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The Department of Home Affairs has issued its draft guidance “Modern Slavery Act 2018: Draft Guidance for Reporting Entities” (Draft Guidance) for the new Modern Slavery Act 2018 (Cth) (the Act).
2019/2020 Federal Budget. With the Federal election anticipated to be roughly 5 weeks away, the extent of largesse in last week’s budget should be unsurprising. Treasurer Josh Frydenburg’s first budget predicts an operating surplus for the first time in 12 years, although some commentators have suggested that, just as the surplus was made possible by surging commodity prices and strong employment, it may disappear if commodity prices weaken and unemployment creeps up. Other key themes include a further $25 billion in infrastructure spending, tax relief measures for middle income earners, $1 billion funding for the ATO over the next 4 years, a $75 cash payment to ease power bill pain for consumers and various initiatives to grow jobs. See G+T’s article “Australian Federal Budget Analysis 2019/2020” for more detailed commentary.
Government releases draft guidance on new modern slavery law. Entities with over $100 million annual consolidated revenue (including corporate Commonwealth entities and foreign entities carrying on business in Australia) must now comply with a new modern slavery annual reporting requirement. The Government’s draft guidance: (i) clarifies some of the key terms and concepts in the law; (ii) provides practical tips on how to draft a Modern Slavery Statement (including how to address each of the mandatory reporting criteria and prepare joint statements); (iii) suggests ways for assessing the effectiveness of anti-slavery actions; and (iv) sets out indicators for identifying key modern slavery risks in supply chains. Submissions can be made until 19 May 2019. See G+T’s report “Eradicting Modern Slavery: How the new Modern Slavery Act affects your organisation” for more information.
RBA releases its April Statement on Monetary Policy. As anticipated, last Tuesday’s meeting saw the RBA hold the cash rate at 1.5%, and its views on economic outlook were largely unchanged. The RBA emphasised again that low rates are continuing to support the Australian economy, but growth has slowed and downside risks have increased (perhaps giving greater credence to predictions for a May rate cut). GDP was only up by 0.2% in the December quarter but a significant increase in employment was notable, with the unemployment rate sitting at 4.9%. Inflation remains low and stable. You can read the RBA’s Statement here.
ASIC releases draft Cost Recovery Implementation Statement (CRIS). ASIC’s Cost Recovery Implementation Statement (CRIS) includes: (i) details of how ASIC allocated its regulatory costs in 2017–18; (ii) estimates of industry sector levies for 2018–19; and (iii) indicative levies for ASIC’s regulatory costs in the 2018–19 financial year. Actual levies (once known) won’t be billed until January 2020. Feedback on the CRIS can be made until 26 April 2019. ASIC will release the final CRIS in May 2019.
Employee share scheme reforms. As part of the Government’s agenda to support small businesses, it is consulting on measures designed to encourage employee share schemes for start-ups. These include: (i) consolidating exemptions and class order relief from disclosure, licensing, hawking and advertising; (ii) increasing the value limit of eligible financial products that can be offered by unlisted companies in a 12 month period from $5,000 to $10,000 per employee; (iii) expanding relief for unlisted companies to cover contribution plans, where an employee can make a monetary contribution to acquire financial products; and (iv) allowing small businesses to offer employee share schemes without publicly disclosing commercially sensitive financial information in lodged disclosure documents, unless they are otherwise obligated to do so. Submissions can be made until 30 April 2019.
ASX releases Activity Report for March 2019. ASX’s Group Monthly Activity Report for March 2019 notes that total capital raised during the month was $5.3 billion, down 8% on the previous corresponding period (pcp). The average number of daily trades was 27% higher than the pcp and the average daily value traded on-market was $5 billion, 14% higher than the pcp. Average daily options volume was up 151% on the pcp, while the value of securities held in CHESS was 8% higher.
Election Date. Odds are now firming for an 18 May federal election date, with 11 May seen as too close to the elongated Easter / Anzac Day holiday period. A reminder to Directors that the announcement of the election will trigger the implementation of Government caretaker protocols, which may slow the machinery of Federal Government somewhat.
UK requests until 30 June to leave the EU. With the UK at an impasse, the request for a short extension follows a controversial vote passed by UK Parliamentarians to make it, in a bid to avoid a no-deal scenario. An emergency summit of EU leaders on Wednesday will consider the UK’s request. Senior EU sources suggest the EU may grant a 12-month “flexible” extension with the option of cutting it short if the UK ratifies a deal ‑ a move likely to be unpopular with businesses exhausted by the uncertainty.