

    2 June 2016

    The past year or so has been an action-packed one for devotees of anti-money laundering policy and the recent release of the Report on the Statutory Review of the AML/CTF Act 2006 may herald the most significant changes to our regime since it was introduced a decade ago.

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  • Unravelled: Coming this spring: ACCC to monitor large merchants' payment surcharges

    2 June 2016

    The Reserve Bank has now released a Standard which sets out what payment surcharges will be permitted for the purposes of the new Part IVC of the Competition and Consumer Act 2010 (Cth). The aim of the Standard is to improve competition and efficiency by providing to consumers price signals associated with the actual cost of using certain payment methods, with the ACCC given the power to monitor and enforce compliance with new laws.

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  • Paper: The Public-Private Partnership Law Review

    18 May 2016

    Partners David Donnelly and Nicholas Ng examine public-private partnerships (PPPs) in Australia, including the year in review, the general framework, bidding and award procedures, recent decisions and the outlook for 2015.

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  • Client Update: Personal Property Security regime commences in PNG

    10 May 2016

    The commencement of the Personal Property Security regime means important changes to the way companies transact business in Papua New Guinea. Partner Karla Fraser and Senior Associate Sarah Kuman report.

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  • Unravelled: New ASIC funding - looking beyond the headlines

    4 May 2016

    Along with the public release of the ASIC Capability Review Report, the Government announced a suite of reforms giving ASIC additional (but targeted) funding and has also sought to remove some of the shackles on hiring it believes may be hindering ASIC's ability to recruit top talent. At the same time, the Government confirmed that a 'user pays' model will be introduced for ASIC's funding needs from the second half of 2017 onwards.

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  • Unravelled: ASIC getting a bigger toolkit sooner than expected

    4 May 2016

    In its response to the capability review into ASIC, the Federal Government has made a commitment to accelerate the implementation of a product intervention power for ASIC and the product design and distribution obligations for the financial services industry, but it left to one side some other important issues raised by the review. We consider what this might mean for both the regulator and the regulated.

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  • Unravelled: 'Tough cop' ASIC vs a Royal Commission

    4 May 2016

    Has talk of a royal commission turned the ASIC Capability Review into an unlikely catalyst for an enhanced enforcement agenda? With Labor pushing hard for a royal commission into the banking and financial services industry and an election looming, the Government moved swiftly to announce broad reform measures to equip ASIC with stronger powers and funding, as well as a new Commissioner with a financial crime prosecution background, to ensure that, in ASIC, Australia has a 'tough cop on the beat'.

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  • Unravelled: A long time coming: The Retirement Income Streams Review Report

    4 May 2016

    Going into the 2013 election, the present Government promised a review of the regulatory framework for retirement income streams. Today, the Government finally released its report. It has been a long time coming. And while the main outcome – a new category of tax effective pensions and annuities – will be welcomed by many, there are unanswered questions and implementation may take a while.

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  • Unravelled: Bitter Harvest yields fertile ground for MIS reform

    5 April 2016

    Last month, the Senate Economics References Committee handed down its long-awaited report on the structure and development of agribusiness-managed investment schemes. The Committee's inquiry into agribusiness schemes had been instigated in June 2014 by Greens Senator Peter Whish-Wilson. While there had been an earlier Parliamentary Joint Committee inquiry, in 2009, into the high-profile agribusiness MIS collapses, the 2014 inquiry was intended to give the people and the rural communities affected by the MIS collapses a chance to be heard.

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  • Unravelled: Providing digital financial product advice to retail clients

    5 April 2016

    ASIC is consulting on a new regulatory guide for providers of digital financial product advice, or 'robo-advice'. The regulatory guide is intended to help new entrants and existing Australian financial services licence holders. For new entrants and licensees needing a reminder, there is a nice summary of the differences between information (that they are keen on calling 'factual information') and financial product advice, and between personal advice and general advice. ASIC points out that the law is the same whether or not advice is provided in person or by means of a computer program.

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  • Client Update: Government and ASIC announcements for FinTech sector

    23 March 2016

    There were three announcements this week that will serve to bolster the emerging Australian FinTech sector. The Government released a statement in support of FinTech as part of its National Innovation and Science Agenda, while ASIC issued two sets of guidance: an information sheet for providers of marketplace lending products, and draft guidance to providers of digital financial product advice. Partner Gavin Smith, Managing Associate Valeska Bloch, Senior Associate Simun Soljo and Senior Paralegal Connie Ye report.

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  • Client Update: Defining the objective of superannuation

    9 March 2016

    The Government released a discussion paper on the Objective of Superannuation today. The paper says that the Government will 'enshrine in legislation' the primary objective recommended by the Financial System Inquiry being: 'To provide income in retirement to substitute or supplement the Age Pension.' Partner Michelle Levy, Senior Regulatory Counsel Michael Mathieson and Senior Associate Georgia Cleeve look at the discussion paper.

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  • Unravelled: Dodd Frank - promoting financial stability and other purposes

    7 March 2016

    The Dodd Frank Act is a bit like the US financial system it is trying to regulate – vast, complex and hard to wade through. It creates a bunch of new regulators on top of what was already a pretty solid cast and gives them wide-ranging powers. They can not only set capital and liquidity requirements for banks and make rules about what they can and cannot do, but they can also shut down or sell off parts of their businesses. But are these regulators smart enough or well enough resourced to identify the risks?

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  • Unravelled: Would you like best interests with that? Conflicted remuneration, American style

    7 March 2016

    Last month, we were fortunate enough to host Barney Frank, co-architect of the Dodd-Frank Wall Street Reform and Consumer Protection Act 2010, to discuss financial regulation reform. Coincidentally, a couple of weeks later, we were treated to a presentation on US financial regulation reforms by a US lawyer, David W. Powell, at the annual superannuation lawyers' conference. Powell's presentation focussed on US efforts to expand 'fiduciary' duties for financial advisers, including those advising on Individual Retirement Accounts. IRAs now constitute a large chunk of US retirement savings. There are some interesting comparisons to be made between the proposed US rules and existing Australian financial advice laws. But perhaps most interesting of all is the proposed 'best interest contract exemption'.

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  • Unravelled: Transparency and Accountability - and not just for Wall Street

    7 March 2016

    The regulatory law repercussions of the GFC remain endlessly fascinating. As an example, take the Dodd-Frank Wall Street Reform and Consumer Protection Act 2010. It runs to 848 pages. Title VII addresses, perhaps optimistically, 'Wall Street Transparency and Accountability'. My favourite provision is section 716, headed 'Prohibition Against Federal Government Bailouts of Swaps Entities'. This heading suggests that, if there is ever another AIG, it can't be bailed out. Too-big-to-fail solved by legislative prohibition. If only it was that easy.

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  • Focus: You've got to be perfected - Equipment leasing and the PPSA

    7 March 2016

    A recent decision of the Supreme Court of New South Wales has again illustrated the potentially severe consequences for lessors of equipment and other goods under the 'vesting' provisions of the Personal Property Securities Act 2009 (Cth). The lease can be a security interest. If the lessors don't perfect the lease by registration, they can lose the equipment. Partner Kim Reid, Senior Associate Przemek Kucharski and Lawyer Kane Kersaitis report.

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  • Focus: Australia has lifted certain sanctions on Iran

    18 February 2016

    In response to recent confirmation that Iran has met its international nuclear commitments, the Australian Government has lifted all nuclear-related economic and financial sanctions against that country. Partner Rachel Nicolson, Managing Associate Hilary Birks and Associate Sarah Jenkins report on what has changed and the potential opportunities for Australian businesses.

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  • Unravelled: Crowd-sourced equity funding

    5 February 2016

    The Government has finally begun the process of implementing its policy on crowd-sourced equity funding (CSEF) by introducing a Bill and releasing draft exposure regulations late last year, which envisage the establishment of a CSEF regime in Australia. The Bill has been referred to the Senate Economics Legislation Committee who are expected to report later this month.

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  • Unravelled: Raising professional standards of financial advisers

    5 February 2016

    Following on from the reviews conducted by the Parliamentary Joint Committee and the Financial System Inquiry, the Government delivered on its promises by releasing an exposure draft of the Corporations Amendment (Professional Standards of Financial Advisers) Bill 2015 (the Bill) late last year for consultation. As its title suggests, the draft Bill proposes a number of amendments to the Corporations Act to raise the professional standards of financial advisers that are to apply from 1 July 2017. Many of these reforms impose obligations that licensees in the retail financial advice and superannuation trustees should carefully consider and begin making provision for.

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  • Client Update: Guarantors owed a duty of care under the Code of Banking Practice

    21 January 2016

    A recent decision of the Victorian Court of Appeal has given a wide meaning to the Code of Banking Practice, finding that the duty of care owed by a lender in assessing the borrowers' ability to repay, extends to guarantors. Effectively the bank was responsible to guarantor/directors for funding their own bad business decision. Partner Karla Fraser, Senior Finance Counsel Diccon Loxton and Research Assistant Harry Stratton report.

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  • Client Update: New measures on resilience, collateral protection and client money

    22 December 2015

    The Government yesterday released for consultation draft legislation containing 'resilience and collateral protection' measures. Think payment systems, netting and derivatives. But also think superannuation trustees and life companies investing in centrally-cleared OTC derivatives – and restrictions on charging assets. The Government also released a policy paper on how to make the client money provisions more protective. Partners Tom Highnam and Michelle Levy and Senior Regulatory Counsel Michael Mathieson look at some of main points of the new draft legislation.

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  • Unravelled: Product rationalisation - again

    8 December 2015

    The FSI report recommended that the Government facilitate rationalisation of legacy products in the life insurance and managed investment scheme industries. The need for ways to close legacy products has been kicking around for at least a decade and, in 2007, Treasury released a very thorough options paper covering product rationalisation in the managed funds sector. Treasury said that sector was represented by life insurance, managed investment schemes and superannuation.

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  • Unravelled: Government launches innovation agenda - now wait for the ideas boom

    8 December 2015

    You might be getting tired of all of the talk about 'innovation', and keen to see some of it actually happen. The Government's recent announcements could help, but there is a long way to go before the 'mining boom' becomes the 'ideas boom'.

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  • Unravelled: FSI outcomes - what will happen and when?

    8 December 2015

    Are you interested in the financial system and how it is regulated? The Federal Government's response to the Financial System Inquiry was recently handed down but it can be hard to work out where, exactly, things are heading. We have put together a table that sets out what is likely to happen and when.

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  • Client Update: Major overhaul of Australia's foreign investment laws: what's new?

    4 December 2015

    The new package of legislation overhauling Australia's foreign investment laws, the first major revision in 40 years, commenced on 1 December 2015. While many features of the previous regime have been retained (and sometimes re-named), there are also a number of significant changes. Partners Jeremy Low, Wendy Rae and Richard Kriedemann and Senior Associate Eve Regnard review the key new elements.

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  • Focus: UK Supreme Court counters High Court on penalties

    19 November 2015

    The highest appellate court in the UK has affirmed and restated the penalty rule as it applies in the UK in a recent decision that directly addresses, and counters, the High Court of Australia's approach to the rule in Andrews. Partner Nick Rudge and Lawyer Patrick Easton report.

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  • Focus: PNG securities laws rewrite

    9 November 2015

    Those dealing in PNG's capital markets should be aware that the PNG Parliament recently passed a package of legislation to substantially amend and strengthen the regulation of its capital markets. The regime will introduce new licensing requirements for those involved in activities such as securities dealing, funds management, and corporate advice. The role of the PNG Securities Commission will be strengthened and expanded, and the rules relating to offers of securities will be updated. Partner Richard Kriedemann looks at the new regime.

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  • Unravelled: What does the Government's response to the FSI mean for banks?

    6 November 2015

    The short answer is: it depends on which kind of bank you are. The Financial System Inquiry's final report and the Government's response mean a lot for ANZ, CBA, NAB and Westpac, particularly given their significant residential mortgage portfolios. They also mean a lot for Macquarie. As for the rest of the banks, they are likely to see the ramifications for the major banks as their own gain.

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  • Unravelled: Superannuation and the Government's response to the FSI

    6 November 2015

    The Government's response to the FSI's superannuation recommendations is, as with much of the rest of the responses, somewhat safe (and, as a result, arguably disappointing). As with the Inquiry's recommendations, it shifts from the sublime to the ridiculous – on the one hand it deals with the really central question of what our superannuation system is for, to the other of extending choice of fund to the small number of employees who are currently excluded because they are covered by State awards and enterprise agreements. In between, it is going to ask the industry to sort out retirement incomes (with some legislative loosening) and the Productivity Commission to sort out costs and competition.

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  • Unravelled: Government says 'Yes ASIC'

    6 November 2015

    The FSI recommended that the Government 'Introduce an industry funding model for Australian Securities and Investment Commission (ASIC) and provide ASIC with stronger regulatory tools'. This recommendation (No.29) covers two topics that ASIC has pursued on a number of occasions, including in its submissions to the FSI. The first is ASIC's preference to move to an industry funding model; and the second is ASIC's recommendation that penalties under ASIC-administered legislation be increased.

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  • Report: Green Bonds: emergence of the Australian and Asian markets

    23 October 2015

    The global market for Green Bonds continues to grow steadily, driven by strong investor demand and the continual need for capital to finance 'green' projects.

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  • Focus: Painting the full picture: certifiers and financiers in projects

    20 October 2015

    A recent decision of the UK High Court provides valuable instructions to both financiers and consultants regarding their obligations in monitoring project developments. Partners Nick Rudge (view CV) and David Donnelly (view CV) and Lawyer Patrick Easton report on the decision in Lloyds Bank plc v McBains Cooper Consulting and its relevance to parties to Australian projects.

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  • Unravelled: Proposed industry funding model for ASIC

    6 October 2015

    Treasury has released a Consultation Paper seeking comments on a proposed industry funding model for ASIC. Under the proposed model, the costs of ASIC's regulatory activities will be recovered directly from the companies and other entities that are regulated by ASIC – at a direct cost to industry of approximately $260 million. This amount will be collected through a combination of annual supervisory levies (around $196 million) and significant fee increases for fee-for-services activities to reflect ASIC's actual costs of providing specific on-demand services to individual entities. In this article, we look at the proposed model in more detail.

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  • Unravelled: Corporate culture and conduct risk

    6 October 2015

    Regulators, particularly in the UK and Australia, are increasingly interested in corporate culture in the financial services industry, its impact on the integrity of the system, and what the regulators are doing to try to entrench a corporate culture that works for the benefit of consumers and investors. In this article, we look at various aspects of the relationship between corporate culture and conduct risk – convincing Australian financial services organisations that by focusing less on profit, and more on investors' long-term interests and market integrity, they really are helping themselves.

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  • Client Update: PPS deregulation measures to take effect

    29 September 2015

    From 1 October 2015, short-term leases of serial numbered goods will no longer be deemed security interests under the PPSA. Businesses should review their current PPS policies and, where appropriate, implement changes to processes, as Partner Karla Fraser and Lawyer Katharine Ward explain.

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  • Unravelled: ASIC - A crackdown on corporate culture

    4 September 2015

    Corporate culture, and its role in shaping conduct within the financial services sector, is now clearly at the forefront of ASIC's enforcement agenda. This focus was apparent in ASIC's 2014-2015 strategic outlook, released in October 2014, which identified corporate culture as a key risk driver and poor culture within the financial services sector as a root cause of conduct that threatens the integrity of the financial services industry.

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  • Unravelled: The UK's focus on personal accountability for bank employees: a sign of things to come?

    4 September 2015

    Last month we discussed the 'carrot' in the UK Parliamentary Commission on Banking Standards – how the regulators are making sure remuneration for bank staff encourages prudent risk behaviour. This month we are looking at the 'stick' – how the UK is strengthening regulators' enforcement armoury to enable them to more easily take action against individuals who do not meet the conduct standards expected of them.

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  • Unravelled: Regulating bonuses: will Australia be next?

    5 August 2015

    The UK's Financial Conduct Authority and Prudential Regulation Authority released rules, in June this year, to further tighten what are already fairly onerous restrictions on the payment of bonuses to staff in banks, building societies and certain big investment firms. The world's financial regulators have, for some time, been trying to crack down on what they consider to be inappropriate remuneration structures and it begs the question – will Australia be next?

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  • Focus: Agency arrangements alright - ANZ and Flight Centre succeed in appeals

    31 July 2015

    The Full Federal Court today handed down its decisions in two high-profile appeals in relation to ANZ and Flight Centre. Both cases dealt with the issue of distribution arrangements and price fixing. Partner Carolyn Oddie and Associate Theodore Souris look at the implications for business.

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