A common hurdle faced by many early-stage start-ups is trying to raise capital where the company has not yet attained sufficient financial information and/or market data in respect of the business, which makes it difficult to assign a justifiable and substantiated value to the company.

SAFE (simple agreement for future equity) notes are documents that start-ups may consider using to help raise seed capital where there is limited financial data, and or a consistent source of revenue over a tracked period of time.

A SAFE note is a legally binding promise that allows an investor to purchase a specified number of shares for an agreed-upon price at some point in the future.

With the increasing prevalence of malicious cyberattacks, new regulations have been introduced to ensure that the government has knowledge of cyber incidences affecting specific entities in the following industries:

• electricity
• communications
• data storage or processing
• financial services
• water
• healthcare and medical
• higher education and research
• food and grocery comment transport
• space technology

By implementing a mandatory reporting regime, the government seeks to strengthen the security and resilience of critical infrastructure, by empowering the relevant authorities to more immediately address critical cyber incidents - and to develop responses and protections to minimise the risk of future incidents occurring.

It has happened: a company that failed to implement proper cyber security measures in Australia has been taken to court by the regulators, with the company ordered to pay costs of $750,000.

In the matter of the Australian Securities and Investments Commission v RI Advice Group Pty Ltd [2022] FCA 496, the Court found that a financial services provider had breached its licence obligations, and failed to act efficiently or fairly by not having in place adequate risk management systems to cater for risks arising in relation to cyber security.

The Federal Court of Australia’s recent judgment in the matter of Energy Resources of Australia Limited [2022] FCA 176 demonstrates the risks to resigning company directors when they, or the company, fail to notify ASIC of their resignation in a timely manner – as well as the consequent time, effort and costs needed to rectify these failures.

The decision is also a reminder that retiring directors wishing to avoid personal responsibility for a company’s conduct need to notify ASIC promptly and effectively.

Companies can now sign documents by electronic means and with directors using electronic signatures. 

On 10 February 2022, the Australian Senate passed the Corporations Amendment (Meetings and Documents) Bill 2021.  The passing of the Bill now clarifies the execution requirements of companies when signing documents (including deeds) - whether in physical or electronic form, or a hybrid of physical and electronic.

The Office of the Australian Information Commissioner (‘OAIC’) has released its 2020–21 annual report and performance statement.

In the past 12 months, the OAIC has sought to establish strong privacy protections to both increase public confidence in the use of personal information, and minimise the public health risks associated with COVID-19.

If you purchased a business and the sale included all of the business’s computers, would it be reasonable to expect to be able to use the software installed on those computers?

In the recent matter of QAD Inc v Shepparton Partners Collective Operations Pty Ltd [2021] FCA 615, the Federal Court ordered Shepparton Partners Collective Operations Pty Ltd (‘SPC’) to pay $1M+ in damages to software company QAD Inc (‘QAD’), after finding that SPC had infringed copyright after purchasing the business from Coca-Cola Amatil (‘CCA’) without having secured a transfer of the relevant software licence agreement.

• After the sale QAD required payment of a fee as a condition for its consent to transfer the licence, which SPC refused to pay.
• SPC denied that it had infringed copyright, claiming that it had an implied licence from QAD to use the software.
• SPC cross-claimed against Sale Co 1 Limited (‘SaleCo’) and CCA on the basis they had failed to use their ‘best endeavours’ to secure a transfer of the licence agreement.

Back in February 2020, Holman Webb published an article ‘AI and Facial Identification Technology – the Face of the Future?’, which referred to an article in the New York Times highlighting Clearview AI, and the use of the company’s facial recognition technology by law enforcement agencies internationally.

At the time the Australian Parliament was considering the introduction of the Identity-matching Services Bill 2019 and Australian Passports Amendment (Identity-matching Services) Bill 2019 which would enable the Department of Home Affairs and Foreign Affairs and Trade to utilise similar facial recognition technology.

As it turns out, Holman Webb Lawyers were not the only ones taking a close look at Clearview AI. Since that time, it appears that Clearview AI was offering free software trials to numerous law enforcement agencies within Australia, some of whom have commenced their investigation into the use of the app and have been feeding visual data into the system.

The Franchising Code of Conduct may be about to change again - this time, to introduce a ‘Franchise Disclosure Register’.

It remains to be seen whether the exposure draft of the changes will become law (through changes to the Code), and if so whether any amendments are made as a result of the consultation process. Regardless - in anticipation, Holman Webb’s Franchising & Retail Group has answered some FAQs in respect of the introduction of the register.

The new Director Identification Number regime commenced on Monday 1 November 2021. 

If you are a company director, you are now required to have your own unique Director Identification Number - a 15 digit identification number issued by the Australian Business Registry Services. 

You only need to apply for it once, and you keep it forever.