Elevate Legal – Back for 2021!
After the year that was 2020 we all enjoyed a break over the Christmas and New Year period. We hope you all got a break too. The classics were enjoyed including the beach, watching too much cricket, marathon Monopoly games, reading, good food and good wine! We have now returned to the office (yes, actually returned to the physical office!) feeling rejuvenated and ready to tackle 2021.
Our Alliance Service detailed in our last newsletter is up and running, with our first Alliance members coming on board in December. This service provides essential legal support for growing technology companies and access to member-only benefits, all for a fixed monthly fee. There are different tiers to suit your company’s needs and size. If you’d like more information or to talk to us about signing up, please email email@example.com.
We look forward to working with all our clients and supporters in an awesome 2021.
Andrew, Jackie, Roxie & Yee
Each newsletter we profile one of our clients doing amazing things.
In this edition, we’re proud to feature Scalene Group.
Scalene Group is a specialist retail analytics company. The business is led by individuals with both retail experience and data scientists. These combined skills including strategy, store development, management consulting, analytics and software development enables retailers to use analytics for profit growth. Scalene works with businesses and locations world-wide, including department stores, beauty and health retailers and accessories and fashion retailers. During the Covid-19 Pandemic they were able to assist an iconic UK food retailer to adapt its macro space to the changes in shopping patterns.
Elevate Legal began working with founder Mick Moore in 2018, with a particular focus on commercial contracts with large retailers. In 2020 Scalene Group became a foundation member of our Alliance service. We look forward to continuing to support the team as their business grows.
What else is keeping us busy
Here’s some other projects we’ve worked on with our clients over the last few months.
- Advising a Sydney based software firm on the sale of a minority stake to financial and strategic investors
- Helping several clients with capital raising – term sheets, SAFE notes and issues of ordinary and preference shares
- Software / SaaS contract terms
- Reseller and distribution agreements, teaming agreements
- Intellectual property licences, assignments and other transactions
- Preparing, reviewing and advising on lots of commercial contracts
- Reviewing Privacy Policies and Website T&Cs
If you’re looking for similar solutions please get in touch.
Payment Times Reporting Act 2020
If, like many of our clients, you are a small business who sells to large Government and corporate customers, you may be interested to know what their record is like on paying their small business suppliers. A new Commonwealth law will make it easier for you to find out…
The Payment Times Reporting regime commenced on 1 January 2021. This imposes new obligations on large businesses to report on their payment terms and practices relating to small business suppliers. The regime does not provide a time period within which small businesses must be paid, instead it provides a framework for greater transparency over the payment practices of large businesses. (Presumably hoping to shame the worst payers; or, at the very least, to keep them honest when they say to you ‘no we can’t negotiate, we pay all our suppliers on 90 day terms’!)
A reporting entity is a ‘constitutionally covered’ entity that carries on an enterprise in Australia with an annual total income of more than $100 million (and each of its subsidiaries with a total income of more than $10 million). Registered charities and not-for-profits are excluded under the Act. ‘Constitutionally covered’ entities covers a large majority of government-owned corporations and private sector businesses.
The regime requires reporting entities to report on the following twice per year:
- standard payment periods at the beginning of the reporting period – including the shortest and longest standard payment periods. This will include reporting any changes over the 6-month reporting period;
- the proportion of small business invoices that were paid within 20 days, between 21 and 30 days, between 31-60 days, between 61-90 days, between 90-120 days and more than 120 days, post the invoice being issued;
- the proportion of procurement that was from small business suppliers; and
- any other information prescribed by the Payment Times Reporting Rules. These Rules are currently in draft form but are expected to prescribe the requirements for reporting on supply chain financing arrangements.
Reports must be provided to the new Payment Times Reporting Regulator within 3 months of the end of each 6-month reporting period. Reporting entities will also be required to keep records of their reporting compliance for 7 years. The reports will be disclosed on a publicly available register.
The Regulator will have wide-ranging powers to investigate and monitor all compliance with the Act and to compel a reporting entity to undertake a compliance audit. The Regulator will also have the power to impose infringement notices for civil penalty provisions and publish details of non-compliant entities.
More information at https://www.industry.gov.au/regulations-and-standards/payment-times-reporting-scheme
Major FIRB Reforms begin January 2021
In the July 2020 edition of our newsletter (here) we detailed the changes proposed by the Federal Government to the foreign investment review (FIRB) regime. These changes have now been finalised and came into effect on 1 January 2021.
Below is a summary of the some of the major changes:
- The monetary thresholds will be re-instated for ‘notifiable actions’ and ‘significant actions’ (in March 2020 the threshold was reduced to $0.00 due to the Covid-19 Pandemic). The $0.00 threshold will remain for a new category of ‘notifiable national security actions’.
- The following will constitute the new category of ‘notifiable national security actions’:
- to start a national security business;
- to acquire a ‘direct interest’ (usually 10% or more) of a national security business, or in an entity that carries on a national security business; and
- to acquire an interest in national security land.
- The Treasurer will be given a ‘last resort power’ to make divestment orders and unilaterally impose a new condition or vary conditions after FIRB approval has been granted.
- The Treasurer will be given a new ‘call in power’ to review an action which:
- is taken or proposed to be taken on or after 1 January 2021;
- was not previously notified to FIRB;
- is a ‘significant action’ or a ‘reviewable national security action’; and
- may pose a national security concern.
- Passive increases (increase in a foreign person’s percentage interest in an entity which does does not result from a person acquiring an interest in securities, for example non-participation in a capital reduction or buy-back) in certain circumstances can constitute a notifiable action or notifiable significant action and require a notification to FIRB.
- The Treasurer will have the power to unilaterally extend a decision period by up to 90 days – this will apply to FIRB applications submitted on or after 1 January 2021.
- Penalties for non-compliance will be significantly increased.
- The infringement notice regime will be expanded to cover all types of foreign investment, not just residential real estate.
Consumer Law Changes
$100,000 threshold, from July 2021
Currently under the Australian Consumer Law, a person / entity is considered a ‘consumer’ if the goods or service they are purchasing are not more than $40,000 (or are ordinarily purchased for personal or household use). On 1 July 2021 this threshold will increase to $100,000. So products/services which are not intended for personal or household use, and are worth up to $100,000, will be covered by the consumer laws.
This means the consumer guarantees under the Australian Consumer Law will apply to more goods and services. These guarantees cannot be excluded from a contract (and any term that tries to, is void). It also means that some specific wording around warranties (particularly for defects) may be required to be included in contracts. The Australian Consumer Law also includes remedies for breaches of consumer guarantees which would be available to a consumer against a supplier or service provider.
An overview of the consumer guarantees under the Australian Consumer Law can be found on the ACCC website here. An overview of the warranty wording under the Australian Consumer Law can be found on the ACCC website here.
Reading & Eating
During lockdown there was a fair bit of down time (especially here in Victoria!). I spent a fair bit of time cooking and baking and came across this delicious, and more importantly easy, Alison Roman recipe in the New York Times. This caramelised shallot pasta has a bit of everything – spice, saltiness and sweetness – and the recipe makes a double batch which is excellent for the times you don’t feel like cooking. I highly recommend giving this pasta a go! Recipe can be found here. (Roxie)
And a selection of my summer reading (Andrew):
- A Promised Land, Barack Obama – a no-brainer for a liberal political junkie like me. Detailed, long (this only covers his first term in office), a bit worthy and earnest, but thoughtful, articulate and humane…what a stark contrast to his successor…
- Flash Boys, Michael Lewis – a few years old now (2014) but still (another) shocking indictment of stock exchanges and financial markets in general.
- Honeybee, Craig Silvey – this summer’s ubiquitous bestseller. Enjoyable and cinematic. File with Boy Swallows Universe, and look out for the movie adaptation.