The federal government has announced plans for a High Court appeal to confirm the powers of the Takeovers Panel, following a surprise Federal Court ruling in a case involving Alinta Ltd that cast doubt on the future of the panel.
Treasurer Peter Costello said the Federal Court ruling on a dispute that emanated from Alinta Ltd's purchase of units in Australian Pipeline Trust had created uncertainty in the takeovers market and undermined the role of the Panel.
His comments followed a statement earlier this week by the Panel, which claimed that it would still be able to deal with most takeover disputes using residual powers that were not affected by the Federal Cort decision.
The Federal Court ruled that the Panel could not use its powers under section 657A(2)(b) of the Corporations Act.
In its statement, the Panel said it was "confident that the vast majority of disputes concerning takeovers are able to be framed in terms of section 657A(2)(a). The Panel considers that very few, if any, persons will be left without a forum for resolution of their disputes following the Federal Court's decision in relation to section 657A(2)(b)".
Today's statement by Treasurer Peter Costello and Attorney General Philip Ruddock is pasted below:
The Takeovers Panel plays a vital and integral role in resolving takeovers-related disputes during the bid period. It provides interested parties with an efficient means of resolving disputes without costly and time-consuming litigation.
The recent decision of the Full Federal Court in Alinta Limited v Takeovers Panel has created uncertainty in the takeovers market. The Court, by majority, held that section 657A(2)(b) of the Corporations Act 2001 is invalid on the ground that it confers judicial power upon the Takeovers Panel contrary to the Australian Constitution.
The decision undermines the objective that the Takeovers Panel be the primary forum for the resolution of takeovers disputes.
The Attorney-General will apply to the High Court for special leave to appeal the decision of the Full Federal Court to defend the validity of the challenged provisions of the Act.
CANBERRA
3 May 2007
