EXPLANATORY STATEMENT
Select Legislative Instrument 2010 No. 47
Issued by the authority of the
Judges of the Federal Court of Australia
Federal Court (Corporations) Amendment Rules 2010 (No. 1)
Section 59 of the Federal Court of Australia Act 1976 permits the Judges of the Court or a majority of them, to make rules of Court not inconsistent with the Act. These rules may provide for the practice and procedure to be followed in the Court and in Registries of the Court. They may extend to all matters incidental to any such practice or procedure that are necessary or convenient to be prescribed for the conduct of any business of the Court.
Under sub-section 59 (4) of the Federal Court of Australia Act 1976, the Legislative Instruments Act 2003 (other than sections 5, 6, 7, 10, 11 and 16 of that Act) applies in relation to rules of court made by the Court under the Federal Court of Australia Act 1976 or another Act:
(a) as if a reference to a legislative instrument were a reference to a rule of court; and
(b) as if a reference to a rule-maker were a reference to the Chief Justice acting on behalf of the Judges of the Court; and
(c) subject to such further modifications or adaptations as are provided for in regulations made under section 59A of the Federal Court of Australia Act 1976.
The Federal Court (Corporations) Rules 2000 apply to a proceeding in the Court under the Corporations Act 2001 or the Australian Securities and Investments Commission Act 2001 commenced on or after 1 January 2000.
The Judges have agreed to amend the Federal Court (Corporations) Rules 2000 to give effect to a recommendation of the Council of Chief Justices’ Harmonised Corporations Rules Monitoring Committee.
These Amendment Rules will amend the Federal Court (Corporations) Rules 2000 by amending Form 19, Consent to Act as designated person, so as to include a reference to the administration and realisation, as well as the distribution, of assets. This change is consequential upon amendments made in 2009 to rule 15A.5 to ensure that it is consistent with the terms of articles 19 and 21 of the Model Law on Cross-Border Insolvency of the United Nations Commission on International Trade Law which operates in Australia pursuant to the Cross-Border Insolvency Act 2009 (Cth).
The amendments have been the subject of consultation with the Insolvency Practitioners Association of Australia and the Law Council of Australia.
Details of the Rules are in the Attachment.
The Rules commence on the day after they are registered.
ATTACHMENT
Federal Court (Corporations) Amendment Rules 2010 (No. 1)
RULE 1 Name of rules
This rule provides that the Rules are to be cited as the Federal Court (Corporations) Amendment Rules 2010 (No. 1).
RULE 2 Commencement
This rule provides that these Rules commence on the day after they are registered.
RULE 3 Amendment of Federal Court (Corporations) Rules 2000
This rule provides that the Federal Court (Corporations) Rules 2000 are amended as set out in Schedule 1.
SCHEDULE 1
[1] Form 19
Form 19 is the prescribed form for consent to act as a designated person. It is required pursuant to rule 15A.5.
Rule 15A.5 provides that if the relief sought in an application under article 15 of the Model Law on Cross-Border Insolvency of the United Nations Commission on International Trade Law which operates in Australia pursuant to the Cross-Border Insolvency Act 2009 (Cth) (the Model Law) includes an order under article 19 or 21 to entrust the administration, realisation or distribution of the debtor’s assets to a person designated by the Court (other than the foreign representative), then that person must be an official liquidator and have filed a Consent to Act in accordance with Form 19.
Form 19 is amended by replacing the word ‘distribute’ with the words ‘*administer/*realise/*distribute’ so that it is consistent with rule 15A and articles 19 and 21 of the Model Law.
Overview
The Federal Court (Corporations) Amendment Rules 2010 (No. 1) were enacted to amend the Federal Court (Corporations) Rules 2000 in light of changes made to the Cross-Border Insolvency Act 2009 (Cth), which implements the United Nations Commission on International Trade Law’s Model Law on Cross-Border Insolvency in Australia. This amendment was introduced to ensure consistency between the Federal Court (Corporations) Rules and the Model Law, particularly in the context of appointing designated persons to administer, realise, and distribute a debtor's assets in cross-border insolvency proceedings. The Judges of the Federal Court of Australia, under the authority granted by section 59 of the Federal Court of Australia Act 1976, made these amendments to maintain alignment with international standards and practices, facilitating smoother and more efficient cross-border insolvency processes. The rules were subject to consultation with relevant professional bodies and were designed to achieve the policy objective of harmonising corporation-related proceedings with international insolvency law.
Scope and Application
The Federal Court (Corporations) Amendment Rules 2010 (No. 1) apply to proceedings in the Federal Court of Australia involving the Corporations Act 2001 or the Australian Securities and Investments Commission Act 2001 that commenced on or after 1 January 2000. These rules, made under the authority granted by section 59 of the Federal Court of Australia Act 1976, amend the Federal Court (Corporations) Rules 2000 to align with the Model Law on Cross-Border Insolvency of the United Nations Commission on International Trade Law, which operates in Australia pursuant to the Cross-Border Insolvency Act 2009 (Cth). Specifically, the amendment modifies Form 19, Consent to Act as designated person, to include references to the administration and realisation, in addition to the distribution, of assets. This change follows amendments made in 2009 to rule 15A.5 to ensure consistency with articles 19 and 21 of the Model Law. The rules have been subject to consultation with relevant professional bodies and associations, including the Insolvency Practitioners Association of Australia and the Law Council of Australia. These amendment rules commence on the day after they are registered, and their application is subject to the legislative framework provided by the Legislative Instruments Act 2003, with specific adaptations for rules of court as outlined in the Federal Court of Australia Act 1976.
Key Provisions
The Federal Court (Corporations) Amendment Rules 2010 (No. 1) primarily amend the Federal Court (Corporations) Rules 2000 to update the form required for consent to act as a designated person, specifically Form 19 (rule 3). This amendment is consequential to the changes made in 2009 to rule 15A.5, and ensures consistency with the Model Law on Cross-Border Insolvency of the United Nations Commission on International Trade Law as it operates in Australia under the Cross-Border Insolvency Act 2009 (Cth). The form is now required to include references to the administration and realisation of assets, in addition to their distribution, as specified in articles 19 and 21 of the Model Law (Schedule 1, [1]).
These amendments impose specific obligations on parties seeking to act as designated persons in cross-border insolvency proceedings under the Corporations Act 2001 or the Australian Securities and Investments Commission Act 2001. If the relief sought in such an application includes an order to entrust the administration, realisation, or distribution of the debtor’s assets to a person designated by the Court (other than the foreign representative), that person must be an official liquidator and must file a Consent to Act in accordance with the updated Form 19 (rule 15A.5). The form must now reflect the responsibilities of administering and realising assets, aligning with the requirements of the Model Law.
Breach of the obligations set out in the Federal Court (Corporations) Amendment Rules 2010 (No. 1) may lead to procedural issues in the Court, potentially resulting in delays or the rejection of applications. However, the Rules themselves do not explicitly outline specific offences, penalties, or civil/criminal consequences for non-compliance. The primary focus is on ensuring consistency with international standards and the proper administration of justice in cross-border insolvency cases. The legislative instruments act under the Federal Court of Australia Act 1976 applies to these rules, providing a framework for their enactment and regulation.