Crowdfunding Laws Bring an Exciting Change

Last year, the Federal Government announced it would introduce new laws to enable “Mum and Dad investors” to invest directly in start-up companies. Some of the changes to existing laws include: a 5 day cooling off period; an increase in the allowable cap on funds to be raised; a higher level of money to be held, up to $5 million. The Corporations Amendment (Crowd-sourced Funding) Bill 2015 aims at allowing small companies to attract investment in their business by the public injecting equity via “crowdfunding” as an on-line method. This is a revelation in the prior laws and runs against the regulations and political background which have resisted this method of capital raising. The key amendments are to the Corporations Act 2001 and will provide for a large number of shareholders to apply for shares in return for share capital in the start-up companies. Despite this forward thinking development in the law there are some sections of the business community that have expressed frustration with the proposed laws on the basis they do not go far enough and impose too many restrictions. The experience in other countries, such as Israel, point to alternative methods which are faster and less regulated in the process of raising essential capital for these new companies. As a form of consumer protection, the Australian legislation now requires that investors must go through appropriately licenced crowdfunding procedures. These procedures require a high level of due diligence on the proposal, to avoid likely misleading or deceptive conduct by company promoters. The public as investors are “consumers” under the Act and are strongly encouraged to seek their...
Nothing is more certain than death and taxes

Nothing is more certain than death and taxes

  A very Happy New Year to everyone and I hope 2016 is amazing for you and your family. I start this year wrestling with the issue of taxation on deceased estates. It is very often overlooked by the key beneficiaries of an estate as they are always keen to get their hands on the cash. The problem is, before the Executor can make a payment, they must assess exactly what tax is payable, otherwise they will find themselves personally liable for the assessment by the ATO and no funds with which to pay the bill. With rising balances held in self managed super funds it is more than likely that there will be a death benefit payable from that as the source of funds. Before making payments the trustee must calculate the tax payable to the person based on their status as a “tax dependant” or not. A spouse will be able to receive a super fund payment without tax but a non-dependant adult child may not, subject to age, living at home status and study. It is very important a Will maker take into account the different tax consequences for different individuals when making an allocation between family members in terms of the overall estate assets, including family trusts and super. This gets even trickier when you have second or third marriage status and children of prior relationships. How do you ensure they get their share but allow the source of income to continue for the spouse? Control of a self managed super fund is critical and often the surviving spouse will want to maintain the assets...
Illegal Movie Downloads – Is it you?

Illegal Movie Downloads – Is it you?

All of us at some point know someone that has told us about illegally downloading a movie via an internet site. It seems unfair for those of us who pay full price through iTunes but most of us just figure that the younger generation are smarter than us. A new Federal Court case sheds some light on the rights of the movie makers as owners of the copyright and those pesky downloaders. What happens when they get caught and how do they get caught? It seems from the evidence in the Dallas Buyers Club Movie (DBC) and a group of Internet Service Providers (ISP), including IINet, Internode and Dodo, that the fight continues. On 14 August the Federal Court gave an indication of the compensation copyright owners can expect to claim in future copyright breach matters and how the illegal downloaders might expect to receive a bill. What happened here was a digital investigator found 4,726 IP Addresses from which the DBC movie was illegally downloaded and shared on “Bit Torrent”. The owner sought a Court Order requiring the relevant ISP to provide details of the owners of the IP Addresses. To get an Order like this they had to demonstrate a right to obtain relief against potential Defendants, namely the ISP account holders. The judge ordered the ISP to provide this information but DBC had to provide the letter of demand to the account holders. The concern here was an unreasonable demand for the level of damages suffered from the copyright infringement. In terms of the amount of money the owner of the copyright intended to claim, the...

Is my email a binding Contract?

It is a surprise to many of our clients that the exchange of emails can constitute a binding Contract. The courts are frequently holding people to these Contracts and it is a topic that requires some careful consideration in times where email is the dominant method of communication. Stodgy old paper Agreements with a lengthy witnessing clause might get left on the desk when parties are talking. However, if there is sufficient dialogue and certainty of terms by email, that may be enough to create a legally binding agreement. When parties are negotiating it is a real danger time and there are some rules that should be followed during those exchanges. Although the Courts are often perceived as being backwards in regards to technology, they have in fact responded to this shift in communication by accepting email as a means of creating binding agreements. Not all business managers have caught up with this trend and are regularly placing their company at risk.  It is a mistake to believe that what is said or agreed over email is not binding, and that a legally binding contract is only made when a formal written document is signed. Take a look at some recent cases with us and let us know if you have a similar issue in your business. EMAIL NEGOTIATIONS – BINDING OR NOT? If you have started to negotiate by email but don’t want your emails to be a binding contract, then you must clearly state in your emails that “no binding agreement is formed unless and until a formal contract has been executed”. If you don’t expressly state...

Professional Partners – Strategic Wealth

Over the last 10 years we have worked closely with Nick Moustacas of Strategic Wealth based in Sydney to assist clients with business development, planning exit strategies and achieving that through the transaction process. He has a great knack of talking to clients in a way that is easy to understand and makes it possible for them to make decisions. Business owners and investors in property can get great benefit from his skills. We love working with Nick and his team and can recommend his excellent technical knowledge as well as the higher level strategic consulting. http://www.strategicwealth.com.au   ...

Facebook Introduces Legacy Contacts

Facebook is now allowing users in the United States to designate a “legacy contact” that can take control of an account after their death. The new features allows a trusted family member or friend to:- write a post to display at the top of the memorialised Timeline (for example, to announce a memorial service or share a special message); respond to new friend requests from family members and friends who were not yet connected on Facebook; and update the profile picture and cover photo. If given permission under the new feature, the legacy contact may also download an archive of the photos, posts and profile information from the deceased’s Facebook. Other settings will remain the same as before the account was memorialised, including that the legacy contact will not be able to log in as the deceased or see the deceased’s private messages. See all details at the following...