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

  • Focus: New APRA prudential standard raises bar for information security obligations and incident notification requirements

    15 November 2018

    As companies and regulators across the world grapple with ever-increasing cyber security threats, Australia's financial services regulator, APRA, has released the final form of a new prudential standard. It will require APRA-regulated entities to establish and maintain information security controls to protect customer data, and to notify APRA of information security incidents that have, or may have, a material effect on customers' interests. This will have significant implications both for regulated entities and for their boards of directors. Partners Gavin Smith and Simun Soljo and Lawyer James Higgins report.

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  • Unravelled: AFCA's powers and obligations - 'systemic issues'

    13 November 2018

    In his Interim Report, Commissioner Hayne rejected claims that misconduct in the financial services sector was the fault of 'a few bad apples' and did not raise 'broader or systemic concerns'. Commissioner Hayne's comments made me think about AFCA and what it can do (and must do) about 'systemic issues' identified in the course of handling complaints.

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  • Unravelled: The ins and out (goings) of responsible lending

    13 November 2018

    Very broadly speaking, current legislation relating to responsible lending says that a person must not recommend or make an 'unsuitable' loan to a consumer – an unsuitable loan being one that either does not meet the consumer's requirements and objectives, or imposes repayment obligations that they are unable to meet without substantial hardship.

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  • Unravelled: Efficiently, honestly and fairly - overarching and fundamental obligations?

    11 October 2018

    In his recent Interim Report into Misconduct in the Banking, Superannuation and Financial Services Industry, Commissioner Hayne makes a lot of the duties of an Australian financial services licensee and an Australian credit licensee to provide financial services or credit activities, as the case may be, efficiently, honestly and fairly.

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  • Unravelled: Royal Commission: Round 1 - experiences with consumer lending practices

    2 October 2018

    In examining the topic of consumer lending, the Commission considered issues arising from the sale of credit products – including residential mortgages, car finance and credit cards - by reference to case studies involving the four major banks as well as Aussie Home Loans and Citi.

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  • Unravelled: Royal Commission: Round 2 - experiences with financial advice

    2 October 2018

    Although the Commissioner says that the Royal Commission is part of the executive and not the judiciary and that he is therefore not able to make any findings of law, he comes pretty close in his views in response to Round 2. And in some important respects, those views do not correspond with conventional views.

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  • Unravelled: Royal Commission: Round 3 – experiences with SME lending

    2 October 2018

    The third round of the Royal Commission's hearings concerned lending practices to small and medium enterprises (SMEs). The hearings considered a range of case studies.

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  • Unravelled: Royal Commission: Round 4 – experiences with financial service entities in regional and remote communities

    2 October 2018

    In the Interim Report, the Commissioner identifies four principal issues relating to agricultural lending.

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  • Client Update: Treasury proposes tougher penalties for corporate and financial sector misconduct

    26 September 2018

    The Federal Government has released exposure draft legislation for public consultation that, if enacted, will implement many of the recommendations of the ASIC Enforcement Review Taskforce to strengthen the penalty regime for corporate and financial sector misconduct. Partner Simun Soljo and Lawyer Roseanna Bricknell take a look at the proposed laws.

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  • Unravelled: Close and continuous monitoring - the new ASIC approach of embedding its officers in banks

    19 September 2018

    ASIC has recently announced a new supervisory approach that involves embedding ASIC officers in the four major banks and AMP. The initial media reporting on this approach suggested that it would involve embedding 'teams of up to 20 agents for weeks at a time to sit with bank staff, drop into meetings and trail the CEO, executives and directors to identify misconduct before it arises.'

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  • Focus: How ipso facto provisions (and exemptions) affect project finance - both good and bad news

    5 September 2018

    The new ipso facto regime applies to contracts entered into on or after 1 July 2018. It imposes a stay on the exercise of certain contractual rights in some insolvency regimes (administration and some receiverships and schemes of arrangement, but not liquidation). There are many exemptions from the regime, some of which will be relevant to project finance. Partner Scott McCoy, Senior Finance Counsel Diccon Loxton and Senior Associate Isabel Cropley discuss some of the issues.

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  • Client Update: Full Federal Court speaks on competing class actions

    30 August 2018

    In the latest instalment in the attempts to deal with competing shareholder class actions, the Full Federal Court has ordered the transfer of four shareholder class actions against AMP to the Supreme Court of New South Wales, where a fifth class action is already pending. In doing so, the court gave the clearest indication yet that multiple class actions raising similar issues should not be permitted to proceed. It also acknowledged in more express terms than ever before that competing class actions are really all about the competing interests of class action promoters and not group members. Partner Jenny Campbell and Linklaters Associate Gert-Jan Hendrix report.

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  • Unravelled: Competing class actions - a problem in need of a solution

    20 August 2018

    As fertile ground for class actions, the Royal Commission has highlighted an ongoing problem with Australia's class action regime – there is no clear, consistent means for resolving competing class actions.

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  • Unravelled: Update on the Royal Commission

    19 July 2018

    Have you been wondering what the Royal Commission will make of the numerous witness statements and vast amounts of other information collected from superannuation trustees in recent times? You will find out soon enough. But first, there are some curiosities from the Round Four hearings to consider – including a hint as to what the superannuation hearings will include.

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  • Focus: VLRC takes first cut at class action reform

    22 June 2018

    The Victorian Law Reform Commission has completed its review of Victoria's class action regime, with a particular focus on the effect of litigation funding. The report calls for national regulation of litigation funding, lifting the ban on contingency fees both generally and in class actions (balanced with appropriate regulatory measures) and a greater supervisory role for the Victorian Supreme Court in the management of class actions. Managing Associate Kate Austin, Associate Kelly Roberts and Lawyer Katerina Dandanis discuss.

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  • Unravelled: Update on the Royal Commission

    22 June 2018

    A lot has happened since our most recent update. The Royal Commission has published the submissions received from ASIC and industry participants on policy questions posed by Counsel Assisting at the end of the financial advice hearings. And the small business lending hearings have been held.

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  • Allens insights: International Comparative Legal Guide to Project Finance 2018 - Australia

    25 May 2018

    Partners Ben Farnsworth and Michael Ryan outline the main trends and significant developments in Australian project finance. Among other factors, they discuss restrictions on foreign investment, bankruptcy and restructuring proceedings, tax, and political risk in relation to changes in law.

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  • Unravelled: Breach reporting by AFS licensees

    15 May 2018

    In the hurly burly of the Royal Commission’s recent hearings concerning financial advice, you may have missed some very important information about breach reporting by AFS licensees contained in the witness statement prepared by Mr Peter Kell, Deputy Chair of ASIC.

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  • Unravelled: Royal Commission update

    15 May 2018

    The hearings in the Financial Services Royal Commission have been compulsory viewing, not only for financial services industry participants and their regulators and professional service providers. The hearings have exposed wide-ranging actual or alleged wrongful conduct that has captured the attention of politicians, media and the general public.

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  • Unravelled: Draft code of ethics for financial advisers - in need of much more work

    9 April 2018

    You would be hard pressed to find a bigger load of nonsense than the draft code of ethics for financial advisers issued recently by the Financial Adviser Standards and Ethics Authority.

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  • Unravelled: The Royal Commission heats up

    9 April 2018

    The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry is well underway, with its first round of public hearings wrapping up less than a month ago. By reference to a number of case studies, the first round of hearings focused on consumer lending practices. In this article, we report on the key themes identified by the Commission as arising from the hearings.

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  • Focus: Trustee insolvency - the Full Federal Court weighs in to the debate

    29 March 2018

    We recently examined the implications of a Victorian Court of Appeal decision on trustee insolvency in the Amerind Appeal1. As we foreshadowed, the Full Federal Court has just released its decision on similar issues.2 It came to a similar position to the Victorian court in deciding that trust assets should be applied first in paying employees and other statutory preferred creditors (though for varied reasons). But it came to the opposite position in holding that trust assets could only go to trust creditors, not non-trust creditors. That finding will cheer lenders and others dealing with trusts, but leaves a confused landscape. Partner Philip Blaxill, Senior Finance Counsel Diccon Loxton and Associate Lucas Tan report.

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  • Unravelled: Preparing a target market determination for a financial product

    21 March 2018

    As the 'design and distribution' obligations for issuers and distributors of financial products inch closer, there is a good deal of hand-wringing taking place. Much of it concerns what a target market determination should look like. Guidance from the European Securities and Markets Authority on MiFID II provides a sense of what local issuers may be in for. But first - Treasury's proposal.

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  • Unravelled: Personal advice and the best interests duty

    21 March 2018

    There has been a great deal of attention given to the meanings of 'financial product advice' and 'personal advice' in the Corporations Act and many of us are eagerly waiting to see what Justice Gleeson will say about the topic in the case ASIC has brought against the BT trustees. However, whatever Her Honour decides in that case, it is unlikely to help very much, because the line between general advice and personal advice will always turn on the facts and, where the facts change with each interaction with a customer or client, it will continue to be difficult for licensees to be confident that they and their representatives are not giving personal advice. While that is a pity, it is, in my view, a greater pity that more licensees are not prepared to take the plunge and give personal advice. If licensees assumed that their interactions with customers and clients about financial products was personal advice, the difference between general advice and personal advice would not matter much.

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  • Focus: Statutory priority of secured creditors and trustee insolvency: implications of Re Amerind appeal decision

    13 March 2018

    The recent unanimous Victorian Court of Appeal decision1 in an appeal from Re Amerind has been widely welcomed by insolvency practitioners and others, as it brought some clarity to the question of whether the statutory order of priority applies to trust creditors. However, not all aspects of the decision will be as widely welcomed. In particular, in favouring a previous controversial decision of the court suggesting that trust assets should be applied in paying non-trust creditors, the Court of Appeal has resurrected a longstanding debate. Trust creditors and beneficiaries will be concerned if it is followed. Further, though insolvency practitioners and statutory preferred creditors will be generally pleased by the court's adoption of a wide interpretation of what is a 'circulating security interest' for the purpose of determining statutory priorities, it will concern secured creditors. Partner Philip Blaxill, Senior Finance Counsel Diccon Loxton and Associate Lucas Tan reflect on the decision and its ramifications.

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  • Allens insights: Australia - Fund Finance 2018, 2nd Edition

    27 February 2018

    Fund financing activities in Australia remained strong in 2017, with particular focus on infrastructure, private equity funds and private debt funds, which have taken advantage of the additional liquidity and funding flexibility in this market. Allens Partner Tom Highnam, Managing Associate Rita Pang and Senior Associate Victoria Johns provide an overview of the funds landscape in Australia, key developments and the outlook for the next 12 months.

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  • Focus: Move to require big banks' participation in comprehensive credit reporting

    23 February 2018

    The Federal Government has introduced draft legislation to establish a long-awaited mandatory comprehensive credit reporting regime for the major banks from 1 July 2018. Partner Gavin Smith, Senior Associate Emily Cravigan and Lawyer Dougald Coulson report.

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  • Client Update: ACCC's Enforcement and Compliance priorities for 2018

    22 February 2018

    A number of industries and issues are in the spotlight following release of the ACCC's 2018 Enforcement and Compliance Priorities by ACCC Chairman Rod Sims on 20 February 2018. The financial services, energy, commercial construction and agriculture sectors will be a focus in 2018, as well as the post-Harper misuse of market power and concerted practices provisions, digital platforms and large franchisors.

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  • Unravelled: Productivity Commission releases draft report on competition in the financial system

    20 February 2018

    The Productivity Commission's draft report on competition in the financial system, released earlier in February, makes 25 draft recommendations, a key focus of which are reforms to the regulatory system. We take you through the key issues and recommendations.

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  • Focus: Federal Government review into Open Banking

    14 February 2018

    The Federal Government has released its much anticipated Review into Open Banking in Australia. The Review makes 50 sweeping recommendations to implement Open Banking, including a new regulatory framework under which the regime would operate in the broader context of a new Consumer Data Right for all sectors. Partner Gavin Smith, Senior Associate Elyse Adams, Associate Leah Wickman and Lawyer Connie Ye report on some of the key elements of the report.

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  • Unravelled: A Commission of Inquiry - of the Royal, not the Parliamentary, kind

    19 December 2017

    Since the announcement of the Royal Commission into, ahem, financial services, much has been written and said – a lot of which suggests that little attention is being paid to the terms of reference. In this article I take a look at those terms.

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  • Client Update: Infrastructure investment in Australia - the road ahead for institutional investors

    11 December 2017

    With large-scale privatisations slowing and intense competition for assets that do come to market, institutional investors are looking to non-traditional assets to provide similar long-term, stable and predictable returns.

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  • Focus: Unitranche financing in the Australian market

    4 December 2017

    As regulatory and political pressure increases on the major banks in Australia, alternative credit providers are entering the market with a variety of products to attract borrowers. The unitranche loan is an example of one such product. Partner Warwick Newell, Senior Overseas Practitioner Alex Tonkin and Associate Hamish McCormack examine what makes unitranche loans unique – and what role they could play in the increasingly competitive Australian acquisition financing market.

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  • Unravelled: The BEAR has dropped, where to from here?

    9 November 2017

    The commencement date of the BEAR legislation is fast approaching and institutions should start planning how to comply with the regime. We look at the changes made to the BEAR legislation following industry submissions, the timing for implementation and key steps to take.

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  • Allens insights: Multisource financing: making multiple options work

    19 October 2017

    In an environment where Australian issuers, especially from the infrastructure sector, are actively seeking diversified funding options, two Allens Partners – James Darcy and Scott McCoy – discuss the key structuring considerations for issuers and sponsors wishing to establish debt platforms to access longer-term financing options.

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  • Unravelled: FX global code update

    4 October 2017

    The FX Global Code was launched in Australia earlier this year and applies to 'market participants', including most financial institutions, bank asset managers, brokers and E-trading platforms. The Code sets out 55 best practice principles and, although compliance is voluntary, it is expected that these principles will become the standard for the FX market industry.

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  • Unravelled: Spring overhaul of Australia's market licensing regime

    4 October 2017

    Australia's market licensing regime has long been crying out for an overhaul, with regulatory guidance that largely dates back to the early 2000s struggling in the face of significant developments in financial markets since then. Fortunately, ASIC has taken heed and is due to release an updated market licensing regulatory guide this month. If the draft guidance is anything to go by, we should soon see a much more modern and flexible approach to market licensing.

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  • Client Update: Blockchain reaction update - ASIC joins chorus on ICO regulation

    3 October 2017

    While ASIC has published information on the issue of coins or tokens in initial coin offerings, other regulators around the world have also been issuing guidance, with some taking a much more restrictive approach. Although Australia remains a relatively friendly regulatory environment for such offerings, there are a number of potential regulatory traps, both here and overseas, that issuers should carefully consider before launch. Managing Associate Simun Soljo, Senior Associate David Rountree and Lawyer Chris Walsh report.

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  • Client Update: The BEAR roars into action

    26 September 2017

    The Federal Government has released the exposure draft of the Treasury Laws Amendment (Banking Executive Accountability and Related Measures) Bill, together with a draft Explanatory Memoradum. This follows on from the release of the Banking Executive Accountability Regime (BEAR) consultation paper in July which raised eyebrows with its short three-week consultation period. The exposure draft only provides five working days for interested parties to lodge a submission. This is a clear indication of the Government's desire to implement BEAR swiftly. Partner Michelle Levy and Senior Associates Sarah Burgemeister and Brenton Pollard report.

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  • Unravelled: APRA's new powers in superannuation - A worthy idea, but checks and balances required

    12 September 2017

    APRA is in line to get significantly increased powers of direction in respect of RSE licensees and their 'controlled entities' as part of the package of superannuation reforms announced in the Treasury Legislation Amendment (Improving Accountability and Member Outcomes in Superannuation) Bill 2017.

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  • Client Update: Vietnam opens its debt trading market to foreign investors

    1 September 2017

    Recent years have seen players in the Vietnamese banking sector making extensive efforts to recover non-performing loans (or bad debts). The Government has issued new regulations to improve the processes for recovering and handling bad debt in Vietnam and has implemented a framework to facilitate the trading of bad debt in a secondary market. Partner Linh Bui and Associate Dang Vu report on the key issues.

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  • Focus: New PPP guidelines for NSW

    28 July 2017

    The NSW Government has released updated guidelines that govern the Public Private Partnership procurement process in NSW and will provide welcome assistance to both NSW Government agencies and bidding consortiums. Partner Nicholas Adkins and Associate Sunny Jong report.

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  • Unravelled: UK's Financial Conduct Authority report into asset management: guidance for future direction

    6 July 2017

    ASIC often looks to overseas regulators for inspiration. So when a particularly influential regulator publishes a comprehensive report about a large segment of its regulated population, including possible new areas for regulation, it can pay to take note because it may be a guide to the future direction of Australian regulation.

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  • Unravelled: Raising capital, raising standards: managing conflicts of interest in sell-side research and corporate advisory

    6 July 2017

    ASIC continues its mission to enhance the regulation of Australia's equity markets, with its recent publication of Consultation Paper 290 on managing conflicts of interest when dealing with sell-side research and corporate advisory. The proposed amendments will primarily target investment banks and corporate advisers in the IPO and capital raising process.

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  • Client Update: ASIC sell-side research consultation and proposed regulatory guidance

    4 July 2017

    ASIC's new regulatory guidance focuses on managing conflicts of interest and material, non-public information when providing sell-side research. As well as providing extensive guidance on managing conflicts of interest during the capital raising process, ASIC provides its views on payment of discretionary fees, and the funding and structure of the research arm of banks, as well as foreshadowing a further view on allocation policies. Partner Julian Donnan and Senior Associate Addison Ma report.

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  • Client Update: Amendments to PPS lease law - what you need to know

    22 May 2017

    Legislation has come into force that will amend the Personal Property Securities regime. The amendments are designed to reduce the PPSA's impact on the equipment hiring industry. Previously hirers' equipment leases and bailment arrangements of an indefinite term, or short term leases of a year or more were deemed to be PPS leases, and security interests. If they were not perfected by registration, the owner of the equipment could lose priority, and could lose the equipment altogether if the lessee or bailee became insolvent. Many hirers were caught inadvertently. Now, those arrangements will only be caught if they are initially for two years or more, or the lessee or bailee ends up holding the equipment for two years or more. Partners Nicholas Creed and Ben Farnsworth explain.

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  • Client Update: Environmental bond and mine rehabilitation reform in Queensland

    15 May 2017

    Major reforms to environmental bonds and rehabilitation requirements are proposed in two discussion papers released by the Queensland Government. All mining sector operators should understand how the reforms will impact their current and proposed operations. Partner Bill McCredie and Senior Associate Gobind Kalsi report.

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  • Client Update: Ipso facto clauses, safe harbour for directors - our comments on the draft exposure legislation

    10 April 2017

    The Federal Government has released draft exposure legislation designed to facilitate company reconstructions. Senior Finance Counsel Diccon Loxton, Senior Associate Alicia Salvo and Associate Frances Navarro-Towan discuss some of the implications and issues. 

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  • Unravelled: ASIC's report on financial advice

    7 April 2017

    ASIC has recently released a report about its work with the big four banks and AMP on adviser misconduct. The report is essentially an update on the progress of ASIC's Wealth Management Project, and mostly contains information we already know. The most interesting part deals with the results of ASIC's review of adviser audit processes by the banks and AMP. They indicate that internal audits are not identifying compliance issues.

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  • Unravelled: A step closer to industry funding of ASIC

    7 April 2017

    Last week, the Federal Government moved another step closer to implementing an industry funding model for the recovery of ASIC's costs, by introducing the ASIC Supervisory Cost Recovery Levy Bill 2017 (as well as two related Bills) into Parliament. These Bills implement the recommendations of the Financial Services Inquiry and the Senate Economics Committee that ASIC be industry funded, and follows a number of rounds of industry consultation on exposure drafts and proposal papers.

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