Is the Corporations Law Still Too Complex?

id down, and makes same rules apply to all types of companies. It also replaces mandatory procedures involving auditors, experts, advertisements and declarations of solvency with new safeguards. All these provisions are included in 11 sections with about 3,000 words, compared to old provisions that were consisting of 89 sections using more than 20,000 words.(6) The Simplification Act abolished several company registers. It worked out uniform rules in one place for registers of members, option holders and debenture holders. Before the Simplification Act was finally passed, the Second Corporate Law Simplification Bill has been released for public consultation. As the Federal Government was changed, the Second Corporate Law Simplification Bill was replaced with the Company Law Review Bill 1997 and was finally passed in late June 1998 as the Company Law Review Act 1998 (Cth) (CLRA98) and commenced on 1 July 1998. The objective of the CLRA98 is stated as "to improve the efficiency of corporate regulation, and reduce regulatory burdens on business and other users of the Corporations Law."(7) The CLRA98 made significant changes to the Corporations Law. The need of drafting a constitution was abolished. Existing companies may choose to maintain their original memorandum and articles of association as their corporate constitution, or to adopt a new constitution or repeal the memorandum and apply to the replaceable rules. Companies registered after 1 July 1998 can choose whether or not adopt a corporate constitution. The replaceable rules apply to all new companies unless they are displaced or modified by the corporate constitution. As to the share capital, the changes include that the par value for shares and the concept of authorised share capital are abolished, the need for court approval for capital reductions and the shareholders' approval for financial assistance are also removed, and a number of changes are made with respect to the procedures for the issuing of shares. Other features include that the procedures for establishing, running and de-registering a company were simplified, electronic commerce is to be encouraged for meetings and lodging documents with ASIC, the need to hold formal meetings for proprietary company is reduced, and the size of annual returns and the costs of annual reports are reduced. While the contents are changed, the drafting was also clarified with plain English; as a result, there was a 43% reduction in words (from 95,000 words to 54,000 words).(8) As mentioned above, the Corporate Law Simplification Program was replaces by the CLERP following the change of the Federal Government. The objective of the CLERP was "to ensure that business regulation is consistent with promoting a strong and vibrant economy and provides a framework which assists business in adapting to change".(9) Accordingly, the reforms of companies and securities regulation aimed to "facilitate a more efficient and competitive business environment".(10) "As part of the Coalition Government's drive to promote business and economic development",(11) the CLERP adopted an economic approach to corporate regulation. The key principles include market freedom, investor protection, information transparency, cost effectiveness, regulatory neutrality and flexibility, and business ethics and compliance. The main features of the reform agenda are summarised as follows: ?facilitating corporate fundraising, including improving disclosure and facilitating fundraising by small and medium sized enterprises; ?improving corporate governance, including clarifying directors' duties and greater accountability to shareholders; ?making accounting standards more useful for business; ?streamlining takeover rules, including mandatory bid, compulsory acquisitions, takeovers panel and listed managed investments; ?fostering electronic commerce; and ?streamlining regulation of financial markets and products. After the CLERP ha