2019-2020-2021

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

HOUSE OF REPRESENTATIVES

SUPPLEMENTARY EXPLANATORY MEMORANDUM

Amendments to be moved on behalf of the Government

(Circulated by authority of the

Treasurer, the Hon Josh Frydenberg MP)

Glossary............................................................................................................. 1

General outline and financial impact............................................................. 3

Chapter 1 ........... Meetings and Documents - Parliamentary Amendments   5

Chapter 2 ........... Statement of Compatibility with Human Rights.............. 9

The following abbreviations and acronyms are used throughout this explanatory memorandum.

Corporations Amendment (Meetings and Documents) Bill 2021 - Parliamentary Amendments

The Parliamentary Amendments to the Bill provide that:

•                paragraph 249R(c) and 252P(c) in the Bill (which permit wholly virtual meetings) cease to have effect if a report on the review of the operation of these provisions is not tabled in each House of Parliament within 30 months of the commencement of Schedule 1 to the Bill;

•                the review of those provisions must be conducted by an independent panel with experience:

-               in corporate governance and the role of company directors;

-               representing the interests of shareholders; and

-               advocating for corporate social responsibility; and

•                the Government must also prepare a response to the report and table it within 3 months of the report first being tabled in Parliament.

Date of effect :  The later of the day after the Bill receives Royal Assent and 1 April 2022.

Proposal announced :  These amendments have not previously been announced.

Financial impact :  Nil

Human rights implications :  Human rights implications: The amendments do not affect the analysis of the human rights issues provided for in the Explanatory Memorandum to the Bill. See Statement of Compatibility with Human Rights — Chapter 2, paragraphs 2.1 to 2.5.

Compliance cost impact :  Nil

Outline of chapter

1.1                    The amendments that facilitate wholly virtual meetings cease to have effect if a report on the review of the operation of those provisions is not tabled in parliament within 30 months of the commencement of Schedule 1 to the Bill.

1.2                    The amendments also ensure that the panel undertaking the review is independent and has the necessary experience to take into account the interests of companies, registered schemes and their members.

1.3                    The Government must also prepare and table a response to the report within 3 months of the report first being tabled in either House of Parliament.

Comparison of key features of new law and current law

Detailed explanation of new law

1.4                    The amendments provide that sections 249R(c) and 252P(c) of the Corporations Act 2001 , which allow for meetings to be held using only virtual meeting technology, cease to have effect if a report (or reports) on the operation of those provisions is not tabled in parliament before the end of a period of 30 months beginning on the day that Schedule 1 to the Bill commences. This is six months after the review must be completed under section 1687J of the Bill. [Amendments 1 and 4, note to section 1687J(2) and section 1687K]

1.5                    If the provisions cease to have effect, any meetings held prior to the end of that period will be valid, but wholly virtual meetings cannot continue to be held. [Amendments 1 and 4, note to section 1687J(2) and section 1687K]

1.6                    If the report makes recommendations, the Government must prepare a response to these recommendations and table it in each House of Parliament no later than the first sitting of that house after a period of 3 months beginning on the day that the report is first tabled in either House of Parliament. [Amendment 3, section 1687J(6)]

1.7                    The amendments also require the review of the operation of sections 249R(c) and 252P(c) to be conducted by an independent panel, with at least one member with experience in relation to corporate governance and the role of company directors, experience advocating for corporate social responsibility and experience representing the interests of shareholders. This aims to ensure that the review takes into account the views of companies, registered schemes, and their members. [Amendment 2, section 1687J(2A)]

Consequential amendments

1.8                    There are no consequential amendments.

Application and transitional provisions

1.9                    Schedule 2 to the Bill as amended will commence on the later of:

•        the day after the Bill receives Royal Assent; and

•        1 April 2022.

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Corporations Amendment (Meetings and Documents) Bill 2021

2.1                    These amendments are compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 .

Overview

2.2                    The amendments to Schedule 2 to the Bill provide that the provisions that facilitate wholly virtual meetings cease to have effect if a report on the review on those provisions is not tabled in Parliament within 30 months of the commencement of Schedule 1 to the Bill.

2.3                    The amendments also ensure that the panel undertaking the review is independent and has the necessary experience to take into account the interests of companies, registered schemes and their members.

2.4                    Finally, the amendments require the Government to prepare and table a response to the review in a timely fashion.

Human rights implications

2.5                    These amendments do not engage any of the applicable rights or freedoms.

Conclusion

2.6                    These amendments are compatible with human rights as it does not raise any human rights issues.