Richard Colbeck (Tasmania, Liberal Party, Parliamentary Secretary to the Minister for Finance and Administration) Share this | Hansard source

The government’s perspective in relation to this is that the Takeovers Panel was established to take takeover cases away from the courts. Indeed, there need to be broad powers for experts to decide commercial issues based on broad principles and on what they consider unacceptable. In fact the PJC agreed that the panel should have broad based powers to act without constant concerns about jurisdictional challenges, and I note that Senator Murray commented on that in his contribution. The very aim of the legislation that we have before us is to give the panel a wide power to act so that it can make commercial decisions which give effect to the spirit and the purposes of the act.

The formulation in the bill that the panel can do certain things, having regard to the purpose of the takeovers law, gives a broad jurisdiction to the panel. The proposed opposition amendment narrows that formulation, because the circumstances would need to be inconsistent with or contrary to the takeovers law. This is a narrow jurisdiction. It would lead to, in the government’s view, constant uncertainty, as it invites parties to argue that the panel has not demonstrated something as definitively contrary to or inconsistent with the purposes of the law. For example, you could say circumstances were contrary to only one of the four purposes set down in the takeovers law and therefore not contrary to the purposes overall. Persons might therefore see it as worth their while to challenge whether the panel has satisfied the negative test in order to slow down a bid for months until the court gives its decision.

A plethora of tactical litigation is exactly what was happening before the panel was constituted in 2000 and is what the government is seeking to guard against as part of this legislation. In light of the constant threat of challenge to the panel’s powers that would exist under the opposition’s proposed amendment, the panel would become very reluctant in the government’s view to intervene in all but the clearest cases, leaving the market with no option but to go to court on any takeovers matter.

Question negatived.