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ARTICLE · 13 DECEMBER 2007

News Alert - Unacceptable Circumstances Avoided: Takeovers Panel Declared Consistently Valid

Minter Ellison
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The Court found that section 657(A)(2)(b) of the Corporations Act – which empowers the Takeovers Panel to make findings about breaches of the takeovers provisions of the Act – is constitutionally valid.

AustraliaCorporate/Commercial Law
Ron Forster
Ron Forster

The High Court today made orders in AG (Cth) v Alinta Ltd. The Court found that section 657(A)(2)(b) of the Corporations Act (the Act) – which empowers the Takeovers Panel (the Panel) to make findings about breaches of the takeovers provisions of the Act – is constitutionally valid.

The decision is welcome news, as it avoids the uncertainty that would have occurred in the market at a time of unprecedented takeover activity. It is business as usual for the Panel. The Panel has issued a media release today advising that it will once again accept applications founded on a breach of the takeover provisions of the Act.

The Constitutional challenge to section 657(A)(2)(b) was made by Alinta Ltd. In April 2006, Alinta and Australian Gas Light Company Limited (AGL) merged some of their interests. Following the merger arrangements, Alinta acquired AGL's 30% holding in Australian Pipeline Trust (APT) (a managed investment scheme). In August 2006, Alinta also purchased a 10.25% interest in

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