AUSTRALIAN CORPORATIONS LAW ARTICLE 2022

Running head: CORPORATIONS LAW
CORPORATIONS LAW
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CORPORATIONS LAW1
Part A:
The Australian Corporate law has its origin in the UK company law. It has its legal form
under one national statute called the Corporations Act 2001 (Cth) which is controlled and
regulated by a national regulating body called the Australian Securities and Investments
Commission hereinafter referred to as ASIC. As the provisions enumerated in this statute can be
very often traced back to few pioneer United Kingdom legislation, reference can be easily made
to the judgments made by the UK courts. Although other types are permissible, the private as
well as the public companies form the main corporate structures in Australia, where both have
limited liability predominantly.
Limited powers were granted on Federation in 1901 by the Constitution of Australia to
the Parliament of Australia in respect of the corporations. A residual power is possessed by each
of the States in relation everything which is not within the Commonwealth authority and power.
Though in Australia the Corporations law had historically adopted and followed the
developments of English law very closely, the main responsibility was entrusted to each of the
separate legislature of State and thus significant differences were observed in corporation related
legislation among various states.
After Second World War, it was observed very clearly that the legislative differences that
existed among the States were incurring unnecessary expenses for those companies that had their
operations in more than one state. The Commonwealth and the states cooperated each other for
the creation of a uniform national code of the companies that was legislated in every jurisdiction
by the year 1962. However there lies a difficulty in it. It had not provided consistency in the new
amended legislation. Further with changes of policy and government legislation of every state

CORPORATIONS LAW2
was developed on different lines once again. This attempt of a complex arrangement of vesting
by the territories, states as well as commonwealth was declared not valid by concerned High
Court. In the famous Concrete Pipes Case, formally known as the Strickland v Rocla Concrete
Pipes Ltd [1971] HCA 40, (1971) 124 CLR 468 (3 September 1971), High Court, it was decided
that laws having proper connection with the constitutional corporations’ trading activities were
valid.
In 1978 a second type of cooperative scheme was agreed and it was implemented by the
year 1982 for overcoming the defects that were present in the 1st scheme. All the laws as well as
their amendments would have to be consented by the Ministerial Council and have to be applied
automatically in each of the jurisdictions. This 2nd scheme created the National Companies and
Securities Commission hereinafter referred to as NCSC which is the forerunner of the Australian
Securities and Investment Commission.
Although a development was made on the initial scheme, the second scheme of 1982 still
showed various difficulties because of the delegating administrative function of the NCSC to the
state commissions. In the case of New South Wales v Commonwealth [1990] HCA 2, (1990)
169 CLR 482 (8 February 1990), High Court, popularly known as the Incorporations case, 1990
it was decided that the power of the Commonwealth companies is limited to the making of laws
only in relation to companies that had begun trading, not to companies' formation .
Then the Commonwealth tried to assume the main responsibility of the corporations law.
In the year 2001, present arrangement was formed when the states refer to their power to the
Commonwealth in relation to the corporations.