Legal Scholarship Network

18 February 2011

Sydney Law School's latest legal studies research paper series is now available on theLegal Scholarship Network:

Takeovers, Poison Pills and Protectionism in Comparative Corporate Governance-Professor Jennifer Hill

The regulation of hostile takeovers constitutes an interesting corporate governance microcosm. It is an area where clear contrasts in approach, regarding the balance of power between shareholders and the board of directors, are evident across different jurisdictions. Takeovers also reflect the dynamic operation of legal regulation (which includes the strategic responses of regulated parties themselves), and the growing tension between globalization and protectionism.

This paper analyses the regulation of hostile takeovers across a number of Western and Asian jurisdictions. First, the paper discusses the rise of takeovers and takeover defences in the United States. Against this backdrop, it examines recent developments in some other common law jurisdictions, such as the United Kingdom and Australia. It also raises the experience of the European Takeover Bid Directive, which Professor Hopt has described as "sobering", in view of the large number of members states adopting a protectionist stance towards the directive's implementation.

The theme of protectionism in takeovers is continued in discussion of takeovers and takeover defences in relation to two major Asian economies, Japan and China. As the paper shows, in spite of the apparent promise of open capital markets offered by globalization, protectionism is on the rise internationally and takeovers play a central role in this evolving story.

Financing as Governance-Dr Fleur Johns

Built environments, and social and legal interactions through them, are powerfully shaped by the arrangements by which their making and remaking are financed. There is a rich and extensive literature analysing shifts towards private and/or offshore financing of infrastructure in broad terms and their implications for governmental accountability and so-called public interest values. At the level of mundane regulatory decision and technique, however, the ways in which governance may be affected by such financing arrangements have not been well mapped. The article considers some governance implications of the practice of funding urban infrastructure projects by recourse to global financial markets. It focuses, in particular, upon how regulatory decision-making may be shaped by technical practices of financial deal-making, financial modelling and related re-configurations of institutional or jurisdictional space. These implications are explored by reference to some recent examples of urban toll-road financing in Sydney and decision-making and analysis surrounding those examples. As such, it joins with other recent scholarship in probing political dimensions of technical forms of knowledge and practice that have frequently fallen between the cracks of legal scholarship's interdisciplinary inquiries to date.

Legislating Principles as a Remedy for Tax Complexity-Professor Graeme Cooper

This article considers the recent experiment in the "principles-based drafting" of tax legislation in the UK, in the light of the experience in Australia during the last 8 years. The article examines the genesis of this experiment in the tax re-writing projects that started in the 1990s, the metes and bounds of the notion of "principles-based drafting," the allure it holds for policy-makers and some of its implications for taxpayers, revenue administrators, tax policy-makers and judges. Two examples of "principles-based drafting" that have been enacted in the Australian tax legislation are examined in detail, confirming some of the predicted difficulties. The article considers whether the experiment is proving successful and whether the initial enthusiasm for the practice will continue.

Travellers, Tax Policy and Agency Permanent Establishments-Professor Richard Vann

This article analyses the policy, historical development and current application of permanent establishment rules for travellers. It is readily accepted that pedlars and itinerant merchants do not give rise to permanent establishments but after many years of the agency permanent establishment rules apparently requiring that the agent have a fixed place of business in the country concerned, the OECD has recently concluded to the contrary for travelling salesmen. The article argues that the OECD should have followed the historical trend as that matches the OECD's proclaimed policies for adopting the permanent establishment as the international threshold for taxing business income more closely.

'Liable to Tax' and Company Residence under Tax Treaties-Professor Richard VannThis paper considers the application to companies of the "liable to tax" residence test in the first sentence of article 4(1) of the OECD Model along with its elaboration in the second sentence with a focus on the policy and history of the test to see what assistance they provide for modern day interpretation.
Accordingly the first section asks what is the purpose of the company residence test in tax treaties (as opposed to the residence test generally) which requires a broad but brief overview of the operation of the company tax and how companies are dealt with in treaties. The second - and main - section then turns to history to see to what extent policy may have been a guide in the development of the company residence test in treaties and what those who developed the test may have intended by the liable to tax test in relation to companies. The third section uses such guidance as may be obtained from the policy and history to analyse some current company residence issues. The fourth section provides some necessarily tentative conclusions.

Contact: Greg Sherington

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