CATCHWORDS CORPORATIONS - Shares - Secondary Notices issued by Australian Securities Commission to foreign corporation - Compliance risks breach of foreign law - whether foreign corporations bound to comply with notices under Corporations Law, s.722. Secondary Notices - whether notices can be given to foreign corporations where to do so contravenes foreign law - whether notices can be served by fax under Corporations Law, s.719. Secondary Notices - whether letters constitute "request" for exemption under Corporations Law, s.721 - whether decision on request vitiated by pre-judgment or failure to take into account relevant considerations. Substantial Shareholder Notices - whether foreign corporation obliged to give notice if to do so risks contravention of foreign law - whether foreign corporation is a "bare trustee" of shares for the purposes of Corporations Law s.39(b). Secondary Notices - failure to comply - power to excuse non-compliance under Corporations Law, s.743 - whether foreign corporations should be excused from non-compliance - nature of relief to be granted. Corporations Law, ss 39(b), 109X, 110D, 603, 613, 708, 709, 719, 721, 722, 741, 742, 743, 744. Polites v The Commonwealth (1945) 70 CLR 60. Re North Broken Hill Holdings Pty Ltd (1986) 10 ACLR 270. Arhill Pty Ltd v General Terminal Co Pty Ltd (1990) 23 NSWLR 545. De Beeche v The South American Stores (Gath and Chaves) Ltd [1935] AC 148. Societe Internationale Pour Participations Industrielles et Commerciales, SA v Rogers 357 US 197 (1958). Federal Trade Commission v Compagnie de Saint-Gobain-Pont-A-Mousson 636 F2d 1300 (1980). Adsteam Building Industries Pty Ltd v The Queensland Cement and Lime Company Ltd (No.4) [1985] 1 Qd R 127. Hastie & Jenkerson v McMahon [1990] 1 WLR 1575. Electronic Rentals Pty Ltd v Anderson (1971) 124 CLR 27. Little v Minister for Land Management (1992) 77 LGRA 346. Air-India v Wiggins [1980] 1 WLR 815. Corumo Holdings Pty Ltd v C. Itoh Pty Ltd (1991) 24 NSWLR 370 Regazzoni v K C Sethia (1944) Ltd [1958] AC 301. Federal Trade Commission v Comagnie de Saint-Gobain-Pont-A-Mousson 636 F2d 1300 (1980) Attorney-General (United Kingdom) v Heinemann Publishers Australia Pty Ltd (1988) 165 CLR 30. NM Superannuation Pty Ltd v Hughes (1992) 27 NSWLR 26. Laws v Australian Broadcasting Tribunal (1990) 170 CLR 70. AUSTRALIAN SECURITIES COMMISSION v BANK LEUMI LE-ISRAEL & ORS NG 3201 of 1995 Sackville J. Sydney 14 December, 1995 IN THE FEDERAL COURT OF AUSTRALIA) NEW SOUTH WALES DISTRICT REGISTRY) No. NG 3201 of 1995 GENERAL DIVISION ) BETWEEN: AUSTRALIAN SECURITIES COMMISSION Applicant AND: BANK LEUMI LE-ISRAEL First Respondent EBC ZURICH AG Second Respondent A.N.Z. NOMINEES LTD Third Respondent BB NOMINEES PTY LTD Fourth Respondent NATIONAL NOMINEES LTD Fifth Respondent GALAH NOMINEES PTY LTD Sixth Respondent STATTON NOMINEES PTY LTD Seventh Respondent OFFSET ALPINE PRINTING GROUP LTD Eighth Respondent ARKLOW PTY LTD Ninth Respondent Coram: Sackville J. Place: Sydney Date: 14 December, 1995 MINUTES OF ORDER THE COURT DIRECTS THAT: 1. The applicant bring in short minutes of order giving effect to these reasons for judgment. 2. These proceedings be re-listed for any further argument as to the form of orders and submissions relating to costs. NOTE:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. IN THE FEDERAL COURT OF AUSTRALIA) NEW SOUTH WALES DISTRICT REGISTRY) No. NG 3201 of 1995 GENERAL DIVISION ) BETWEEN: AUSTRALIAN SECURITIES COMMISSION Applicant AND: BANK LEUMI LE-ISRAEL First Respondent EBC ZURICH AG Second Respondent A.N.Z. NOMINEES LTD Third Respondent BB NOMINEES PTY LTD Fourth Respondent NATIONAL NOMINEES LTD Fifth Respondent GALAH NOMINEES PTY LTD Sixth Respondent STATTON NOMINEES PTY LTD Seventh Respondent OFFSET ALPINE PRINTING GROUP LTD Eighth Respondent ARKLOW PTY LTD Ninth Respondent Coram: Sackville J. Place: Sydney Date: 14 December, 1995 REASONS FOR JUDGMENT INDEX Page I INTRODUCTION 4 - The Proceedings 4 - The Relief Sought 5 - Other Parties 7 - Timing 8 II THE FACTS 8 - Background 8 - The Secondary Notice to Leumi 11 - Leumi's Response 14 - The ASC's Decision in Relation to Leumi 15 - The Second Secondary Notice to Leumi 17 - Leumi's Application to the Administrative Appeals Tribunal 18 - Secondary Notice to EBC 18 - EBC's Response 19 - The ASC's Decision in Relation to EBC 21 - The Take-Over Offers 22 III THE LEGISLATION 23 - Information as to Beneficial Ownership: Part 6.8 24 - Substantial Shareholdings Provisions: Part 6.7 28 - Power to Excuse Contraventions 31 - Extraterritorial Operation of the Corporations Law 32 - Service of Notices 32 IV THE ISSUES 33 V THE EXPERT EVIDENCE 35 - The Expert Witnesses 35 - Swiss Law 37 - Article 273 39 - Article 271 43 - Article 47 of the Banking Law 46 - VI WERE LEUMI AND EBC OBLIGED TO COMPLY WITH THE SECONDARY NOTICES, NOTWITHSTANDING THAT COMPLIANCE PLACED THEM AT RISK OF VIOLATING SWISS LAW? 47 - Background 47 - Principles of Construction 49 - Part 6.8 of the Corporations Law 54 - Enforcement and Prescription Jurisdiction 60 - Attorney-General v Heinemann 62 - Self-Incrimination 63 VII WAS SERVICE OF THE SECONDARY NOTICE IN SWITZERLAND AUTHORISED BY THE CORPORATIONS LAW? 67 - The Submissions 67 - The Question of Construction 68 VIIIWAS SERVICE OF THE SECONDARY NOTICES BY FAX AUTHORISED BY THE CORPORATIONS LAW? 75 - The Arguments 75 - The Authorities 77 - The Construction Issue 79 - An Original Document? 82 IX WERE THE SECONDARY NOTICES INVALID BY REASON OF ANY PRE-JUDGMENT BY THE ASC? 84 X DID THE ASC FAIL TO CONSIDER PROPERLY REQUESTS MADE BY LEUMI AND EBC UNDER s.721? 87 - Background 87 - Did Leumi Make a Request? 89 - Did EBC Make a Request? 91 - Pre-Judgment by the ASC 92 - Alleged Failure to Take Into Account Relevant Considerations 95 XI DID LEUMI AND/OR EBC CONTRAVENE THE SUBSTANTIAL SHAREHOLDER PROVISIONS? 97 - Application of s.709 97 - Substantial Shareholder: Leumi 102 - Substantial Shareholder: EBC 106 XII SHOULD LEUMI AND/OR EBC BE EXCUSED FROM THEIR CONTRAVENTIONS UNDER s.743? 107 - The Arguments 107 - Exercise of Discretion 109 XIIIWHAT RELIEF SHOULD BE GRANTED? 116 - The Submissions 116 - The Relief 119 I. INTRODUCTION The Proceedings In these proceedings the applicant, the Australian Securities Commission ("ASC"), seeks relief against two Swiss corporations in respect of what it claims are breaches of the Corporations Law. The corporations are the first respondent, Bank Leumi Le-Israel ("Leumi") and the second respondent, EBC Zurich AG ("EBC"). The ASC alleges, among other things, that Leumi and EBC have failed to comply with secondary notices issued by the ASC under the Corporations Law. The secondary notices required them to provide information concerning their shareholdings in an Australian company. The ASC also alleges that Leumi and EBC have failed to comply with the substantial shareholder notice provisions of the Corporations Law. Leumi and EBC deny that they have been, or are, in breach of the Corporations Law. They raise many issues by way of defences to the ASC's allegations. At the forefront are their claims that compliance with the notices and with the substantial shareholder provisions, would cause them to breach Swiss law. They argue that the Corporations Law should not be construed so as to require foreign corporations to breach the law of the country in which they are incorporated and conduct business. Leumi and EBC also claim that service of the secondary notices on them breached Swiss law and was not authorised by the Corporations Law. The Relief Sought The proceedings were commenced by the ASC on 3 May 1995. The relief claimed by the ASC in its further amended statement of claim includes declarations that Leumi and EBC have contravened s.722(1) of the Corporations Law, by failing to comply with secondary notices served on them by the ASC in relation to shares held by them in the eighth respondent, Offset Alpine Printing Group Ltd ("OAP"). The ASC also seeks declarations that Leumi and EBC have contravened s.709(1) of the Corporations Law, in that each was a substantial shareholder in OAP but had failed to give the required written notice to OAP specifying their interests. The ASC claims consequential relief, including l orders that Leumi and EBC comply with the secondary notices; l orders that Leumi and EBC give written notices complying with s.709 of the Corporations Law; l orders that the shares be vested in the ASC absolutely or subject to such terms and conditions as the Court thinks fit; l in the alternative, orders that the nominee companies (the third to the seventh respondents), who are the registered owners of the shares in OAP held on behalf of Leumi and EBC, divest themselves of the shares; l reservation of liberty to apply to any person claiming an interest in the shareholdings of Leumi and EBC in OAP. On 4 May 1995, interlocutory orders were made restraining Leumi and EBC from giving instructions for their shares in OAP to be disposed of and restraining the other respondents from disposing of any shares in OAP held by them on behalf of Leumi or EBC. OAP was directed, subject to further order of the Court, to disregard the exercise of any rights in respect of the shares by the third to the seventh respondents, each of which is a nominee company holding shares in OAP on behalf of Leumi and EBC. OAP was also restrained from registering a transfer or transmission of any shares in OAP held by Leumi or EBC. These orders remain in place. Leumi and EBC entered unconditional appearances in the proceedings. Each has been separately represented and has opposed the relief sought by the ASC. At the hearing Leumi was represented by Mr R. White, who appeared with Ms Wines. Mr Conti QC appeared with Mr Kunc for EBC. Both Leumi and EBC filed cross-claims. As amended, Leumi's cross-claim seeks an order under s.11 of the Administrative Decisions (Judicial Review) Act 1975 (Cth) ("ADJR Act") extending the time for filing an application to review a decision made by the ASC on 5 September 1995. That decision was to refuse what Leumi claimed was a request under s.721 of the Corporations Law, that the ASC certify that there were special reasons why the information sought in the secondary notices did not have to be given. The amended cross claim also seeks an order quashing the ASC's decision to refuse the request. EBC's cross-claim seeks orders pursuant to s.743 of the Corporations Law that, if EBC has contravened s.722, the contravention should be excused. The main argument put in support of the cross claim is that there is a real or serious risk that EBC would be in breach of the Swiss Penal Code if it were to comply with the secondary notices. Other Parties The third to the seventh respondents are nominee companies incorporated in Australia. Only one of these, the fifth respondent (National Nominees Ltd), appeared in the proceedings. However, it has submitted to the orders of the Court and has played no part in the hearing. OAP was represented at the hearing by Mr Oakes SC. He argued that any relief granted by the Court should allow the shares held by Leumi and EBC to be sold, in the interests of an efficient market in OAP shares. OAP relied on the fact that by the date of the hearing, two companies, Fobiti Pty Ltd ("Fobiti") and Arklow Pty Ltd ("Arklow") had made competing offers to acquire the whole of the issued share capital of OAP. At the hearing, Mr Muddle announced an appearance for Arklow and sought an order joining Arklow as a respondent to the proceedings. He did so primarily on the ground that Arklow, having made a take-over offer for all shares in OAP, wished to be heard on the form of relief, if any, to be granted to the ASC. Mr Lindsay SC, who appeared for the ASC, did not object to this course. None of the other respondents objected. Accordingly, I made an order joining Arklow as the ninth respondent, subject to an undertaking, given on its behalf by Mr Muddle, that Arklow would not seek costs from any other party. Timing The hearing was expedited. At the time the proceedings were set down for final hearing, only the first takeover offer had been made. It was expressed to expire on 29 November 1995. Since that time two other offers have been made, one of which is a revised offer by the original offeror, Fobiti. Those offers expire, unless extended, on 29 December 1995. In accordance with the parties' request, this judgment has been prepared in sufficient time to enable final orders to be made before the expiration of the current offers. II THE FACTS Background OAP is a company incorporated in Victoria. It was previously known as Oilmet Resources NL. At all material times, OAP has been admitted to the Official List of the Australian Stock Exchange ("ASX"). Its principal activity is printing. On 5 April 1995, the ASC was informed by the ASX of ASX investigations into the trading of OAP securities. The ASX was concerned that there may have been a failure to comply with the substantial shareholder notice provisions of the Corporations Law. This concern apparently arose out of the fact that the ASX had received information that Leumi and EBC had sold over 720,000 shares into an on-market buy-back scheme for shares in OAP. On 6 April 1995, the ASC obtained a list of the top 40 shareholders in OAP as at 5 April 1995. This showed that the shareholders in OAP included: l the third respondent, A.N.Z. Nominees Ltd ("ANZ Nominees"), holding 4,653,433 shares (19.56% of the issued capital); l the fourth respondent, BB Nominees Pty Ltd ("BB Nominees"), holding 162,437 shares (0.68%); l the fifth respondent, National Nominees Ltd ("National Nominees"), holding 1,214,319 shares (5.10%); l the sixth respondent, Galah Nominees Pty Ltd ("Galah Nominees"), holding 1,783,037 shares (7.49%); and l the seventh respondent, Statton Nominees Pty Ltd ("Statton Nominees"), holding 1,380,818 (5.80%). Between 7 and 10 April 1995, the ASC issued primary notices to those shareholders under s.718 of the Corporations Law. The notices required each recipient to give to the ASC a written statement within two days, providing particulars of all relevant interests in the shareholding of that recipient in OAP. In consequence of the primary notices, the ASC received information that a total of 4,038,600 shares in OAP (16.97% of the issued capital) were held by the recipients of those notices on behalf of Leumi, and 5,293,771 (22.25% of the issued capital) were held on behalf of EBC. The shareholdings revealed by the primary notices are shown in the chart set out below. Leumi is incorporated in Switzerland as a stock corporation and is duly registered with the Commercial Register of the Canton of Zurich. It is a bank, permitted to carry on business subject to the provisions of the Swiss Federal Law on Banks and Savings Banks. Leumi carries on business at offices in Zurich and Geneva. EBC is also a joint stock corporation incorporated in Switzerland and is registered with the Commercial Register of the Canton of Zurich. It is not a bank, but carries on business as a finance company. The Secondary Notice to Leumi On 18 April 1995 the ASC prepared a secondary notice, addressed to Leumi at its address in Zurich, Switzerland. The notice was accompanied by a covering letter, as follows: "I enclose a notice issued pursuant to subsection 719(1) of the Corporations Law requiring information as to the ownership of the shares held by A.N.Z. Nominees Pty Ltd in Offset Alpine Printing Group Limited. ... Please note that the issuing of the attached notice does not amount to an assertion of extraterritorial enforcement jurisdiction because the subject matter of the notice is Australian shares and any enforcement action for non-compliance would occur in Australia in relation to those shares." The notice followed Form 609, which may be used for the purposes of a secondary notice under s.719(1): Corporations Regulations, reg.6.8.01(4). The body of the notice was as follows: "1. Take notice that the Australian Securities Commission pursuant to a primary notice (as defined in section 717 of the Corporations Law), has received information that you are: a.* a person with a relevant interest in (1); or b.* a person who has given relevant instructions (2) in relation to 4,038,600 voting shares in Offset Alpine Printing Group Limited, ACN 003 394 876 that are held by A.N.Z. Nominees Pty Ltd of Level 25, 530 Collins Street, Melbourne VIC 3000. 2. The Commission requires you to give to the Commission: (a) in accordance with subsection 722(1) of the Corporations Law; and (b) within 2 business days after you have received this notice; a statement in writing setting out: (c) full particulars of your relevant interest in those shares and the circumstances because of which you acquired that interest; and (d) so far as you know, full particulars of: (i) the name and address of every other person who has a relevant interest in any of the shares; and (ii)each such interest and the circumstances because of which the person has that interest; and (iii)the name and address of each person who has given you relevant instructions in relation to any of the shares; and (iv)those relevant instructions; and (v) the date(s) on which the instructions were given to you. ... NOTES (1) See Division 5 of Part 1.2 of the Corporations Law (2) See section 717 of the Corporations Law DIRECTION Under subsection 721(1) of the Corporations Law, an application for exemption from providing any or all of the required particulars may be lodged with the Australian Securities Commission within 2 business days after this notice is received. The Australian Securities Commission may, under subsection 721(2), modify this requirement to give information." The document was signed for the ASC "by its delegate Peter Dumas". On 20 April 1995, the letter and the notice were sent by facsimile transmission ("fax") to Leumi at its offices in Switzerland. In its defence, Leumi admitted that the fax was received by it at its office on 20 April 1995, but pleaded that the fax was not received by an officer having responsibility for the matter "until May 1995". The original letter and secondary notice were dispatched by international courier to Leumi at its Zurich address. The letter and notice were delivered at that address on 24 April 1995. On 26 April 1995, the ASC faxed a further letter to Leumi. The letter stated that, unless a satisfactory response to the notice was forthcoming, the ASC intended to apply to the Federal Court to enforce compliance. The letter contained this paragraph: "Further, the Commission does not accept that Swiss Secrecy Regulations are sufficient reason not to provide the information required under the above Notice". Leumi's Response On 27 April 1995, Leumi faxed a letter to the ASC. One of the issues to be decided is whether this letter was a "written request that, for special reasons set out in the request...the information should not be given to [the ASC]", within the meaning of s.721(1) of the Corporations Law. The letter should therefore be set out in full: "Reference is made to your letter dated April 18, 1995, which was received by us on April 24, 1995, as well as your telefax of yesterday. With respect to the notice attached to your aforementioned letter requiring information as to the ownership of the shares held by A.N.Z. Nominees Pty Ltd in OFFSET ALPINE PRINTING GROUP LIMITED we cannot but draw the Commission's attention to our status as a Swiss bank. As such we are subject to Swiss law, in particular Swiss Secrecy Regulations. Therefore, and notwithstanding what is said in para.3 of your yesterday's fax, our bank would clearly and seriously infringe applicable Swiss law by furnishing you with the statement required by the Commission as per the said notice. Please be further advised that the mere fact of this reply may not be interpreted by you and/or the Commission as indication of our bank being aware of any particulars of the subject matter of the notice. We trust that you and the Commission understand our position which is in compliance with applicable Swiss law and appreciate your and the Commission's comprehension." There was subsequent correspondence between the ASC and Leumi's Australian solicitors, to which reference is made below. However, Leumi has not provided the ASC with the information sought in the secondary notices. The ASC's Decision in Relation to Leumi On 22 June 1995, the ASC, without prejudice to its contention that Leumi had lodged no request within the meaning of s.721(1) of the Corporations Law, invited Leumi, through its Australian solicitors, to identify the details of any request that it alleged had been made pursuant to s.721(1). The letter also invited Leumi to make all submissions and provide material that it alleges should be taken into account in considering the request. By a reply of 28 June 1995, Leumi's solicitors identified the letter of 27 April 1995 as constituting the request. The letter continued as follows: "(iv)submissions - the special reasons are set out in the letter, namely that compliance with the notice would infringe Swiss law. Further, by way of submission pertaining to such special reasons, it is submitted that forcing a Swiss resident bank to comply with a notice under Australian law contrary to the provisions of Swiss law, which could cause the imposition of penalties on our client, would be unreasonable and harmful to international comity." Although that letter does not expressly refer to previous correspondence, other than the letter of 27 April 1995, Leumi's solicitors had faxed a letter to the ASC on 21 June 1995. That letter enclosed a memorandum from Dr Schurmann, described as an "independent lawyer practising in Zurich". Dr Schurmann expressed the view that Leumi would contravene Swiss law if it provided the information sought by the ASC, whether in response to the secondary notice or an order of the Federal Court. The letter of 21 June 1995 included the following: "We ask you to carefully consider, again, the difficult position [Leumi] is in and the impossibility of it ignoring Swiss law". On 4 July 1995, the ASC sent a letter to Leumi's solicitors asking a series of detailed questions. Among other things, the letter asked whether Leumi had requested the consent of the beneficial shareholders to compliance with the secondary notices. On 10 July 1995, Leumi's solicitors responded, but did not provide answers to the questions asked, on the ground that the ASC's position required further clarification. At some stage, the date of which does not appear clearly from the evidence, the ASC asked Mr Goldie, a lawyer in its New South Wales Regional Office, to make a decision under s.721: "on the unadmitted assumption that a request has been made by [Leumi] to the ASC on 27 April 1995 that information required by secondary notices given to [Leumi] in April 1995 should not be given to the ASC." Mr Goldie had not previously been involved in ASC's investigation of the ownership of OAP shares, nor in these proceedings. Mr Goldie gave his decision in writing, pursuant to s.721(3) of the Corporations Law, on 5 September 1995. He refused Leumi's request. After identifying the documents which he had considered, he set out his reasons: "The reasons put forward by Bank Leumi for its request to the ASC are that, as a Swiss bank, it is subject to Swiss Secrecy Regulations and it would infringe applicable Swiss law by providing the ASC with the statement required by the ASC's secondary notices given to it in April 1995. I am not satisfied that the reasons put forward by Bank Leumi constitute "special reasons", within the meaning of subsection 721(2) of the Corporations Law, why the information required by the secondary notices given to it in April 1995 should not be given to the ASC. Accordingly Bank Leumi's request is refused. In making this decision I have determined that, on balance, upholding the objects of Part 6.8 of the Corporations Law in maintaining an informed market in shares listed on Australian stockmarkets - which objects could be defeated if the reasons put forward by Bank Leumi constituted "special reasons" under subsection 721(2) of the Corporations Law - outweigh both considerations of international comity in this instance and the possibility that as an indirect consequence of my so finding the Court may, in its discretion, make orders which vest the shares in persons or bodies other than the current beneficial owners of the shares." This decision was notified to the Australian solicitors acting for Leumi on 6 September 1995. The Second Secondary Notice to Leumi On 6 October 1995, the ASC sent a further secondary notice to Leumi, by means of a letter delivered to Leumi's Australian solicitors. The solicitors responded by making a written request pursuant to s.721(1) of the Corporations Law, on behalf of Leumi. The request was that the information sought, except as to 80,000 shares which Leumi held as principal, should not be given, as to do so would contravene art.47 of the Swiss Federal Law on Banks and Savings Banks ("Swiss Banking Law") and art.271 of the Swiss Penal Code. In support of the request, the solicitors referred to the evidence of Dr Schurmann filed in the proceedings. The letter noted that the information sought in relation to 80,000 shares beneficially owned by Leumi, had already been provided to the ASC. On 13 October 1995, the delegate of the ASC, Mr Goldie, refused the request. That refusal is not in issue in the present proceedings. Leumi's Application to the Administrative Appeals Tribunal On 16 October 1995, Leumi applied to the Administrative Appeals Tribunal ("AAT") for review of Mr Goldie's decision of 13 October 1995. On 3 November 1995, Leumi applied to the AAT under s.29(7) of the Administrative Appeals Tribunal Act 1975 (Cth) for an extension of time to make an application to challenge Mr Goldie's decision of 5 September 1995 to refuse relief under s.721(1) of the Corporations Law. Leumi's applications have not yet been determined by the AAT. Secondary Notice to EBC On 18 April 1995, the ASC prepared a secondary notice, addressed to EBC at its address in Switzerland. The covering letter was in the same terms as that to Leumi, the terms of which are set out earlier in this judgment. The notice itself followed Form 609 and, except for the details of the voting shares held by EBC, was identical to the notice sent to Leumi. The notice did not include a reference to the 162,437 shares in OAP held by BB Nominees on behalf of EBC. The notice was signed by Mr Dumas, as the delegate of the ASC. On 20 April 1995, at 4.41 p.m., Australian Eastern Standard time, Mr Blackwell of the ASC faxed the covering letter and the secondary notice to EBC at its fax number in Zurich. On the same day, Mr Blackwell sent the secondary notice and the covering letter to EBC at its Zurich address by international courier. The notice and letter were duly delivered to EBC's offices in Zurich on 24 April 1995. On 20 April 1995, the ASC issued a second notice relating to the parcel held by BB Nominees. The covering letter and the notice were, in substance, in the same form as the first notice. The documents were forwarded by the ASC to Switzerland by international courier and were delivered to EBC's officer in Switzerland on 24 April 1995. The covering letter and the notice were also faxed to EBC in Switzerland at 11.41 a.m. Australian Eastern Standard Time on 26 April 1995. EBC's Responses On 21 April 1995, EBC sent a fax to the ASC, as follows: "We acknowledge the receipt of your fax of 20 April 1995. Due to Swiss secrecy regulations we cannot, however, provide the requested details about the ownership of subject shares." On 26 April 1995, the ASC responded to EBC's fax. The ASC's response stated, as it had in its letter to Leumi, that it did not accept that "Swiss Secrecy Regulations" were sufficient reason not to comply with the secondary notice. The ASC advised that unless a satisfactory response was received by 28 April 1995, the ASC intended to apply to the Federal Court to enforce compliance. On 28 April 1995, EBC faxed the ASC to advise that Mr Fundulus, who was handling the matter, was away and would respond shortly to the ASC's fax of 26 April 1995. On 3 May 1995 Mr Fundulus faxed the ASC to advise that "we are contacting clients from all around the world to get instructions and require another fourteen days to get back to you". On 11 May 1995, EBC's Australian solicitors held a meeting with the ASC. On that date the solicitors advised the ASC that EBC was prepared to consent to an order that the relevant shares be sold on terms acceptable to the ASC. Since EBC maintained that it was a bare trustee in relation to the shares, I infer (as Mr Conti accepted that I should) that EBC made this offer on instructions from the beneficial holders of the shares. A similar open offer was made by EBC on 13 June 1995. It was common ground that EBC has not provided the ASC with the information sought in the secondary notices. The ASC's Decision in Relation to EBC The ASC's position was and is that EBC's fax of 21 April 1995 did not constitute a request by EBC pursuant to s.721(1) of the Corporations Law, that it should not be required to give the requested information to the ASC. However, the ASC took an approach to EBC's letter similar to that which it took in relation to Leumi's faxed letter of 27 April 1995. Mr Goldie was asked to make a decision under s.721, on the unadmitted assumption that the faxed letter of 21 April 1995 constituted a request for the purpose of s.721(1) of the Corporations Law. On 22 June 1995, after the commencement of these proceedings, the ASC wrote to EBC's Australian solicitors, inviting them to identify any request made pursuant to s.721(1) of the Corporations Law, and to make any submissions that it alleged should be taken into account by the ASC in making a decision in any such request. On 27 June 1995, the solicitors responded by identifying the letter of 21 April 1995 as the request. The solicitors made the following submissions: "(iv)The provisions of the Swiss Secrecy Regulations and in particular Articles 271 and 273 of the Swiss Penal Code, that our client would breach these provisions if it were to comply with the secondary notices and accordingly ought not to be required to provide the information sought by the secondary notices." On 4 July 1995, the ASC sought further details from EBC's solicitors of the provisions of Swiss law relied on by them in seeking exemptions from the ASC. The letter also asked whether EBC had advised the persons on whose behalf EBC held the shares specified in the notices and whether EBC had requested their consent to compliance with the notices. There appears to have been no response to this letter. Mr Goldie gave his decision in writing, refusing the request, on 5 September 1995. His reasons were, in substance, the same as those given by him in relation to the (assumed) request by Leumi. On 6 September 1995, the ASC notified EBC of Mr Goldie's decision. The Take-Over Offers Since these proceedings were commenced, a series of unconditional offers has been made for the shares in OAP. On 13 October 1995 Fobiti lodged a Part C Statement with the Australian Stock Exchange in relation to all ordinary shares in OAP. Fobiti, which is a wholly owned subsidiary of Kalamazoo Holdings Ltd, offered the sum of $2.30 per share cum dividend, or $2.215 per share ex dividend. The Part C Statement recorded that, immediately before the announcement of the offer, Fobiti held 1.29% of the OAP shares on issue. The offer was said to be open until 29 November 1995, unless extended. The directors of OAP recommended acceptance of this offer and indicated that, in the absence of a higher bid, they intended to accept the offer for their own shareholdings. On 14 November 1995 Arklow, a subsidiary of The Independent Print Media Group Pty Ltd, lodged a Part C Statement in relation to all ordinary shares in OAP. Arklow offered the sum of $2.40 per share ex dividend. At the date of the announcement of Arklow's offer, it was entitled to 1.6% of the issued capital in OAP. The offer was expressed to be open until 28 December 1995, unless extended. The directors of OAP have now recommended acceptance of this offer, in the absence of any higher bid. On 17 November 1995 Fobiti increased its offer to $2.60 per share ex dividend and extended the offer until 29 December 1995. IIITHE LEGISLATION Information as to Beneficial Ownership: Part 6.8 Part 6.8 of the Corporations Law sets out procedures designed to enable the ASC, or a listed company, to ascertain details of beneficial shareholdings in the company. Section 718(1) allows the ASC to "give to the holder of particular voting shares in a company a primary notice in relation to those shares". A company may also issue its own primary notice: s.718(4). A primary notice is one addressed to the holder of the shares requiring the holder to give a written statement setting out, inter alia, so far as is known to the holder, full particulars of every other person having a "relevant interest" in the shares and the circumstances because of which that person has the interest: s.717. I refer in more detail to the concept of "relevant interest" when dealing with the substantial shareholder provisions, contained in Part 6.7 of the Corporations Law. Section 719(1) provides for the ASC to give a secondary notice: "719(1) Where the Commission receives, pursuant to a primary notice or secondary notice given to a person in relation to particular shares in a company, information that: (a) another person has a relevant interest in any of the shares; or (b) another person has given relevant instructions in relation to any of the shares; the Commission: ... (d) otherwise; may give to the other person a secondary notice in relation to the first-mentioned shares." A secondary notice is defined in s.717 as follows: "'secondary notice', in relation to shares in a company, means a written notice addressed to a person requiring the person to give to the body giving the notice a written statement setting out: (a) full particulars of any relevant interest that the person has in any of the shares and of the circumstances because of which the person has that interest; and (b) so far as is known to the person: (i) full particulars of the name and address of every other person (if any) who has a relevant interest in any of the shares; (ii)full particulars of each such interest, and of the circumstances because of which the other person has that interest; and (iii)full particulars of the name and address of each person (if any) who has given to the person to whom the notice is addressed relevant instructions in relation to any of the shares and of those relevant instructions, and the date on which those relevant instructions were given." "Relevant Instructions", in relation to shares, is defined by s.717 to mean: "instructions or directions: (a) in relation to the acquisition or disposal of the shares; (b) in relation to the exercise of any voting or other rights attached to the shares; or (c) in connection with any other matter relating to the shares;" The ASC is empowered to provide information received pursuant to a primary or secondary notice to the company whose shares are the subject of the notice: s.720. Section 721 was the subject of argument in the present case. It provides as follows: "721(1) A person who receives a primary notice or secondary notice in relation to shares in a company may, before the end of 2 business days after the day on which the notice was received, lodge a written request that, for special reasons set out in the request: (a) the information should not be given to the body that gave the notice; (b) if the Commission gave the notice - the information, if given to the Commission, should not be provided under section 720, or should be so provided only in a particular form; or (c) if the company gave the notice - the information should only be given to the company in a particular form. (2) Where the Commission is satisfied that there are special reasons why: (a) particular information should not be given to the body that gave the notice; ... the Commission may give to the person a certificate referring to the information and stating that: ..." If the ASC refuses the request, the person making it must comply with the notice within two business days of being notified of the refusal: s.723(b). The duty of the person receiving a notice is dealt with in s.722: "722(1) A person who receives a primary notice or secondary notice in relation to shares in a company shall, unless before the end of 2 business days after the day on which the person receives the notice the person lodges a request under subsection 721(1) in relation to particular information that the notice requires the person to give, comply with the notice before the end of 2 business days after that day." Where a person has contravened ss.722 or 723 in relation to a notice given to the person under ss.718 or 719, s.742(2) applies. Section 742(2) provides that, on the application of the ASC (among others): "the Court may make in relation to any of the shares such order or orders as it thinks just, including, but without limiting the generality of the foregoing: (d) a remedial order; and (e) for the purpose of securing compliance with any other order made under this subsection, an order directing the company or any other person to do or refrain from doing a specified act." Section 613 provides that a "remedial order", in relation to the Court, is a reference to any one or more of the following orders: "(a)an order restraining the exercise of any voting or other rights attached to shares; (b)an order directing a body corporate not to make payment, or to defer making payment, of any amount or amounts due from the body corporate in respect of shares; (c)an order restraining the acquisition or disposal of, or of an interest in, shares; (d)an order directing the disposal of, or of an interest in shares; (e)an order vesting in the Commission shares or an interest in shares; (f)an order directing a body corporate not to register the transfer or transmission of shares; (g)an order that an exercise of the voting or other rights attached to shares be disregarded; ...". The powers of the Court under a "relevant provision" (including ss.741 and 742), are further dealt with in s.744(7) and (8). Those sub-sections provide as follows: "(7) Without limiting the nature of the orders that may be made by the Court under a relevant provision directing the disposal of, or of an interest in, shares in a company, such an order may include one or more of the following provisions: (a) a provision that the disposal shall be made within such time and subject to such conditions (if any) as the Court thinks just, including, if the Court thinks fit, a condition that the disposal shall not be made to a particular person or persons or to a particular class or classes of persons; ... (8) The Court may direct that, where a share or an interest in a share is not disposed of in accordance with an order of the Court under a relevant provision, the share or interest shall vest in the Commission." Where a share vests in the ASC by an order under a relevant provision or a direction under s.744(8), the ASC may, subject to any directions of the Court, get in, sell or otherwise dispose of, or deal with, the share as it sees fit: s.744(9) (a). Substantial Shareholdings Provisions: Part 6.7 The substantial shareholdings provisions are contained in Part 6.7 of the Corporations Law. A person who is a "substantial shareholder" in a company, including a company listed on a stock exchange, is required to give a written notice to the company in the prescribed form: ss.603, 709(1). A person is a substantial shareholder, relevantly, if the person is entitled to not less than 5% of the voting shares in the company: s.708(1),(4),(5). The notice must be given before the end of two business days after the day on which the person becomes aware of "the relevant interest or interests because of which the person is a substantial shareholder": s.709(4). The notice must state, inter alia, the prescribed particulars of the voting shares in the company in which the substantial shareholder or an "associate" of that person has a relevant interest or relevant interests: s.709(3)(b). A person is entitled to shares in a body corporate if that person has a "relevant interest" in the shares: s.609(1)(a). The person is also entitled to shares if a person who is an "associate" of the first-mentioned person has a relevant interest in the shares: s.609(1)(b). The "basic rule" is that a person who has power to vote in respect of a voting share, or who has power to dispose of a share, has a relevant interest in that share: s.31; see also s.30(2),(3). A relevant interest in a share is disregarded if the share is subject to a trust and the person has the relevant interest as a bare trustee: s.39(b). A reference to an "associate" of a person includes (i) a person in concert with whom the primary person is proposing to act; or (ii)with whom the primary person is, or proposes to become, associated in any other way, in respect of the matter to which the associate reference relates: s.15(1). However, s.16(1) provides that a person is not an associate of another by virtue of s.15(1) merely because: "(a)one gives advice to the other, or acts on the other's behalf, in the proper performance of the functions attaching to a professional capacity or a business relationship; (b) one, a client, gives specific instructions to the other, whose ordinary business includes dealing in securities, to acquire shares on the client's behalf in the ordinary course of that business; ...". If a person who is already a substantial shareholder increases or reduces the shareholding in a particular class by more than 1% of the shares in that class, a further notice must be given to the company within two days of the person becoming aware of the change: s.710(1)(c),(4). A person who ceases to become a substantial shareholder must also give a notice to the company: s.711(1),(4). Where a substantial shareholder contravenes ss.709, 710 or 711, s.741(1) provides that the Court, on the application of the ASC or the company, whether or not the contravention continues, "may make such order or orders as it thinks just, including (without limiting the generality of the foregoing): (a) a remedial order; and (b) for the purpose of securing compliance with any other order made under this section, an order directing the company or any other person to do or refrain from doing a specified act." "Remedial order" has the meaning given by s.613, to which reference has already been made. Power to Excuse Contraventions Section 743 confers power on the Court to excuse contraventions. "743(1) Where a person has contravened a provision of this Chapter and, on application by any interested person, the Court is satisfied that, in all the circumstances the contravention ought to be excused, the Court may make an order declaring any act, document or matter not to be invalid because of the contravention and to have effect, and at all times to have had effect, as if there had been no such contravention. (2) If the Court is satisfied that in all the circumstances a contravention of section...709, 710, 711, 722 or 723 ought to be excused, the Court shall not make an order under section...741 or 742, as the case may be, other than: (a) an order restraining the exercise of voting or other rights attached to shares; or (b) an order that an exercise of voting or other rights attached to shares be disregarded. (3) The circumstances to which the Court may have regard in deciding whether or not a contravention of a provision by a person ought to be excused include the contravention having been due to the person's inadvertence or mistake, to the person not having been aware of a relevant fact or occurrence or to circumstances beyond the control of the person. (4) This section applies notwithstanding anything contained in any other provision of this Chapter." The Court is not to make an order under ss.741, 742 or 743 "if it is satisfied that the order would unfairly prejudice any person": s.744(2). Extraterritorial Operation of the Corporations Law Section 110D of the Corporations Law provides for the extraterritorial operation of some Chapters, including Chapter 6. "110D Chapters 1 to 6, inclusive, and 9, apply, according to their tenor, in relation to: (a) natural persons, whether resident in this jurisdiction or in Australia or not and whether Australian citizens or not; and (b) all bodies corporate and unincorporated bodies, whether formed or carrying on business in this jurisdiction or in Australia or not; and (c) acts and omissions outside this jurisdiction, whether in Australia or not." Service of Notices Section 719(1), the terms of which were set out earlier, provides for the ASC to "give...a secondary notice in relation to shares". The service of documents is further addressed in ss.109X and 109Y of the Corporations Law. Both are within Chapter 1 of the Law and are therefore to be applied in accordance with s.110D. The sections are as follows: "109X(1) For the purpose of any provision of this Law that requires or permits a document to be served on a person, whether the expression "serve", "give" or "send" or any other expression is used, the document may be served: (a) ... (b) on a body corporate other than: (i) a company; or (ii) a recognised company; or (iii) a registered body; by leaving it at, or sending it by post to, the head office, a registered office or a principal office of the body corporate. (2) Nothing in subsection (1): (a) affects the operation of any other provision of this Law or any other law of the Commonwealth or of this or another jurisdiction that authorises the service of a document otherwise than as provided in that subsection; or (b) affects the power of a court to authorise service of a document otherwise than as provided in that subsection. 109Y Where a provision of this Law authorises or requires any document to be served by post, whether the expression "serve" or the expression "give" or "send" or any other expression is used, then: (a) the service is taken to be effected by properly addressing and posting (under pre-paid post) the document as a letter to the last known address of the person to be served; and (b) unless the contrary is proved, the service is taken to have been effected at the time at which the letter would have been delivered in the ordinary course of post." The definition section (s.9), defines the terms "body corporate", "company", "recognised company" and "registered body", all of which are used in s.109X(1)(b). The result is that s.109X(1)(b) applies to a corporation incorporated outside Australia and which is not registered (pursuant to Part 4.1, Div.2 of the Corporations Law) as a foreign company carrying on business in Australia. IV THE ISSUES The parties raised a very large number of issues. These can be summarised in the following list of questions: l Were Leumi and EBC obliged to comply with the secondary notices, having regard to the secrecy provisions of Swiss law? l Was service of the secondary notices on Leumi and EBC in Switzerland authorised by the Corporations Law, having regard to the provisions of Swiss law governing service of documents in Switzerland? l Was service of the secondary notices by fax authorised by the Corporations Law? l Were the secondary notices invalid by reason of any pre-judgment of issues by the ASC? l Did the ASC fail to consider properly requests made by Leumi and EBC under s.721 of the Corporations Law? l Did Leumi and/or EBC contravene the substantial shareholder provisions of the Corporations Law? l Should Leumi and/or EBC be excused from any contra-ventions, by reason of s.743 of the Corporations Law? l Assuming Leumi and EBC have contravened the Corporations Law, what relief should be granted to the ASC? Some of these questions, in particular the first two, depend to some extent on findings as to Swiss law. Accordingly, I shall deal at the outset with the expert evidence relating to Swiss law. I shall then turn to each of the questions identified above. V THE EXPERT EVIDENCE The Expert Witnesses The general principle, prior to the introduction of the Evidence Act 1995 (Cth), was that foreign law could be provided only by the evidence of appropriately qualified experts: P.E. Nygh, Conflict of Laws in Australia (6th ed. 1995), 269. This principle has been qualified by ss.174 and 175 of the Evidence Act 1995. Section 174 permits evidence of the statutes, proclamations, treaties or acts of state of a foreign country to be adduced by producing official publications or other reliable sources of information. Section 175(1) permits evidence of unwritten or common law to be adduced by producing books which contain reports of court judgments (if that book would be used in the country itself). Section 175(2) allows evidence of the interpretation of statutes to be adduced by producing similar materials. In the present case, the ASC, Leumi and EBC each adduced evidence, in the form of affidavits and reports, from experts in Swiss law. None of the experts was cross-examined. To the extent that there are differences in their views, it is necessary to resolve them by assessing the comparative qualifications and experience of the experts and by considering their reasoning in the light of the materials on which they relied. Mr Lindsay read affidavits and reports prepared by Mr Wehrli, a lawyer practising in a private firm in Geneva. Mr Wehrli has comparatively limited experience, having been admitted to the Geneva bar in 1988 and having earned an LL.M. in international banking in 1990 from Boston University. Mr Wehrli's areas of expertise include criminal and banking law, as well as "international mutual assistance". Mr White relied on affidavits and reports from Dr Schurmann, a senior partner in a Zurich firm of lawyers. Dr Schurmann became a member of the Zurich bar in 1972, after obtaining a Ph.D. in law. His areas of expertise include corporate and banking law and he is a member of a number of professional associations. Dr Schurmann clearly has extensive experience in the practice of banking law in Switzerland. Mr Conti read affidavits and reports prepared by Dr Nobel, a Professor of Civil, Trade and Commercial law at the University of St Gallen, Switzerland. Dr Nobel received a doctorate for a thesis in law in 1974. He has sat as a substitute judge of the Superior Court and the Court of Commerce of the Canton of Zurich over a period of ten years. Dr Nobel has taught at a number of Universities and published widely in the field of Swiss Banking and Finance Law. Dr Nobel's qualifications are impressive, and he, too, has considerable experience as a commentator and judge in the field of Swiss banking law. In my view, Dr Schurmann and Dr Nobel have rather more impressive qualifications and greater experience in banking law than does Mr Wehrli. This factor cannot be conclusive in resolving any conflict in their evidence; plainly it is necessary to assess the reasoning process and the materials relied upon by each expert. In this respect it will be seen that I have not found Dr Schurmann's evidence to be especially helpful on some aspects of Swiss law. However, some weight should be attached to the respective qualifications and experience of the experts. Swiss Law All experts agreed that the provisions of Swiss law relevant to the present proceedings were arts. 271 and 273 of the Swiss Penal Code and art.47 of the Swiss Banking Law. An English translation of these provisions as provided by Mr Wehrli, is as follows: "Article 271 of the Swiss Penal Code 1. Any person who, without authorization, carries out, on Swiss territory, actions which fall within the province of the public authorities, [and] any person who carries out such acts for a foreign State, individual, or organisation, [and] any person who sanctions such acts, shall be punished by imprisonment or, in serious cases, reclusion. 2. Any person who uses violence, deception or threats to force a person onto foreign territory in order to deliver said person to a foreign authority, individual or organisation, or to put said person's life or bodily integrity in danger, shall be punished by reclusion. 3. Any person who provides for such a delivery shall be punished by reclusion or imprisonment." "Article 273 of the Swiss Penal Code Any person who tries to discover a manufacturing or business secret in order to give it to a foreign government or individual, or to a foreign company, or to the agents of any of the above, [and] any person who gives a manufacturing or business secret to a foreign government or individual, or to a foreign company, or to the agents of any of the above, shall be punished by imprisonment or, in serious cases, by reclusion. The judge may also demand payment of a fine." "Article 47 of the Swiss Federal Law on Banks and Savings Banks 1. Whoever divulges a secret entrusted to him or of which he has become aware in his capacity as officer, employee, mandatory, liquidator or commissioner of a bank, as representative of the Banking Commission, officer or employee of a recognised auditing company and whoever tries to induce others to violate professional secrecy, shall be punished by imprisonment for not more than six months or by a fin[e] of not more than CHF50,000. 2. If the act has been committed by negligence, the penalty shall be a fine not exceeding CHF30,000. 3. The violation of professional secrecy remains punishable even after termination of the official or employment relationship or the exercise of the profession. 4. Federal and cantonal regulations concerning the obligation to testify and to furnish information to a government authority shall apply." Dr Nobel stated that, in ordinary cases, the maximum penalty for breach of arts. 271 and 273 was three years' imprisonment. However, he expressed the view that it was unlikely that such a term would ever be imposed, although other consequences, such as loss of a dealer's licence, could follow for a person convicted. Article 273 Dr Schurmann attached to one of his reports a memorandum prepared by the Office of the General Attorney of Switzerland in 1986. That memorandum identified several goals pursued by art.273 of the Swiss Penal Code. "It is designed, first of all, to protect Switzerland from infringements upon its sovereignty resulting from direct gathering of information or from denounciations [sic.] to a foreign addressee on the one hand, and from disclosures of information compelled by foreign authorities, on the other. Furthermore, it is designed to protect the Swiss economy, which is affected as such whenever persons or companies falling under the jurisdictional scope of Article 273 are the object of such inquiries. The Swiss Supreme Court has repeatedly emphasised that violating or endangering private business secrets also impairs the interests of the Swiss economy. Thus, the protection of the economic interests of companies affected constitutes indirectly also one of the basic aims of this penal norm. Where extensive information is sought by foreign courts or administrative bodies outside of the established framework of judicial assistance pursuant to international treaties and Swiss law, the disclosure sought may well conflict with the purposes of Article 273." The memorandum also states that the interests of foreigners are protected by art. 273 against disclosure only if they are so intertwined with the interests of Switzerland as to be "inseparable". On this basis, Mr Wehrli expressed the view that if the shares in OAP held by Leumi and EBC were held on behalf of persons domiciled outside Switzerland (as he thought was likely to be the case), the interests of those persons would not have sufficient contact with Switzerland to attract the operation of art.273 in the event of an unauthorised disclosure. In his view, the mere fact of having a banking or business relationship with a Swiss bank or company is generally not considered to create a sufficient link with Switzerland to affect Swiss sovereign interests in the Swiss economy. Accordingly, although Mr Wehrli accepted that the Swiss courts and authorities had taken a broad view of the phrase "business secret", he did not think that art.273 would protect the interests of non-Swiss domiciliaries for whom Swiss corporations held shares in an Australian company. By implication, as I read his evidence, Mr Wehrli accepted that, if the Swiss corporations held shares in an Australian company on behalf of a party domiciled in Switzerland, there could be sufficient connection with Switzerland to attract art.273. In these circumstances, a disclosure of the Swiss domiciliary's beneficial interest, without the authorisation of the domiciliary, would breach art.273. Dr Schurmann's opinion was that a Swiss bank (and presumably a non-bank Swiss corporation) "may be found to violate" art.273 if it surrenders substantial information regarding its customers to foreign authorities, without a formal request for assistance being made to Swiss authorities. However, this conclusion was not justified by a substantial process of reasoning, and I have not found it particularly helpful. Dr Nobel expressed the opinion that there is a sufficient connection with Switzerland, for the purposes of art.273, if a disclosure of a business secret affects an owner of the secret who is domiciled in Switzerland. If the owner is not so domiciled, the question is whether the owner of the secret is regarded by Swiss law as having a "legitimate interest" in maintaining its secrecy. Dr Nobel considered that the question was not certain, because Swiss courts had not ruled on the situation and the information sought by the notices was directed to "private economic interests" in a company incorporated outside Switzerland. Dr Nobel observed that art.273 "was implemented to protect manufacturing or business secrets which, in the national economic interest of Switzerland require protection". However, he thought that there was a "risk", because of the uncertainty, that EBC would breach art.273 if it supplied the information sought by the notices without the consent of clients. In his second report, Dr Nobel was more definite in his opinion. He expressed the view that there is a "real and appreciable risk of liability" for EBC's officers, employees and agents, should EBC comply with the notices. He supported this conclusion by referring to the works of legal scholars, who have argued that art.273 is attracted if a secret is physically "materialised" in Switzerland. Dr Nobel expressed the view that, if a corporation like EBC holds foreign shares for foreign domiciliaries, the secret is "materialised" in Switzerland. Unfortunately, the authorities referred to by Dr Nobel (mostly in German or French) were not adduced in evidence, so that it is difficult to assess whether his characterisation of EBC's arrangements is supported by the literature. It is also relevant that Dr Nobel stressed the importance to a Swiss corporation of not giving any reason for suspicion that the criminal law might have been violated. Dr Nobel pointed out that media reports could be very harmful. This reasoning rather suggests a concern, not so much with the likelihood of a successful prosecution, but with the harmful effects of an investigation, whatever its outcome. I accept Dr Nobel's evidence that, if EBC provides to the ASC the information sought in the secondary notices, there is "real and appreciable risk" that a Swiss court would find that art.273 applies to EBC's officers, employees and agents, at least where EBC holds the shares in OAP for a Swiss domiciliary. I also accept that there is also a small risk that a Swiss court would find that art.273 applies to a disclosure by EBC without the consent of its clients, where EBC holds the shares in OAP for non-Swiss domiciliaries. However, having regard to the views expressed by Mr Wehrli and to Dr Nobel's reasoning, I think that that risk is significantly less than where the beneficial owner of the shares is a Swiss domiciliary. I do not accept that it is accurately described as a "real and appreciable" risk. The experts did not suggest that Leumi's circumstances are materially different from those of EBC, so far as the application of art.273 is concerned. Accordingly, I find that Leumi's position in relation to art.273 is the same as EBC's. All the experts agreed that a Swiss corporation, and its officers, employees and agents would not be exposed to liability under art.273 if the client consented to or authorised disclosure of the information. I accept this evidence. Article 271 Mr Wehrli acknowledged that the purpose of art.271 of the Swiss Penal Code is to protect Swiss sovereignty and that the service of process is an act of State that can be executed in Switzerland only by a Swiss authority. However, in his view, art.271 does not apply to the service of notices which do not include any threat of sanction. Mr Wehrli observed that the secondary notices issued by the ASC did not contain an explicit threat of sanctions. Although Mr Wehrli did not say so expressly, I infer that his view is that service of the notices on Leumi or EBC, whether by fax or courier, did not violate art.271. Dr Schurmann considered the applicability of art.271 only in relation to the service of a notice to answer interrogatories, where the notice is issued in the course of Australian proceedings. (A question relating to interrogatories arose at one stage in these proceedings but is no longer relevant.) I do not think that Dr Schurmann's observations on this issue can be readily applied to the secondary notices. Dr Nobel, in his first report, expressed the view that art.271 extends to the act of serving documents in order to enforce a law. Moreover, a foreign regulatory authority which sends a notice requiring information to a Swiss corporation commits an act for which a "public authority is competent", within the meaning of art.271. Accordingly, in his view, the employees or agents of the ASC who sent the secondary notices to Switzerland by fax or courier, had breached art.271. He also considered that any officers, employees and agents of EBC who provided information to the ASC in answer to the notices illegally served "could be held in breach of [art.271] as aiders and abetters" of the breach by the ASC's employees and agents. Dr Nobel pointed out that Swiss courts had adopted a broad interpretation of aiding and abetting, although he acknowledged that the matter had not been considered by the Swiss courts in the context of persons answering notices of the kind involved in the present case. In his second report, Dr Nobel expressly disagreed with Mr Wehrli's view that the secondary notices would not be regarded as having a legal effect on the recipients. Dr Nobel's view was that any kind of legal effect, including those imposed by Australian law, would be enough. On the question of whether the notices contain a threat of sanctions, I think that Dr Nobel's analysis is more convincing than that of Mr Wehrli. I think, however, that there is a real question as to whether persons sending a fax transmission ("fax") from Australia to Switzerland "[carry] out, on Swiss territory, actions which fall within the province of the public authorities", within the meaning of art.271. Neither Dr Nobel nor Mr Wehrli specifically addressed this issue, although Mr Wehrli did not appear to disagree with the proposition that the sending of a fax was within art.271. However, this may well be because his attention was not directed to the issue. I find that service of the secondary notices on Leumi and EBC by courier in Switzerland was likely to have breached art.271 of the Swiss Penal Code. Doing the best I can with the material available to me, I find that there was a risk that service of the secondary notices on the Swiss corporations, by means of faxes sent from Australia to Switzerland, breached art.271. However, the risk of a prosecution succeeding under Swiss law in such circumstances is significantly less than in the case of service of documents effected in Switzerland by courier. I also find that there is some risk that Leumi and EBC, and their officers and agents, would contravene art.271, as aiders and abetters of any breaches of art.271 by the ASC and its agents, if Leumi and EBC complied with the secondary notices. However, it is necessary to have regard to the lack of authoritative guidance on this issue under Swiss law and the rather general character of Dr Nobel's reasoning on this point. I think that the risk of a prosecution based on aiding and abetting, although not fanciful, cannot be described as real and appreciable. If the disclosure to the ASC were made with the authority of the clients of Leumi and EBC, I think that the risk of prosecution of the Swiss corporations, or their servants or agents, as aiding and abetting any contravention by the ASC of art.271, is not appreciable. Article 47 of the Banking Law Article 47 of the Swiss Banking Law applies only to Leumi, since EBC is not a bank. The only evidence on the application of art.47 was given by Dr Schurmann and Mr Wehrli. As I read their evidence, there was no substantial disagreement between them on the scope of art.47. The following emerges from their evidence. Article 47 was primarily enacted to protect the private interest of investors and other clients, as well as the interests of a sound and efficient financial market. It applies to all Swiss banks, as well as branches of foreign banks in Switzerland. Article 47 applies regardless of the domicile of customers. Article 47 does not prevent a Swiss bank from seeking or obtaining the consent of persons to whose behalf they hold shares to divulge information of the kind sought in the secondary notices. Nor does it prevent the person on whose behalf the shares are held from instructing the bank to comply with the notices. However, under Swiss law, there is no obligation on the bank to seek the customer's approval for the disclosure of information. If the bank does not receive consent to the information being divulged to a foreign regulatory authority it would be a breach of art.47 for the bank to divulge the information. Mr Wehrli and Dr Nobel disagreed as to whether Swiss banks follow a practice of requesting customers in advance for a waiver to permit answers to be given to questions raised by foreign regulators. On the evidence I cannot find that there is any such general practice. VI.WERE LEUMI AND EBC OBLIGED TO COMPLY WITH THE SECONDARY NOTICES, NOTWITHSTANDING THAT COMPLIANCE PLACED THEM AT RISK OF VIOLATING SWISS LAW? Background Leumi and EBC argued that they were not obliged to comply with the secondary notices issued by the ASC, since compliance would expose them to the risk of contravening the secrecy provisions contained in art.273 of the Swiss Penal Code and art.47 of the Swiss Banking Law. This argument was based on the proposition that s.722 of the Corporations Law, which imposes a duty on a person receiving a secondary notice to comply with that notice within two business days, was not intended to apply to a foreign corporation which can comply with the secondary notice only at the risk of contravening the law of a friendly foreign country. Leumi and EBC also submitted that service of the secondary notices on them, whether by fax or by courier, was not authorised by s.719 of the Corporations Law. This was because giving the notice in this fashion (so it was said) contravened art.271 of the Swiss Penal Code and s.719 did not contemplate that the ASC could serve a notice on a foreign corporation in breach of foreign law. These issues are interconnected, since they each depend on the construction of Part 6.8 of the Corporations Law, having regard to principles of international comity. It is, however, convenient to commence with the argument that Leumi and EBC were not obliged to comply with the secondary notices because they would be at risk of contravening Swiss law. In putting this argument, both Leumi and EBC commenced with the proposition that disclosure of the information sought in the secondary notices would infringe Swiss law. The findings I have made suggest that the position is not quite as clear-cut as this. A distinction must be drawn, so far as art.273 of the Swiss Penal Code is concerned, between customers of Leumi and EBC who are Swiss domiciliaries and those who are not. Moreover, art.47 of the Swiss Banking Law applies only to Leumi and not EBC. I shall deal with the argument on this issue on the assumption that disclosure of the information sought in the secondary notices would place Leumi and EBC at a real and appreciable risk of contravening Swiss law. Principles of Construction The approach to the construction of legislation said to breach international law or principles of international comity was not in dispute between the parties. As Latham C.J. said in Polites v The Commonwealth (1945) 70 CLR 60, at 69: "every effort should be made to construe Commonwealth statutes so as to avoid breaches of international law and of international comity." See, also, at 77, per Dixon J., at 80-81, per Williams J.; Minister for Immigration and Ethnic Affairs v Teoh (1995) 69 ALJR 423, at 430, per Mason C.J. and Deane J.; at 447, per McHugh J. However, as the Chief Justice observed in Polites, the Commonwealth Parliament has power to legislate in breach of international law, taking the risk of international complications, if it wishes to do so: Polites, at 61; Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1, at 65, per McHugh J. It was not suggested by any party that these principles did not apply to the Corporations Law which is a law in force in the Australian Capital Territory, and applied to each State by the Corporations Act of each State. Territorial supremacy is an established principle of international law: Oppenheim's International Law, eds. R. Jennings and A. Watts (9th ed, 1992), at 458. Thus, under international law, a sovereign power is bound to respect the subjects and the rights of all other sovereign powers outside its territory: The Queen v Jameson [1896] 2 QB 425, at 430. In accordance with the principle of construction to which I have referred, domestic legislation is generally presumed not to be intended to breach this principle: Meyer Heine Pty Ltd v China Navigation Co Ltd (1965) 115 CLR 10, at 23-24, per Kitto J.; Attorney-General of New Zealand v Ortiz [1984] 1 AC 1, at 19, per Lord Denning MR. However, the presumption is rebuttable and its strength will depend upon the subject matter of the legislation: Air-India v Wiggins [1980] 1 WLR 815 (HL), at 820-821, per Lord Scarman. It follows that the presumption that legislation operates territorially can be rebutted by explicit language stating that the legislation is to have effect in the territory of another country. It can be rebutted, even without explicit language, as illustrated by Re North Broken Hill Holdings Pty Ltd (1986) 10 ACLR 270 (S.Ct. Vic/Fullagar J.), a case concerned with s.261 of the Companies (Vic.) Code 1981, the forerunner to the provisions now contained in Part 6.8 of the Corporations Law. Fullagar J. held that the word "person", as used in s.261, applied to a Swiss corporation, neither registered nor carrying on business in Australia. His Honour considered (at 282) that a more restrictive interpretation would "set at nought" the elaborate statutory machinery established by the Code, which was designed to promote an informed market for shares in public companies. (The decision was reversed by the Full Court, but on other grounds: Crosley Ltd v North Broken Hill Holdings Ltd [1987] VR 119 (S.Ct. Vic/FC).) This case should be compared with Arhill Pty Ltd v General Terminal Co Pty Ltd (1990) 23 NSWLR 545 (NSW S.Ct/Rogers C.J. Comm D), at 550-555. There Rogers C.J. Comm D. refused to read a general rule of court, which permitted service outside the State of documents other than originating process, as authorising service of a subpoena on a Japanese company in Japan. His Honour took into account that service of the subpoenas would infringe Japanese sovereignty. Section 110D of the Corporations Law explicitly states that Chapter 6 applies, according to its terms, to natural persons, whether resident in Australia or not, and whether Australian citizens or not. It also states explicitly that Chapter 6 applies to all bodies corporate, whether formed or carrying on business in Australia or not and to acts and omissions outside Australia. Leumi and EBC acknowledged that the express provisions of s.110D of the Corporations Law rebut the presumption against extra-territorial operation of the legislation. Leumi and EBC nonetheless contended that s.110D is insufficient to rebut the presumption that Australian Parliaments in the interests of international comity, do not intend to create obligations on foreign corporations compliance with which would contravene the law of a friendly state. This presumption is based not merely upon the principles of territorial supremacy, but on the notion that Australian law will not compel the fulfilment of an obligation which requires something to be done which is illegal in another country: De Beeche v The South American Stores (Gath and Chaves) Ltd [1935] AC 148 (HL), at 156, per Viscount Sankey L.C. The principle was applied by the House of Lords, in the context of an action to enforce a contract, in Regazzoni v K.C. Sethia (1944) Ltd [1958] AC 301. In that case, as a matter of comity, the House of Lords declined to enforce a contract, which contemplated that jute bags would be shipped from India to South Africa, in violation of Indian law. Clearly, very considerable caution must be exercised before construing legislation so as to impose duties on foreigners which create a risk that they may be required to contravene foreign law. Ultimately, however, the question is one of ascertaining the intention of the legislature by reference to the language used and the objects of the legislative scheme. Sometimes the issue is specifically addressed in the local legislation. For example, s.5(1) of the Trade Practices Act 1974 (Cth) extends some sections of the Act to conduct outside Australia by bodies corporate carrying on business in Australia. A claim for damages under s.82 of the Act cannot, however, be made by reason of such conduct unless the Minister gives written consent: s.5(3). The Minister must give consent unless, inter alia, "the law of the country in which the conduct concerned was engaged in required or specifically authorised" the conduct: s.5(5)(a). If, however, the legislation does not address the issue specifically the question is whether, having regard to the presumption that legislation should be construed in accordance with principles of international law and comity, there is a sufficiently clear legislative content to impose duties on foreigners, even though compliance may require the foreigner to breach (or be at risk of breaching) foreign law. The point is illustrated by a decision of the Supreme Court of the United States, Societe Internationale Pour Participations Industrielles et Commerciales, SA v Rogers 357 US 197 (1958). A Swiss corporation, Society Internationale, said to be closely associated with the German firm I.G. Farben, brought suit under the Trading with the Enemy Act to recover assets held by the Alien Property Custodian. Society Internationale sought to be relieved from orders for the production of documents, on the ground that disclosure of the required bank records would violate Swiss law. Indeed the Swiss Federal Attorney, taking the view that disclosure would violate art.273 of the Swiss Penal Code and art.47 of the Swiss Banking Law, confiscated the records. Harlan J., for the Court, held that the policies underlying the Trading with the Enemy Act justified the production order. In particular, the need to allow the US Government the opportunity to establish links between a claimant and enemy aliens supported the making of the order. To hold that the fear of punishment meant that Societe Internationale did not have "control" of the documents, would undermine Congressional policies and "invite efforts to place ownership of American assets in persons or firms whose sovereign assumes secrecy of records" (at 205). Societe Internationale v Rogers has been regarded in the United States as establishing that the "blocking statute" of another country does not deprive an American court of the power to order a party subject to its jurisdiction to produce evidence, even though the act of production may violate the blocking statute: Societe Nationale Industrielle Aerospatiale v United States District Court for the Southern District of Iowa, 482 US 522 (1987), at 544, n.29. Part 6.8 of the Corporations Law In determining whether a foreign corporation must comply with s.722 of the Corporations Law, even if compliance involves a breach or risk of a breach of foreign law, it is necessary to consider the legislative scheme of which s.722 is but one component. Section 722, of itself, is equivocal. It simply imposes a duty to supply information on persons who "receive" secondary notices. But s.722 must be read with s.110D. This section provides that Chapter 6 applies according to its tenor in relation to all bodies corporate, whether or not formed or carrying on business in Australia, and to acts and omissions, whether outside Australia or not. It is true that s.110D does not specifically address the question of compliance by a foreign corporation with a secondary notice where compliance with the notice would contravene foreign law. Nonetheless, s.110D evinces a legislative intend that the Corporations Law should apply to foreign corporations and to acts and omissions outside Australia. If read literally, ss.722 and 110D in combination impose a duty on a foreign corporation to comply with a secondary notice served outside Australia, even if compliance requires the corporation to take steps outside Australia. But the question remains whether Part 6.8 in general and s.722 in particular are intended to apply to foreign corporations, where compliance by them would nor might contravene the secrecy laws of another country. In answering this question assistance is derived from considering the objects of the legislative scheme embodied in Part 6.8. The forerunner to Part 6.8 was s.261 of the Companies Code 1981, which in turn was based on s.27 of the Companies Act 1976 (UK). Section 261 was amended in 1983 and s.261A was inserted into the Code at the same time. Section 261A, which was the predecessor of the current s.742 of the Corporations Law, listed the powers of the court in the event of non-compliance with s.261. (See generally J.J. Hockley, "Beneficial Interests in Company Shares: Proposals for Reform of section 261 and 261A of the Companies Act and Code" (1988) 6 Companies & Securities LJ 27.) The Explanatory Memorandum for the Companies and Securities Legislation (Miscellaneous Amendments) Bill 1983 set out the reasons for requiring disclosure under s.261 (para.371): "Reasons for requiring disclosure. Section 261 forms part of the shareholding disclosure provisions of the [code], and is complementary to the substantial shareholdings disclosure provisions. There are several reasons why it may be important to ascertain the nature, extent and identity of the beneficial interests in the voting shareholdings (that are less than the substantial shareholdings threshold) in a listed public company: (a) Lack of such knowledge may have an unsettling effect on the company and its operation as a result of uncertainty as to the identity and therefore intentions of significant voting shareholders. (b) A party with a total beneficial interest in the voting shares less than 10% [now 5%] of the issued voting shares may be in a position to covertly influence decision making or establish a basis from which to launch a takeover bid, without the company or other shareholders being aware of the situation. (c) Members of the company have a legitimate interest in the control of the company, because the policies of those with influence within the company can significantly affect the value of each share and each shareholding. (d) Disclosure may help identify possible instances of insider trading. (e) Disclosure may act to better inform the public market. As stated by the Company Law Advisory Committee (Eggleston Committee) in its Second Interim Report: "In the case of companies whose shares are traded on stock exchanges, shareholders are entitled to know whether there are in existence substantial holders of shares which might enable a single individual or corporation or small group, to control the destinies of the companies, and if such a situation does exist, to note who are the persons on whose exercise of voting power the future of the company may depend." In Re North Broken Hill, Fullagar J. (at 283) explained the purpose of ss.261 and 261A in these terms: "The object of the legislature was to create and maintain an informed market for public company shares, and it regards the object as so important that it provides for drastic consequences ensuing (in the discretion of the court) upon any blocking of information even for three business days after a request. (In the days of radiotelegraphy and telex machines and internationally-dialled telephones, it is no surprise to find that the short notice applies to all corporations wherever situated, again subject, as regards consequences, to the very wide discretion of the court.)" Earlier in his judgment (at 282), his Honour had said this: "The purpose of the legislation in Div 4 of Pt V of the Code is to promote an informed market for the shares in public companies, and to prevent substantial transactions on an uninformed market. A practical means adopted for effecting this purpose is to compel disclosure of ultimate control of purchased shares by compelling disclosure of all links in the chain between the purchaser on the record and the person who controls the shares purchased, and requiring registration of the facts disclosed. It would be contrary to this apparent purpose, and nothing short of absurd, if the elaborate machinery designed to achieve it could be set at nought by the mere subterfuge of inserting a foreign puppet company between the holder of the share and the citizen who in fact instigated their purchase and controlled them from the moment of purchase." On appeal, the Full Court cast no doubt on those observations. Indeed, the Full Court endorsed (at 136) Fullagar J.'s statement, that "the legislature deliberately chose a small and hair-pressure trigger for what is a very powerful and potentially destructive gun". Fullagar J.'s observations were cited with approval by the Full Court of the Supreme Court of Western Australia in Brunswick NL v Blossomtree Pty Ltd (1992) 7 WAR 226, at 234-235. In my view, if a foreign corporation subject to secrecy laws was not bound to comply with secondary notices issued by the ASC in respect of Australian companies, the scheme of compulsory disclosure created by Part 6.8 is likely to be severely hampered, if not rendered unworkable. In Re North Broken Hill, Fullagar J. remarked on the ease of international communications. Since his Honour made these observations, technological advances have made international communications and transactions even easier. It is a simple matter for any shareholder in an Australian corporation, including an Australian resident, to select as nominee a corporation located in a jurisdiction with stringent commercial secrecy laws. In my opinion, Part 6.8 chooses to address the possible difficulties created by secrecy laws of other countries in a different way than that suggested by Leumi and EBC. The approach taken is to confer a discretion on the ASC and the Court to exempt foreign corporations (among others) from compliance with s.722, or to excuse non-compliance. Section 721 allows a person who has received a secondary notice to lodge a written request that, for special reasons set out in the request, the information required by the notice should not be given. Section 743 empowers the Court to excuse a contravention of any of the provisions, inter alia, of Part 6.8. Sections 721 and 743 do not, of course, necessarily have the effect of relieving a foreign corporation from the obligation imposed by Part 6.8 to comply with a secondary notice duly served upon it, even if compliance would infringe the secrecy laws of the country in which the corporation carries on business. But the sections allow a foreign corporation caught between the conflicting demands of two legal systems to apply to be exempt from compliance with the notices or to be excused for non-compliance. They also allow the ASC and the Court to take account of the particular circumstances of each case. It is both unrealistic and unduly rigid to assume that cases fall into one of two classes: those in which disclosure infringes foreign secrecy laws and those in which it does not. As the evidence in the present case shows, disclosure may involve a risk of prosecution that varies considerably, depending on the certainty or uncertainty of the legal position under foreign law and the attitude of the law enforcement authorities in another country. Similarly, the nature of any dilemma facing a foreign corporation caught between two legal systems can vary. In some cases the dilemma may arise by reason of circumstances completely beyond the corporation's control. In others, the dilemma may have been occasioned by deliberate business practices adopted by the foreign corporation in relation to Australian securities, in full knowledge of the requirements of Australian law. In my view, ss.721 and 743 suggest that Parliament contemplated that questions of the kind raised in the present case should be resolved, not by limiting the reach of Part 6.8 of the Corporations Law, but by use of the flexible mechanisms established by these sections. I think that this conclusion is consistent with the direction in s.109H of the Corporations Law that "[i]n the interpretation of a provision of this Law, a construction that would promote the purpose or object underlying the law (whether that purpose or object is expressly stated in the Law or not) is to be preferred to a construction that would not promote that purpose or object." Enforcement and Prescription Jurisdiction In the course of his detailed and helpful argument, Mr White distinguished between the jurisdiction of a state to enforce its laws and the jurisdiction to prescribe laws. He referred to Federal Trade Commission v Compagnie de Saint-Gobain-Pont-A-Mousson 636 F2d 1300 (1980), in which the Court of Appeals for the District of Columbia pointed out (at 1316) that, although a state's prescriptive jurisdiction is not strictly limited by territorial boundaries, the enforcement jurisdiction by and large continues to be strictly territorial. The prescriptive jurisdiction may be exercised, with respect to conduct outside the United States, if the conduct has "substantial effect" within the United States: Restatement of the Foreign Relations Law of the United States, Third, vol.1, ss.402(1)(c). This is the case, for example, where actions in apparent violation of anti-trust laws take place outside the United States but have effects within that country. The distinction drawn by Mr White is recognised as a matter of international law. However, it does not alter the fact that domestic legislation, as a matter of construction, can authorise the extraterritorial exercise of the enforcement jurisdiction. FTC v Saint-Gobain-Pont itself was concerned with purported service of a subpoena to France by an agency investigating possible anti-trust violations. The subpoena was served by registered mail. The Court held that this mode of service was not authorised by the governing legislation. But the decision was reached because no clear congressional intent could be discerned to authorise a mode of service other than the "customary and legitimate methods of compulsory service commonly employed by American courts" (at 1323). Had such an intent been discerned, a different result would have been reached (at 1315, 1324). The Court was also influenced by the fact that the FTC was attempting to exercise the enforcement jurisdiction of the United States before it had been established that prescriptive jurisdiction was available (at 1317) - that is, before it had been shown that a violation of the anti-trust laws of the United States, having effect in the United States, had taken place. In the present case, the Commonwealth Parliament and the Parliament of New South Wales have prescriptive jurisdiction over shares held in an Australian corporation: Restatement Third, ss.402(1)(b) (the laws with respect to interests in things present within the territory); Williams and Humbert Ltd v W. & H. Trade Marks (Jersey) Ltd [1986] AC 368, at 428, 431; P.E. Nygh, Conflict of Laws in Australia (6th ed. 1995), 488-489. If it is correct to characterise Part 6.8 in general, and s.722 in particular, as an exercise of the enforcement jurisdiction, it is taking place in circumstances where the legislatures enacting the scheme embodied in the Corporations Law do have prescriptive jurisdiction. The circumstances are therefore different from those in issue in FTC v Saint-Gobain-Pont. Attorney-General v Heinemann Mr Lindsay relied on the decision of the High Court in Attorney-General (United Kingdom) v Heinemann Publishers Australia Pty Ltd (1988) 165 CLR 30 ("the Spycatcher Case") to support the ASC's contention that Leumi and EBC were required to comply with the secondary notices notwithstanding that to do so exposed them to a risk of contravening Swiss law. In the Spycatcher Case the High Court held that a foreign State could not enforce in Australia an obligation of confidentiality owed by a member or former member of its security service by restraining publication of a book written by that member. The principal judgment (Mason C.J., Wilson, Deane, Dawson, Toohey and Gaudron JJ.) applied the rule, based partly on "international comity and expediency" (at 41), that prevents (at 43) "enforcement outside the territory of the foreign sovereign of claims based on or related to the exercise of foreign governmental power". Mr Lindsay sought to equate the submission by Leumi and EBC, that they were not bound to comply with the secondary notices, with an attempt to enforce the public laws of Switzerland in Australia. In my view, the Spycatcher Case was concerned with very different issues to those arising in the present case. In this case, the Swiss authorities are not seeking to enforce in Australia any governmental claims. The issue is whether Leumi and EBC can rely on the risk of contravening Swiss law as a reason for not complying with the secondary notices. Those notices were issued in Australia, but served in Switzerland (whether by fax or by courier) and require a Swiss corporation to comply with Australian law. Whether the Swiss corporations are bound by the notices is to be determined by the process of statutory construction to which I have referred. Self-Incrimination Mr Conti relied on an additional argument to support the proposition that the Corporations Law does not require compliance with a secondary notice, where the recipient is a foreign corporation and compliance would contravene foreign law. He contended that nothing in s.719 or (presumably) s.722, was intended to abrogate the privilege against self-incrimination. While he acknowledged that Australian law does not recognise the privilege against self-incrimination for corporations (Environment Protection Authority v Caltex Refinery Co Pty Ltd (1993) 178 CLR 477), the Swiss corporations could act only through natural persons. These persons would be at an appreciable risk of being subjected to criminal sanctions if they assisted EBC (or Leumi) to comply with the secondary notices. Mr Conti contended that the better view is that the privilege extends to self-incrimination under foreign law: see McNicol, Law of Privilege (1992), 215-223; Adsteam Building Industries Pty Ltd v The Queensland Cement and Lime Company Ltd (No.4) [1985] 1 Qd R 127 (S.Ct. Qld/McPherson J.). In the latter case, which was decided before EPA v Caltex, it was held that a Swiss corporation was entitled to claim privilege from producing a class of documents, the contents of which disclosed shareholdings in another Swiss corporation. The privilege from non-disclosure arose because the disclosure would or might expose the party making the disclosure to a penalty under the Swiss Penal Code. Mr Conti's argument raises several difficult questions. First, it is not settled in Australia whether the privilege against self-incrimination protects a person from self-incrimination under foreign law. In Adsteam v Queensland CLC, McPherson J. held that it did, at least in the context of discovery in civil proceedings between subject and subject (at 145). There have been decisions to the contrary (see, for example, In re Atherton [1912] 2 KB 248, at 255-256, per Phillimore J.) and other Australian authorities are inconclusive: Commissioner of Australian Federal Police v Cox (1989) 87 ALR 163 (FCA/Morling J.), at 167; FF Seeley Nominees Pty Ltd v El Ar Initiations (UK) Ltd (1990) 96 ALR 468 (S.Ct. SA/Zelling A.J.), at 471-474. Secondly, it is not entirely clear that the privilege applies where it is the very act of disclosure that constitutes or might constitute an offence under foreign law, as distinct from a disclosure that exposes the person to the risk of prosecution for an antecedent offence. McPherson J. regarded the former situation as covered by the privilege. The modern rationale for the privilege, as stated by Mason C.J. and Toohey J. in EPA v Caltex, at 498, is that it protects "the individual from being confronted by the 'cruel tri-lemma' of punishment for refusal to testify, punishment for truthful testimony or perjury". This formulation is consistent with the privilege applying to a compulsory disclosure which is itself an offence under foreign law, but I do not think that the proposition has yet been clearly established. Thirdly, if the privilege were available in the present case, it would be necessary to consider the effect of the privilege on Leumi and EBC. As I have noted, EBC is not affected by the Swiss Banking Law. Both Leumi and EBC are bound by art.273 of the Swiss Penal Code, but the degree of risk of contravening art.273 varies according to whether the customers are or are not Swiss domiciliaries. There is also some risk, although I consider it slight, that disclosure by Leumi and EBC of the information required by the secondary notices would make them liable as aiders and abetters of any breach by the ASC of art.271. I do not think it is necessary to resolve these issues. The duties imposed by Part 6.8 of the Corporations Law on a corporate shareholder are imposed on the corporation itself. As Mr Conti acknowledged, the privilege against self-incrimination, assuming it applies where the risk of incrimination arises under foreign laws, is not available to a corporation. I have previously held that, as a matter of construction, a foreign corporation is required to comply with a secondary notice received by it, notwithstanding that the compliance creates a risk of the corporation contravening foreign law. I have reached this conclusion largely because the legislative scheme created by Part 6.8 would be severely hampered, and perhaps rendered unworkable, if a foreign corporation were to be exempted from the statutory requirements. In my opinion, the legislative intent underlying the scheme created by Part 6.8 would be equally undermined if a foreign corporation did not have to comply with a secondary notice because compliance would create an appreciable risk of prosecution, under foreign law, for some of the corporation's officers and agents. It is clear that a corporation which is required to make disclosure by Australian law cannot rely on the privilege against self-incrimination to defeat that obligation. In my opinion the fact that disclosure may place some other people at risk of prosecution under foreign law is not sufficient to warrant reading down the duties imposed by Part 6.8 and, in particular s.722, of the Corporations Law. Accordingly, I reject the argument based on the privilege against self-incrimination. VIIWAS SERVICE OF THE SECONDARY NOTICE IN SWITZERLAND AUTHORISED BY THE CORPORATIONS LAW? The Submissions Leumi and EBC submitted that, whatever view was taken of the scope of s.722 of the Corporations Law, s.719 should not be construed so as to permit the ASC to "give" a secondary notice to a Swiss corporation, where the giving of the notice violated or might violate Swiss law. They contended that, whether a notice was "given" by fax or by delivery in Switzerland, the ASC was in breach of art.271. Insofar as the notices had been sent to Leumi and ASC by fax, the argument accepted, contrary to other submissions made by Leumi and EBC, that service of secondary notices by fax is ordinarily permissible under the Corporations Law. Leumi and EBC acknowledged that s.110D expressly applied Chapters 1 and 6 of the Corporations Law to acts outside Australia. However, they argued that s.719 should not be read as authorising acts outside Australia which were or might be illegal under Swiss law, as infringing Swiss sovereignty. It followed from their argument that the purported service of the secondary notices was invalid. They also argued that a secondary notice served on a Swiss corporation in contravention of Swiss law could not be said to be "received" by the corporation for the purposes of s.722 of the Corporations Law. Thus the duty created by s.722, which requires a person receiving a secondary notice to comply within two business days of receipt, was not enlivened. I have previously found that service of a secondary notice on a Swiss corporation in Switzerland, by means of a courier, is likely to contravene art.271 of the Swiss Penal Code. I have also found that service of secondary notices in Switzerland, by means of faxes sent from Australia, might contravene art.271, but that the risk of a successful prosecution under Swiss law is less than where service is actually effected by delivery of the documentation in Switzerland. The Question of Construction As with the duty to comply with secondary notices, the question of whether service of secondary notices can be effected on a foreign corporation in contravention of foreign law is to be determined by a process of construction of the legislation. That process must take account of the principles of statutory construction to which I have already referred. Those principles mean that an Australian court will not lightly construe legislation as authorising service of notices or other documents outside Australia, in contravention of the law of another country. The legislation governing service of documents sometimes makes it clear that service cannot be effected in a foreign country in breach of that country's laws. An example is RSC 0.11, r.6(3), applied in Ferrarini SpA v Magnol Shipping Co Inc (The "Sky One") [1988] 1 Ll LR 238 (QBD/Staughton J.). Compare the language of FCR, O.8, r.5, which does not make it entirely clear whether service of court process must be effected in accordance with the law of the place of service. Sometimes the legislation contemplates service in another country, but does not specifically state whether service in breach of the local law is authorised. The question is then whether, having regard to the principle that legislation should be construed in conformity with principles of international comity, there is sufficient indication of a legislative intent that service on a foreign corporation is authorised, even in breach of foreign law. In my opinion there are two main factors which suggest that the Australian legislatures enacting the Corporations Law intended s.719 to authorise the giving of a secondary notice to a foreign corporation, even if to do so contravenes or might contravene foreign law. First, I have already concluded that the legislative intention is to impose a duty on foreign corporations to comply with s.722, even if to do so contravenes foreign law. It is but a short step to conclude that a notice may be given to such a corporation, even if the giving of the notice contravenes foreign law. I accept that resolving one issue does not necessarily resolve the other, since the different foreign laws may promote different interests. Secrecy laws, for example, are likely to protect commercial or economic interests. Provisions such as art.271 of the Swiss Penal Code are intended to protect the sovereignty of the country enacting the law. However, the rationale for applying s.722 to corporations such as Leumi and EBC is that, if this step were not taken, the regulatory scheme for listed Australian companies, created by Part 6.8 of the Corporations Law, could be readily avoided by the use of foreign nominee corporations in jurisdictions with stringent secrecy laws. A similar rationale can be applied to the question of service. While a notice could be "given", for example, to a Swiss corporation in conformity with the requirements of Swiss law, the practicalities are that the giving of such a notice is unlikely to be achieved within the short period that in my view Part 6.8 contemplates. In the present case no party adduced evidence of the requirements of service under Swiss law. I would not be prepared to infer from the material before me that service of secondary notices could be arranged in Switzerland in accordance with Swiss law within a short period (say, two to three weeks). I did not understand Mr White or Mr Conti to suggest otherwise. I do not think that significant delays in "giving" secondary notices to foreign corporations are consistent with the objectives of Part 6.8. The time limits specified in Part 6.8 for compliance are very short indeed, reflecting the perceived need for extremely swift responses to ensure that the market for Australian securities is properly informed and that uninformed transactions do not take place. If a notice could only be given in accordance with the requirements of foreign law, the regulatory structure inevitably would encounter formidable difficulties. The facts of Re North Broken Hill Holdings Ltd, in which a chain of companies was interposed between the registered shareholder and the beneficial owner, illustrates the nature of the difficulties. It is true, as Mr White suggested, that it is open to regulators to enter into memoranda of understanding (MOUs) with foreign regulators, providing for a framework for investigative assistance and exchange of regulatory and investigative information. Evidence was adduced of media releases which noted the entry into such MOUs by the ASC with its counterparts in the United Kingdom, Hong Kong, the United States and France. The precise scope of the MOUs, and their impact (if any) on the service of Australian documents in jurisdictions outside Australia, was not, however, explored in the evidence. It may well be that the cause of bilateral relations would be assisted by agreements between regulators or treaty arrangements governing issues of the kind involved in the present case. But the fact that MOUs might be entered into and (although this was not established in the evidence), that some MOUs might provide for service of documents by Australian regulators in foreign countries, does not determine the scope of Part 6.8 of the Corporations Law. That must be decided by a process of statutory construction, having regard to the purpose of the statutory scheme. Mr White also pointed out that, in addition to serving documents in accordance with the requirements of Swiss law, Australian regulators may seek assistance from the authorities in other countries under treaty arrangements contemplated by Australian legislation. The objects of Mutual Assistance in Criminal Matters Act 1987 (Cth) include facilitating the provision and obtaining of international assistance in criminal matters by means such as obtaining evidence and documents, restraining dealings in property liable to forfeiture and the service of documents: s.5(a),(c),(h),(k). A treaty was concluded between Australia and Switzerland on Mutual Assistance in Criminal Matters on 25 November 1991, and came into effect on 31 July 1994: Australian Treaty Series 1994, No.7. The Mutual Assistance in Criminal Matters (Switzerland) Regulations, reg.4, applies the Act to Switzerland, subject to such limitations and qualifications as are necessary to give effect to the Treaty between Australia and Switzerland . In my view, the Treaty between Australia and Switzerland has little bearing on the proper construction of the Corporations Law. The Treaty is confined to granting of mutual assistance in "investigations or proceedings in respect of offences the punishment of which falls or would fall within the jurisdiction of the judicial authorities of the Requesting State" (art.1). The Requested State is to effect service of a document required to be served by the law of the Requesting State in connection with any investigation of an offence or proceeding (art.17(1)). Part 6.8 of the Corporations Law is not concerned exclusively or even primarily with the investigation of offences or proceedings in respect of offences. The principal object of the Part is to promote an informed market in Australian securities. No doubt secondary notices are sometimes served in the course of investigations. But in many cases secondary notices will not be served in the course of any criminal investigation, but simply in order to obtain information considered necessary to inform the market. In these circumstances, I do not think that the fact that assistance is available in connection with the investigation of criminal offences lifts the construction that otherwise should be placed on s.719 of the Corporations Law. I should note that at least one practice book refers to service of Australian documents in Switzerland being governed by the Convention Regarding Legal Proceedings in Civil and Commercial Matters, signed in London on 3 December 1937: N. Williams, Civil Procedure Victoria, para.17.09.20. Australia acceded to the Convention on 11 February 1940, pursuant to art.9 (see Australian Treaty List, Australian Treaty Series No.1, at 135). However, the Convention does not deal with service of documents. The second factor suggesting that a notice may be served on foreign corporations in contravention of foreign law is that the regulatory scheme established by Part 6.8 of the Corporations Law applies, relevantly, to shareholdings in Australian listed companies. The maintenance of an informed market in the trading of shares in such companies is plainly a matter of great economic significance for Australia. The giving of secondary notices to shareholders in Australian companies by the ASC is an integral part of the scheme. The legislation contemplates that secondary notices can be given to foreign corporations, even if they do not conduct business in Australia. If there were any doubt about this, it is removed by s.110D, which specifically applies the provisions in Chapter 6, including s.719, to "all bodies corporate...whether formed or carrying on business...in Australia or not" (emphasis supplied). Section 110D also applies the provisions of Chapter 1, including ss.109X and 109Y (which deal with service of documents), to foreign corporations. It seems to me that the legislative intention is that foreign corporations holding shares in Australia listed companies should be liable to be given secondary notices in the same expeditious manner as Australian shareholders. I appreciate that s.110D does not expressly deal with the case where the giving of a notice by the usual means contravenes foreign law. But in applying Part 6.8 to all corporations, foreign or otherwise, the legislature must have been aware that some foreign countries, whose corporations are active in the Australian securities market, prohibit the service of documents otherwise than in accordance with their own domestic rules. In my opinion, the better view is that the legislatures enacting the scheme embodied in the Corporations Law intended that the notice could be "given" to foreign corporations by the same speedy and relatively informal means as apply to local shareholders. This intention should be given effect notwithstanding the presumption against Australian laws authorising conduct overseas that may contravene foreign law. In the next section of this judgment I express the view that secondary notices ordinarily can be given by fax. I think that this mode of service can be used in relation to Swiss corporations holding shares in Australian listed companies, even in circumstances where there is some risk that service by this means contravenes Swiss law. VIIIWAS SERVICE OF THE SECONDARY NOTICES BY FAX AUTHORISED BY THE CORPORATIONS LAW? The Arguments It will be recalled that, on 20 April 1995, the ASC transmitted secondary notices by fax to Leumi and EBC in Switzerland. Leumi admitted in its pleadings that it had received the fax on that date, although denying that that constituted the giving of a notice under s.719(1) of the Corporations Law. EBC denied the allegation made in ASC's further amended statement of claim, that the ASC duly gave EBC a secondary notice on 20 April 1995 by means of the fax sent on that date to EBC in Switzerland. However, EBC's faxed reply to the ASC, of 21 April 1995, acknowledged receipt of the fax sent by the ASC on 20 April 1995. I infer from this acknowledgment that the fax of 20 April 1995 was received at EBC's offices in legible form at about the time it was sent by the ASC. The ASC contended that, in those circumstances, notices had been "given" both to Leumi and EBC on 20 April 1995, within the meaning of s.719(1) of the Corporations Law. Alternatively, the ASC argued that Leumi and EBC had "received" the secondary notices for the purposes of s.722(1), and thus their respective obligations to comply with the notices were enlivened. Leumi and EBC argued that service of a secondary notice on a foreign corporation could be effected only in accordance with the modes of service authorised by s.109X(1)(b) of the Corporations Law. The requirements of that sub-section were not complied with, at least until subsequent service of the original secondary notice by courier. This was because transmission of a message by fax could not be said to constitute "leaving" the document at the recipient's office. Clearly the document had not been sent by post. Thus, no secondary notice had been "given". Nor had such a notice been received by Leumi since only notices that had been duly given were capable of being received and the admission on the pleadings was confined to receipt of the fax. The Authorities The Corporations Law does make some reference to service by fax. Section 747(1), for example, allows a document to be served on a securities exchange by sending to the exchange "by telegraph, telex, facsimile service or other similar means of communication", a message to the effect of the document. However, the Corporations Law does not specifically address the question of whether service of documents by fax is generally authorised. This is somewhat curious. The technology, although relatively recent, is utilised widely, if not universally, in commercial transactions, especially in international dealings, although it is no doubt being supplanted for some purposes by other means of electronic communication. It might be thought sensible for those responsible for reviewing the Corporations Law (and, for that matter, other legislation relating to service) to consider the issue. In the meantime, the question, to adopt the language of Woolf L.J. in Hastie & Jenkerson v McMahon [1990] 1 WLR 1575 (CA), at 1579, is whether the Corporations Law prevents advantage being taken of the progress in technology which enables a notice to be served on a foreign corporation by fax. The efficacy of service by fax is increasingly being recognised by courts, although of course everything must depend on the particular language of the statute or rule under consideration. In Hastie & Jenkerson v McMahon, the Court of Appeal held that the transmission of a list of documents by fax to opposing solicitors constituted good service, it having been conceded that the solicitors had received a copy in clearly legible form before a deadline for service of the list had passed. The Court construed the rule of court, specifying the means by which "service of any document...may be effected", as permissive rather than mandatory or exhaustive. Woolf L.J. (at 1579) observed that "[t]he purpose of serving a document is to ensure that its contents are available to the recipient and whether the document is served in the conventional way or by fax the result is exactly the same." See also Sharpley v Manby [1942] 1 KB 217; Stylo Shoes Ltd v Prices Tailors Ltd [1960] Ch. 396. In Hastie & Jenkerson v McMahon, Woolf L.J. observed (at 1579) that special considerations applied to writs and other documents used to initiate legal proceedings: see The Supreme Court Practice, 1995, 10/1/3. In NM Superannuation Pty Ltd v Hughes (1992) 27 NSWLR 26 (S.Ct. NSW/Cohen J.), the rules of a superannuation fund provided for a company to terminate the fund by giving the trustee notice in writing. Cohen J. held (at 35-36) that a notice had been given in accordance with the rules where the company sent the notice by fax and the fax was received in the offices of the trustee. His Honour noted that the rules did not require the notice to bear a signature or seal and therefore he did not have to decide whether a fax would be proper service if the document to be served did have to be signed or sealed (at 35). The decision of Cohen J. was affirmed on appeal, sub nom Hughes v NM Superannuation Pty Ltd (1993) 29 NSWLR 65 (NSWCA), although the question of service was not addressed. The Construction Issue In the present case, it is clear that s.109X(1)(b) of the Corporations Law does not prescribe exhaustively the modes of serving a notice on a foreign corporation. Section 109X(2)(a) specifically contemplates that another provision of the Corporations Law might authorise the service of a document, otherwise than as provided in s.109X(1). The question is then whether s.719(1) authorises the giving of a secondary notice to a foreign corporation by fax. Section 719(1) must be read in context. The objectives of Part 6.8 of the Corporations Law have been referred to elsewhere in this judgment. Those objectives, together with the stringent time constraints imposed by ss.721 and 722 on the recipient of a notice, suggest that service of a notice by fax was within the contemplation of the legislature. The giving of a notice by fax is a means of achieving more or less instantaneous communication of the contents of the document. Where an inquiry is made under Part 6 of the Corporations Law, time may well be of the essence, if the objective of maintaining an informed market is to be achieved. The legislation recognises that swift responses to inquiries are required if the statutory scheme is to be effective, by imposing an obligation to respond to a notice (or to seek an exemption) within two business days of its receipt. Insofar as a secondary notice is directed to a foreign corporation, service by fax may pose fewer risks, under laws such as art.271 of the Swiss Penal Code, since the transmission is initiated outside the country in which the corporation is located. As I found earlier, the risk of a successful prosecution under Swiss law is less where service is effected by fax than where it is effected by delivery in Switzerland. More importantly for present purposes, however, the language used in Part 6.8 supports the conclusion that a secondary notice can be given by fax. Section 717 provides that a secondary notice is a "written notice addressed to a person" requiring certain particulars of shares in which he or she has a relevant interest. Section 717 does not state, for example, that the notice must be signed or sealed in a particular manner. Section 722 imposes an obligation to comply with the notice upon a person who "receives" the notice, unless a request for exemption is made under s.721. The use of the word "receives" strongly indicates that the object of s.719(1), in providing for a secondary notice to be "given", is to ensure that the person to whom it is addressed actually receives its contents. This in turn suggests that a notice may be "given", for the purposes of s.719, even if the mode of service utilised for a foreign corporation is not one of those specified in s.109X(1)(b). I do not think that the fact that s.747(1), to which I have referred earlier, specifically mentions service by fax in a particular context detracts from the construction of s.719 I have adopted. The question is what meaning should be accorded to the words "give to the other person a secondary notice", having regard to the context, including the terms of s.722. Nor do I think that cases such as Racecourse Totalizators Pty Ltd v Hartley Cyber Engineering Pty Ltd (1989) 7 ACLC 902 (S.Ct Vic/O'Bryan J.), which concern service of statutory demands, assist in this case, since they depend on different statutory provisions. In my opinion, a secondary notice can be "given" under s.719(1) of the Corporations Law by fax. However, I agree with the holding in Hastie & Jenkerson v McMahon, that it is necessary for the person or body giving the notice to establish that a legible copy was printed at the recipient's premises. This is necessary because the purpose of a notice requirement is to ensure that the recipient is advised of the contents of the notice. Generally speaking, a notice is not "given" (if one of the modes specifically authorised by the Corporations Law is not utilised) unless the recipient receives the contents of the notice in legible form. An Original Document? Leumi and EBC argued that a notice could not be given by fax because, as a matter of construction, what was required was service of an original, signed document. It is true that a statute may require that a document be signed or sealed by a particular person or officer and that the absence of such a signature or seal might render the document invalid. This was held to be the case with a summons given by a justice "under my hand and seal": Electronic Rentals Pty Ltd v Anderson (1971) 124 CLR 27, at 41-43, per Windeyer J., with whom Barwick C.J. and Owen J. agreed. However, a requirement that a document be "signed" by a solicitor has been held to be satisfied by the solicitor stamping the document with a rubber stamp containing a facsimile representation of his signature: Goodman v J. Eban Ltd [1954] 1 QB 550. The Corporations Law defines a "secondary notice" simply as a written notice addressed to a person requiring the person to give...a written statement" setting out certain particulars relating to shares: s.717. Section 719(1) specifies the circumstances in which the ASC may give a secondary notice in relation to shares, but does not provide for any particular form of notice to be employed. The Corporations Regulations, reg.6.8.01(4), state that, for the purposes of s.719(1), a notice "may be in accordance with Form 609". Form 609 makes provision for the notice to be "signed for the Australian Securities Commission by (name)". In my view, none of these provisions detracts from the conclusion that s.719(1) of the Corporations Law authorises a secondary notice to be given by fax, as long as the notice is received in legible form by the recipient. The Corporations Law itself does not require the secondary notices to be signed or sealed. A written notice, which is all that s.717 relevantly requires, ordinarily can be given by fax, as NM Superannuation v Hughes illustrates. Regulation 6.8.01(4) is permissive, not mandatory, in its terms. Although the prescribed form, which was followed by the ASC in this case, provides for a signature, a non-mandatory form cannot control the question of statutory construction. The question is whether the Corporations Law contemplates that secondary notices can be given by fax. In any event, I think that a notice, duly signed on behalf of the ASC, can be "in accordance with Form 609" even though the notice is given to the recipient by fax. The original notice was signed and the document reproduced at the offices of Leumi and EBC and (as I infer) contained an exact reproduction of the signature. It follows from what I have said that Leumi and EBC were each given secondary notices by the ASC, within the meaning of s.719(1) of the Corporations Law, on 20 April 1995. In any event, I think that they "receive[d]" the secondary notices, within the meaning of ss.721 and 722 of the Corporations Law on that day, since each received a legible faxed copy of the secondary notices issued by the ASC on 18 April 1995. IX WERE THE SECONDARY NOTICES INVALID BY REASON OF ANY PRE-JUDGMENT BY THE ASC? Mr White argued that, at the time the ASC gave the secondary notices to Leumi and EBC (assuming that they were otherwise valid), it had already determined the attitude that it would take to any request by the Swiss Corporations for relief under s.721(1) of the Corporations Law. The ASC had therefore prejudged any such request that might be made by Leumi or EBC, and it was unable to give genuine consideration to their claims for relief. The prejudgment by the ASC was said to be evidenced by the terms of the letter of 26 April 1995, which was faxed by the ASC to Leumi in Switzerland. In that letter, the ASC warned Leumi that if a satisfactory response to the secondary notice was not received by 4 p.m. on 28 April 1995, the ASC intended to institute proceedings in the Federal Court to enforce compliance. The letter included the following paragraph: "Further, the Commission does not accept that Swiss Secrecy Regulations are sufficient reason not to provide the information required under the above Notice". In addition, Mr White relied upon two paragraphs in Policy Statement 86: Beneficial Ownership Notices, issued by the ASC on 31 October 1994, as amended. The express purpose of the statement (para.1) is to set out: "principles and policy considerations which will influence the exercise of discretionary powers conferred on the ASC by Pt 6.8 and the enforcement of notices issued under that Part". The two paragraphs cited by Mr White from the policy statement are as follows: "32. The only grounds on which complete relief will normally be granted are those set out in s.727(c) and (d), that is, that the information already appears on a register kept by the company or that the notice was frivolous or vexatious. Difficulty in complying with the notice within the time required is not a special reason, unless there are circumstances special to the applicant's shareholding in the company. ... 52. Where the defaulting recipient is an overseas person or corporation, orders sought will usually deal with the relevant shares, including the vesting of the shares in the ASC under s.613(1)(e). The orders may also include remedial orders listed in s.613(1)(a) - (g). The ASC may seek orders under s. 742 even if the law of another jurisdiction prevents a person from complying with Pt.6.8." Mr White contended that the principles of procedural fairness, including the rules as to alleged bias, apply to a decision to issue a secondary notice under s.719(1) of the Corporations Law. Mr White cited in support of this proposition Little v Minister for Land Management (1992) 77 LGRA 346 (S.Ct. Qld/Shepherdson J.), at 370-371. That case concerned a notice of resumption, which serves a very different function from that performed by a secondary notice issued under the Corporations Law. Moreover, the Queensland legislation was quite different from that governing the giving and enforcement of secondary notices. Furthermore, the declaration made by Shepherdson J. relating to the effect of bias on the part of the Minister, was set aside on appeal, albeit it on other grounds: Little v Minister for Land Management [1995] 1 Qd R 190 (Qld CA), at 202. Mr White's argument also assumed that the effect of prejudgment by the ASC would be to render the decision to give the secondary notices to Leumi and EBC void - compare Wade, Administrative Law (6th ed. 1988), 331 ff; Craig v State of South Australia (1995) 131 ALR 595 (H.Ct.), at 600. Neither Leumi's cross-claim nor EBC's cross-claim sought orders setting aside or otherwise attacking the decision by the ASC to give the secondary notices to Leumi and EBC. I am prepared to assume, without deciding, that Mr White is correct on the issues to which I have referred in the previous paragraph. I also assume, contrary to the conclusions I reach later, that the letter of 26 April 1995 and the paragraphs in the Policy Statement show that the ASC prejudged any application for relief that might have been made by Leumi and EBC under s.721(1) of the Corporations Law. Even so, I cannot see how such a prejudgment could invalidate the decision to give the secondary notices to Leumi and EBC. That decision was made in the exercise of the ASC's powers under s.719(1). Those powers are conditional upon the existence of circumstances specified in the sub-section. In particular, the ASC can act only if it receives information, pursuant to a primary or secondary notice previously given in relation to particular shares in a company, that (relevantly) another person has a "relevant interest" in any of the shares. If the ASC prejudges what it will do in response to a request, not yet made, under s.721(1), the prejudgment may taint any decision ultimately made by the ASC to reject the request. But the prejudgment does not, in my view, taint the interior decision to give a secondary notice to a person who has been identified as having a relevant interest in the shares. That decision is quite distinct from the rejection of a request under s.721 and is made on the basis of quite different criteria. I therefore reject the argument that the secondary notices given to Leumi and EBC were invalid by reason of prejudgment or bias on the part of the ASC. X DID THE ASC FAIL TO CONSIDER PROPERLY REQUESTS MADE BY LEUMI AND EBC UNDER S.721? Background Section 721(1) of the Corporations Law allows a person to lodge a written request that it should not have to give the information sought in the secondary notice, provided the request is lodged "before the end of 2 business days after the day on which the notice is received". Leumi argued that it made a request to the ASC to the effect that it should not be required to give the information sought in the secondary notice, by means of its fax of 27 April 1995. Since, as I have held, Leumi received the secondary notice by fax on 20 April 1995, its request was not lodged within the period specified by s.721(1). Therefore, unless the period of two business days is extended, there was no occasion for the ASC to consider whether the request should be granted. However, Leumi argued that the period of two days should be extended pursuant to s.1322(4)(d) of the Corporations Law. This sub-section permits the court to make an order extending the period for doing any act under the Law. The power is not to be exercised unless the court is satisfied that no substantial injustice has been or is likely to be caused to any person: s.1322(5). It is appropriate to consider Leumi's arguments on this issue, for two reasons. First, if Leumi's arguments are correct, it may be able to secure an extension of time for lodging the request. Secondly, if I am wrong in concluding that Leumi received a secondary notice by fax on 20 April 1995 for the purposes of s.722, it did not receive a secondary notice until it was served by courier on 24 April 1995. Mr Lindsay conceded that Mr Leumi's fax of 27 April 1995, having regard to time differences and local holdings, was given within two working days of Leumi receiving the secondary notice. Accordingly, if Leumi did not receive the secondary notice until 24 April 1995, and if Leumi's fax of 27 April 1995 constituted a "request" for the purposes of s.721(1), the request was made within the two day time limit. Accordingly, I need to consider whether Leumi did make a request for the purposes of s.721(1) and, if so, whether the ASC's decision to refuse the request should be set aside or regarded as invalid. EBC adopted Leumi's arguments on this issue, although its circumstance are not identical. EBC replied to the ASC's faxed secondary notice, which was sent on 20 April 1995, on the next working day, namely 21 April 1995. If EBC's fax was a "request", for the purposes of s.721(1), it was made within the two day limit. Accordingly, it is also necessary to consider whether the EBC's fax of 21 April 1995 was a "request" for the purposes of s.721(1) and, if so, whether the ASC's decision should be set aside or regarded as invalid. Did Leumi Make a Request? I shall deal first with Leumi's fax of 27 April 1995. This fax drew the ASC's attention to Leumi's status as a Swiss Bank and its obligations to maintain secrecy under Swiss law. Leumi stated that it would "clearly and seriously infringe applicable Swiss law" if it furnished the information required by the ASC "as per the said notice". The final paragraph of the fax reads as follows: "We trust that you and the Commission understand our position which is in compliance with applicable Swiss law and appreciate your and the Commission's comprehension." The Corporations Law does not define "request" as defined in s.721(1). Nor is a form of request prescribed. Mr White submitted that, in these circumstances, the fax should be read as, in substance, a request that the ASC not require Leumi to give the information sought in the secondary notice. He contended that the references in the fax to Swiss law were capable of being read as "special reasons set out in the request". The Macquarie Dictionary defines "request" as: "1. the act of asking for something to be given, or done, esp. as a favour or courtesy; solicitation or petition.... 2. that which is asked for.... 4. to ask for, solicit (something), esp. politely formally.... 6. to make request to, ask, or beg (a person, etc) to do something." Both Mr White and Mr Lindsay appeared to agree that the question was really one of impression. In my view, it is not appropriate to take a strict view of what constitutes a request for the purposes of s.721(1). The recipient of a notice is bound, under the terms of legislation, to respond extremely swiftly to the secondary notice. A recipient of a notice in a foreign country may find it difficult, whether because of unfamiliarity with Australian laws or language problems, to frame its responses precisely and with clear reference to the applicable legislation. Although the fax of 27 April 1995 is somewhat ambiguous, it is capable of being read as a request to the ASC to be relieved from the obligation to provide the information sought in the secondary notice. The last paragraph of the letter, in particular, can be construed as asking the ASC to exercise whatever powers might be available to excuse Leumi from complying with the secondary notice, because of Leumi's obligations under Swiss law. I think the benefit of any doubt in this respect should be given to Leumi. This is particularly so because the ASC's fax of 26 April 1995, whether or not it amounted to a pre-judgment, was not calculated to draw Leumi's attention to its entitlement to make a request under s.721(1). Accordingly, I think that the letter should be construed as a request by Leumi that for special reasons (Leumi's obligations under Swiss law) it should not have to give the information sought by the ASC in the secondary notice. Did EBC Make A Request? In my opinion, however, EBC is in a different position. It relies exclusively on the fax of 21 April 1995 to the ASC. That fax was terse and to the point. It asserted that "[d]ue to Swiss secrecy regulations we cannot, however, provide the requested details about the ownership of subject shares." This response contains nothing to suggest that EBC was asking the ASC to exercise its powers to excuse EBC from its obligations to comply with a secondary notice. The fax, in substance, simply constituted a refusal to provide the information. I think it would require considerably more than a sympathetic reading to convert the refusal into a request to the ASC to exempt EBC from its obligation to provide the information sought in the secondary notice. It follows that EBC has never made a request to the ASC pursuant to s.721(1) of the Corporations Law. Pre-Judgment by the ASC Mr White did not clearly specify whether he was arguing that the ASC was actually biased in relation to any requests under s.721(1) made by Leumi, or that there was a reasonable apprehension of bias on the part of the ASC. He contended, however, that the letter of 26 April 1995, from the ASC to Leumi, showed that the ASC had prejudged the issue of whether Leumi should be relieved from the obligation to comply with the secondary notices. He also contended that, regardless of the state of mind of the decision-maker, Mr Goldie, it was the corporate mind of the ASC that had to be assessed to determine whether the issue had been prejudged. The statement on which Mr White relied was made in a letter signed by Mr Dumas on behalf of the ASC. Mr Dumas had previously signed letters to Leumi as an investigator, located in the ASC's regional office in Sydney. Mr Dumas was not, however, the decision-maker in relation to what the ASC accepted, for the purposes of making decisions, were requests made by Leumi and ASC pursuant to s.721(1). Mr Goldie, a senior lawyer employed by the ASC, was given that task. He did so under delegation from the ASC, presumably made pursuant to s.102 of the Australian Securities Commission Act 1989 (Cth). The uncontradicted evidence was that Mr Goldie had not been involved either in the investigation conducted by the ASC into the ownership of shares in OAP or in the application by the ASC to the Federal Court. The determination made by Mr Goldie specifies the documents he took into account. These do not include the letter of 26 April 1995 from the ASC to Leumi and EBC. Nor was there any suggestion that Mr Goldie was subject to a direction from the ASC, when making his decision to reject the requests made by Leumi and EBC under s.721(1). In these circumstances, I do not think it can be said either that Mr Goldie was actually biased in making his decision, or that a reasonable by-stander would entertain a reasonable fear that his mind was so prejudiced in favour of a conclusion already formed that he would not alter that conclusion irrespective of the evidence or arguments presented to him: Laws v Australian Broadcasting Tribunal (1990) 170 CLR 70, at 100, per Gaudron and McHugh JJ. It is not enough to say, as Mr White did, that the ASC has a corporate mind and that if there is a reasonable apprehension of bias about one decision-maker within the ASC it must affect all others acting on behalf of the ASC. Laws v Australian Broadcasting Tribunal demonstrates that, independently of the doctrine of necessity, this is not necessarily the case: at 83-84, per Mason C.J. and Brennan J. Furthermore, the comment in the letter of 26 April 1995, although purporting to be made on behalf of the ASC, was not prepared in response to a request by Leumi or EBC (or anyone else) pursuant to s.721(1). The letter does not address that question. Its terms are consistent with the ASC simply expressing a view that the scope of s.719 of the Corporations Law is not limited by reason of the "Swiss Secrecy Regulations". This, of course, is an issue that has been debated at length in these proceedings and was doubtless at the forefront of Mr Dumas' mind. It must be remembered that by 26 April 1995 Leumi had not responded at all to the secondary notices and EBC had responded in a manner that amounted (as I have held) simply to a refusal to supply the information sought in the secondary notices. In that context, I do not think that the letter would suggest to a reasonable by-stander that the fresh decision-maker was incapable by reason of prejudice, of considering fairly the evidence and submissions presented to him in relation to any request that might be made under s.721(1) of the Corporations Law. I do not think that there is any substance in the contention that paras. 32 and 52 of Policy Statement No.86 amounted to a prejudgment that prevented the decision-maker considering the particular circumstances of Leumi and EBC. Paragraph 32 states that "normally" complete relief will only be granted only in specified circumstances. This plainly does not rule out a different approach if the circumstances are unusual. Indeed, it is not clear that para.32 is intended to apply to a request by a foreign corporation; certainly para.32 would not prevent a decision-maker, taking account of the particular circumstances affecting a foreign corporation that considered itself constrained by foreign law from complying with a secondary notice. Paragraph 52 merely refers to the orders that the ASC may seek. The statement that the ASC "may seek orders under s.742 even if a law of another jurisdiction prevents a person complying with Pt. 6.8" is not inconsistent with the ASC considering the particular circumstances of a foreign corporation making a request pursuant to s.721(1). I should add that Mr Conti, for EBC, adopted Mr White's arguments, relying on a statement in a fax from the ASC to EBC, sent on 26 April 1995, which was in substantially the same terms as the fax from the ASC to Leumi. Having regard to my finding that EBC made no request under s.721(1), it is not necessary to consider EBC's position separately. However, I would reach the same conclusion as I have in relation to Leumi. Alleged Failure to Take Into Account Relevant Considerations Mr White submitted that the decision-maker, Mr Goldie, failed to take into account relevant considerations. Mr White identified these as: l the potential criminal consequences under Swiss law for Leumi and its officers; l the fact that the power sought to be exercised by the ASC involved the extra-territorial application of the Corporations Law, so as to require actions in Switzerland which violated Swiss law; l the national interest of Switzerland in being able to provide reliable guarantees of confidentiality; l the possibility of obtaining judicial assistance from Switzerland pursuant to treaties; and l the reasonableness of EBC's conduct. The reasons given by Mr Goldie have been set out earlier. They were brief. The reasons state that Mr Goldie considered, among other documents, Leumi's letter of 27 April 1995, the letter from Leumi's solicitors of 21 June 1995 (in which Dr Schurmann's opinion on Swiss law was enclosed) and the letter from the solicitor of 28 June 1995, responding to the ASC's invitation of 22 June 1995 to make further submissions in respect of Leumi's request under s.721(1). Leumi did not seek a statement of reasons from Mr Goldie, as it was presumably entitled to do under s.13(1) of the Administrative Decisions (Judicial Review) Act 1977 (Cth). Had such a statement been obtained, there may have been an opportunity to analyse more fully Mr Goldie's reasoning process in reaching his conclusion. Moreover, Leumi took no other steps to challenge the statement by Mr Goldie that he had considered the matters referred to in the documents enumerated in his determination. Each of the points about which Mr White complains was made, in one form or another, in the documentation to which Mr Goldie referred. There is no reason to doubt that Mr Goldie took those matters into account, as he said he did. If some of the issues raised by Mr White were not canvassed in depth in the submissions made by Leumi, that was because Leumi did not avail itself fully of the opportunity to put forward arguments in support of its request pursuant to s.721(1) of the Corporations Law. In these circumstances, I do not think that Leumi has made out its contention that Mr Goldie failed to take into account relevant considerations in making his decision. The challenge to that decision therefore fails. XI DID LEUMI AND/OR EBC CONTRAVENE THE SUBSTANTIAL SHAREHOLDER PROVISIONS? Application of s.709 It was common ground that neither Leumi nor EBC had lodged substantial shareholder notices with the ASC. If Leumi and EBC were substantial shareholders in OAP at the relevant time, and if s.709(1) of the Corporations Law applied to them, they have each contravened s.709(1). It is therefore necessary to consider whether they have required to comply with s.709(1), notwithstanding that they were foreign corporations. Because of the conclusions I have reached in relation to the contraventions by Leumi and EBC of Part 6.8 of the Corporations Law, I state my conclusions on this aspect of the case more briefly. Mr White argued that, as a matter of construction, s.709(1) and the regulations prescribing the particulars to be included in a substantial shareholder notice (Corporations Regulations, reg.1.0.3, Form 603) and the specifying documents to accompany the notice (reg.6.7.01), could not apply to Leumi. He put this on two bases. First, a regulation making power cannot be exercised to prescribe that acts committed abroad by foreigners will be an offence: Air-India v Wiggins [1980] 1 WLR 815 (HL). Secondly, a regulation cannot validly impose an obligation to reveal information, the disclosure of which violates Swiss law. Mr Conti adopted this argument. In my view, each of these contentions fails because it is the legislation itself, rather than the regulations, that defines the acts or omissions that constitute offences under Australian law. Section 709(1) imposes the obligation upon a substantial shareholder to give a written notice in accordance with the section. Section 709(3) provides that the notice shall include inter alia, the prescribed particulars of the voting shares in the company in which the substantial shareholder or its associate has a relevant interest. Having regard to the terms of s.110D, it seems to me that s.709 contemplates that foreign corporations will be required to provide particulars as to beneficial ownership of the shares in which they or their associates have relevant interests. I also think that s.709 contemplates that foreign corporations must provide particulars as to beneficial ownership of the shares (unless excused by the Court under s.743), even though to do so will or might infringe foreign law. As with Part 6.7, the history of Part 6.8 of the Corporations Law supports this construction of s.709. The forerunner to Part 6.7 of the Corporations Law was Part IV, Div.3A (ss.69A-69N) of the Uniform Companies Acts. This legislation commenced on 1 March 1972 and implemented the recommendations of the Eggleston Committee. That Committee was influenced by legislation in the United States and Great Britain requiring disclosure of substantial shareholdings in listed companies. The Eggleston Committee gave reasons for requiring disclosure. (Company Law Advisory Committee to the Standing Committee of Attorneys-General, Second Interim Report (Parl. Pap. 43, 1969), paras. 4,6): "4. Reasons for requiring disclosure: Legislation such as that referred to above is, in our opinion, justified by the consideration that in the case of companies whose shares are traded on stock exchanges, shareholders are entitled to know whether there are in existence substantial holdings of shares which might enable a single individual or corporation, or a small group, to control the destinies of the company, and if such a situation does exist, to know who are the persons on whose exercise of voting power the future of the company may depend. The Acts, of course, do make provision for the registration of shareholders, but it has always been possible to conceal the identity of the person beneficially entitled by vesting the shares in a trustee. Indeed, the English Act of 1862 expressly provided that no notice of any trusts should appear on the register (see now section 156(4) of the Victorian Act); this provision no doubt originated in a desire to relieve the company from the necessity of determining whether particular dealings were in breach of trust, although the objective could have been achieved in other ways. At all events, it is now a common practice for investors to have their shares registered in the name of nominees, sometimes for purposes of concealment, but in many cases merely for convenience in dealing with the shares, for example, in the case of investors who are permanently or frequently absent from Australia. In other cases, shares are registered in the name of trustees under wills or settlements. The introduction of a requirement that all beneficial interests should be disclosed would lead to an enormous amount of paper work much of which would be pointless. We think, however, that the figure of 10% which has been adopted in the United States and in the United Kingdom is a reasonable one, and that provision should be made substantially along the lines of the United Kingdom legislation for the disclosure of interests giving rise to control of voting power where this reaches the 10% level. ... 6. Territorial operation of legislation: We think it is important that the legislation should be so expressed as to leave no doubt that the obligation of disclosure is intended to apply to persons resident, or companies incorporated, outside the jurisdiction, as well as to persons or corporations within the jurisdiction. We do not intend that there should be any discrimination against foreign investors, and indeed we do not consider that our terms of reference contemplate that we should make any distinction between Australian and overseas investors. Questions of foreign control of Australian companies, such as gave rise to the ordinance recently brought into force in the Australian Capital Territory, are therefore outside our field, and have played no part in the formulation of our recommendations. If, however, the legislation were so worded that it could be read as subject to a territorial limitation, so that a beneficial owner outside the jurisdiction of a State or Territory could claim that the obligation to give notice of substantial holdings did not apply to him, such persons would be able to gain control of companies by stealth in circumstances in which residents could not. We realise, of course, that the enforcement of the provisions against non-residents may be difficult, but we indicate below certain sanctions of non-compliance which, although they may not be fully effective, will we think, discourage any individual or company, whether resident or non-resident, from ignoring the provisions." From the outset, in accordance with the proposals of the Eggelston Committee, Part IV, Div.3A was expressed to apply, inter alia, to all bodies corporate, whether incorporated or carrying on business in Australia or not and to all acts done or omitted to be done, whether in Australia or not: see, e.g. Companies Act 1961 (NSW), s.69B. Legislation requiring disclosure by substantial shareholders was retained in the 1981 Code: Part IV, Div.4 (ss.134-146). The Corporations Law substantially adopted the Code provisions, except that the threshold for a substantial shareholding was reduced by 10% to 5%. The history of what is now Part 6.7 of the Corporations Law supports the view that it is intended to apply to foreign corporations, even if disclosure of beneficial ownership of the shares would or might infringe foreign law. The Eggleston Committee specifically rejected the notion that a territorial limitation should be incorporated in the legislation. It also focussed on beneficial ownership of shares in Australian companies, in keeping with its concern that the market should be aware who has the power "to control the destinies of the company". These factors strongly suggest that the scheme now incorporated in Part 6.7 would be at risk of being rendered ineffective if non-residents are able to avoid the disclosure provisions on the ground that compliance would or might breach foreign laws. As with Part 6.8, the legislation allows a foreign corporation caught between two legal systems to apply to the Court for relief pursuant to s.743 of the Corporations Law. Substantial Shareholder: Leumi The next question is whether Leumi and EBC were substantial shareholders in OAP and therefore within s.709(1) of the Corporations Law. On the evidence, I do not think that Leumi was a "substantial shareholder" in OAP for the purposes of s.709(1). This is because Leumi was a "bare trustee" of the shares held by it, within the meaning of s.39(b) of the Corporations Law and thus had no "relevant interest" in the shares. I am also satisfied, on the evidence, that Leumi acted on behalf of the beneficial shareholders in the performance of the functions attaching to a professional capacity or a business relationship, within the meaning of s.16(1)(a) of the Corporations Law. Since there is no other basis for a finding that Leumi is an "associate" of its clients in relation to the OAP shares held by it, no such finding can be made. In Corumo Holdings Pty Ltd v C. Itoh Pty Ltd (1991) 24 NSWLR 370 (NSW CA), one issue was whether a Mr Stapleton, who held a share in a company as trustee, was a "bare trustee" for the purposes of s.8(8)(a)(iii)(B) of the Companies (New South Wales) Code 1981, the predecessor to s.39(b) of the Corporations Law. The terms of the trust required Mr Stapleton to vote in respect of the share and execute notices, transfers and other instruments as directed by I Ltd and to pay all dividends and other benefits to I Ltd, or as directed by it. Meagher JA, with whom Samuels JA agreed, held that Mr Stapleton was a bare trustee (at 398-399): "A "bare trust" is one in which the trustee has no active duties to perform and is usually contrasted with a trust where there are such active duties. A recent discussion of the topic may be found in Gummow J.'s judgment in Herdegen v Commissioner of Taxation (Cth) (1988) 84 ALR 271. In that case, his Honour points out that the precise nuances of the phrase must depend on the context in which it is found. As a matter of strict logic a person in Mr Stapleton's position would theoretically have been in a position where he had an active independent duty to perform in some circumstances, for example, if he found himself so situated that he had a vote at a formal meeting and C Itoh had declined to instruct him how to exercise his vote. But, as a matter of strict logic, almost no situation can be postulated where a trustee cannot in some circumstances have active duties to perform. The applicants would have the phrase confined to situations where the trustee was immediately bound to transfer the share to his beneficiary. But this, in my view, is too narrow a construction, and would result in reading down the phrase so that it applied only to situations which almost never occur. Bearing in mind the evident statutory purpose, and particularly bearing in mind that s.230 imposes criminal penalties for its breach, I think the expression must be related to situations where a trustee is no more than a nominee or cypher, in a commonsense commercial view. The purpose of the exception contained in the sub-subparagraph is to disregard, so far as the category of "persons" having "relevant interests" in the shares in question all persons who, in a practical sense, have no say in the utilisation of the powers attaching to those shares. Where one remembers that C Itoh was not only the beneficial owner of Mr Stapleton's shares in JC No 7 and JC No 100 but was the only other shareholder in both companies, the prospect of Mr Stapleton ever voting independently of C Itoh must be remote indeed." Dr Belser's evidence leads to the following conclusions concerning Leumi's role in relation to the shares held by it in OAP: l Leumi acts exclusively on instructions in selling the shares, voting or dealing with dividends. It has no independent discretion. Any dividends received are paid to client accounts. l The Safe Custody Regulations, which govern the legal relationship between Leumi and its clients under Swiss law, require Leumi to act on instructions from the clients in relation to shares. The only relevant qualification to this is that, if an allotment of new securities is offered to holders of existing securities, and no instructions are received, Leumi "will make the best possible utilisation of these rights". Mr Lindsay relied on the transcript of a private examination of Mr Rivkin by the ASC, pursuant to the Australian Securities Commission Act 1989, s.19, to counter this evidence. In the examination Mr Rivkin, a stockbroker, referred to Leumi and EBC as fund managers. Mr Rivkin also said that he had been told by Mr Imfeld of Leumi (and Dr Fundulus of EBC) that Leumi (and EBC) could not reveal details of clients even if the clients requested that the information be disclosed. The context in which these comments were said to have been made was not, however, explored in Mr Rivkin's examination. Mr Rivkin also stated that he did not know in what capacity Leumi (or EBC) operated in relation to OAP shares. There was evidence in the proceedings before me that a small proportion of Leumi's business consisted of portfolios managed on a discretionary basis. In the absence of cross-examination of Dr Belser, I do not consider that the extracts from Mr Rivkin's examination justify me in rejecting or departing from Dr Belser's evidence. Nor do I think that Mr Rivkin's statement in his examination to the effect that he received instructions from Mr Imfeld in relation to the purchase of OAP shares is inconsistent with Leumi being a bare trustee of the shares in OAP, in the sense described by Meagher JA in Corumo Holdings Ltd v Itoh. Dr Belser's evidence, together with other evidence not in dispute, seems to me to establish that Leumi acted on behalf of the beneficial shareholders in the performance of the functions attaching to a business relationship. Leumi is a bank. Leumi is permitted to carry on business in Switzerland, subject to the provisions of the Swiss Banking Law. Leumi had a business relationship with the beneficial shareholders of shares in OAP. One of Leumi's functions in the course of that relationship was to carry out the instructions of the shareholders: cf. Heine Management Ltd v Australian Securities Commission (1994) 12 ACLC 138 (S.Ct. Vic/Hayne J.), at 153. Mr Lindsay did not suggest that, if there were a business relationship, Leumi was not acting in the proper performance of its functions arising from the relationship. Substantial Shareholder: EBC The evidence concerning the shares held by EBC is much less detailed. The only evidence adduced by EBC was a statement, on information and belief, by Ms Chang, a solicitor, as follows: "I have been further informed by Dr Fundulus by telephone on Friday 10 November 1995, and verily believe that in relation to all of the Offset shares the long established practice of EBC is to act in accordance with the instructions of its clients previously provided, and that EBC does not, consistent with that practice undertake commitments compromises or concessions in relation to its clients' affairs without instructions. Dr Fundulus informed me and I verily believe that consistent with such practice, all dealings with the Offset shares have only been made pursuant to specific instructions of the clients." In my opinion, this evidence is insufficient to establish that EBC was a bare trustee in relation to the OAP shares. The "long established practice" described by Ms Chang does not demonstrate that EBC, to use Meagher JA's language, was merely a nominee or cypher in a commonsense commercial view, having no practical say in the utilisation of the powers attached to the shares. The evidence does not address the nature of the legal relationship between EBC and the beneficial owners; nor does it detail whether EBC exercises any discretion in relation to voting rights. The exercise of such rights does not seem to me to be encompassed by the phrase "dealings with the Offset shares", at least without further elaboration or explanation. It follows that EBC cannot bring itself within s.39(b) of the Corporations Law and that it had a relevant interest in the shares held by it: Corporations Law, s.31. I therefore conclude that EBC contravened s.709 of the Corporations Law by failing to give a notice to the ASC within two business days of becoming aware of its relevant interest in the shares. It is unnecessary to consider whether EBC is an associate of its clients for the purposes of the Corporations Law. XIISHOULD LEUMI AND/OR EBC BE EXCUSED FROM THEIR CONTRAVENTIONS UNDER s.743? The Arguments Section 743(1) empowers the Court, on the application of an interested person, to excuse a contravention of a provision of Chapter 6 of the Corporations Law if it is satisfied, in all the circumstances, that the contravention should be excused. Section 743(3) provides that the circumstances to which the Court "may have regard" in deciding whether a contravention should be excused include "the contravention having been due to the person's inadvertence or mistake, to the person not having been aware of a relevant fact or occurrence or to circumstances beyond the control of the person". It is clear that the circumstances specified in s.743(3) do not exhaust the factors that may be taken into account in a particular case. Leumi and EBC argued that, if their submissions as to construction of the legislation were rejected, questions of international comity should nonetheless be taken into account in considering whether their breach of s.722 should be excused. Mr Conti, in particular, argued that it was not appropriate to consider the conduct of any party other than the corporation on whom the secondary notice had been served. The notices had been served only upon Leumi and EBC and it was their officers and agents who were at risk under Swiss law if they complied with the secondary notices. The Swiss corporations should not face the dilemma of either having to commit an offence in Switzerland or being penalised for failing to comply with the Corporations Law. Moreover, Mr Conti submitted that, if the ASC was to conduct an investigation into suspected criminal offences, such as a contravention of Part 6.7 of the Corporations Law, it should do so in accordance with the treaty arrangements described earlier in this judgment. Both Leumi and EBC contended that they had taken all steps available to them under Swiss law to comply with the secondary notices served on them. The fact that their clients had declined to consent to disclosure did not detract from the conclusion that the Swiss corporations had contravened s.722 by reason of circumstances beyond their control. Mr Lindsay submitted that it was "of central importance" in the case that persons claiming an interest in OAP through Leumi and EBC had deliberately chosen to acquire and maintain shares in an Australian company, but to decline to provide information that, but for Swiss law, they would be required to furnish to the Australian authorities. He pointed out that (as is the case) there was undisputed evidence to the following effect: l Dr Beker, a Swiss lawyer acting for Leumi, had personally given notice to the "relevant clients" of Leumi with respect to the secondary notice received by it on 24 April 1995. He had received express instructions not to disclose to the ASC the information sought in the notices. l Dr Fundulus had communicated by telephone with EBC's clients whom he "presumed" to be the beneficial owners of the shares held by EBC in OAP. All clients had informed him that they did not agree to the release of the information to the ASC. l EBC and Leumi were regularly were sent ANZ Nominees' "Custody Services Newsletter" which, on occasions, summarised the requirements of Australian law relating to the reporting of substantial shareholdings and the tracing of beneficial ownership in shares held in Australia companies. Mr Lindsay argued that this evidence showed that Leumi and EBC were aware of the requirements of Australian law. Moreover, their clients had refused to exercise the choice available to them under Swiss law, to instruct Leumi and EBC to make the disclosures sought in the secondary notices. Accordingly, the Court should not permit Leumi or EBC or their customers to circumvent the policy favouring the maintenance of an informed market. Exercise of Discretion In my view, the fact that the recipient of a secondary notice is at risk of violating the law of a foreign country by complying with the notice is an important factor to consider in the exercise of the discretion conferred by s.743(1) of the Corporations Law. In general, Australian courts should strive, so far as is consistent with Australian legislation, to avoid a situation where an individual or corporation is caught between the conflicting requirements of Australian law and foreign law: compare Bank of Crete SA v Koskotas (No.2) [1992] 1 WLR 919 (Ch.D/Millett J.), at 926. In particular, if a foreign corporation finds itself unable to comply with the requirements of Australian law, because it has been unavoidably placed in a position where to do so would conflict with the law of the country in which it does business, an Australian court would regard this as a very powerful reason to excuse a contravention of Australian law. It is also appropriate, in my view, to take into account that enforcement of the Australian law violates or might violate principles of international law or comity. I have previously held that, as a matter of construction, the Corporations Law requires a foreign corporation to comply with a secondary notice given under s.719(1), even where compliance places the corporation at risk of contravening foreign law. However, that does not mean that principles of international comity should be ignored in the exercise of a statutory discretion to excuse a contravention of s.722 of the Corporations Law. It is no light matter for Australian laws to be enforced in circumstances which infringe the legislative policies of other countries, even if those laws advance legitimate regulatory objectives in Australia. In the present case, there are additional factors that favour Leumi and EBC being excused for what would otherwise be a contravention of s.722. Both have endeavoured to obtain the consent of their clients to the release of the information sought in the secondary notices. Leumi provided information to the ASC in respect of 80,000 shares in OAP that it held as principal. I accept that the requests made by Leumi and EBC to their respective clients were made in good faith and that they would have acted on their clients' instructions to divulge the information sought, had those instructions been received. I did not understand Mr Lindsay to suggest that either Leumi or EBC was party to a deliberate attempt to circumvent Australian laws. In any event I would reject such a suggestion. The evidence showed, for example, that both Leumi and EBC were long-standing clients of ANZ Nominees. EBC had purchased shares in OAP before about 1990 on the recommendation of Mr Rivkin, a stockbroker. This is not a case where the evidence suggests that either Leumi or EBC has courted legal impediments to the production of the information: compare Securities and Exchange Commission v Banca Della Svizzera Italiana 92 FRD 111 (1981) (US Dist Ct, SDNY), at 117; Minpeco SA v Conticommodity Services Inc 116 FRD 517 (1987) (US Dist Ct, SDNY), at 528. Moreover, I am not in a position to assess the motives of the beneficial owners of the shares held by Leumi and EBC, since there is no evidence as to who the beneficial owners are or what prompted them to acquire their shares. Despite the factors suggesting that Leumi and EBC should be excused for their contravention of s.722 of the Corporations Law, in my view they are outweighed by other factors. First, Leumi and EBC each holds over 15% of the issued capital of OAP. Leumi's shareholding totals 16.97% of the issued capital. EBC's shareholding, if the BB Nominees parcel (which was the subject of a separate secondary notice) is ignored, totals 21.57%. I accept for these purposes that Leumi and EBC do not hold the shares beneficially (even though EBC is a "substantial shareholder" for the purposes of s.709(1)) and that it is possible that no single beneficial shareholder holds more than 5% of the issued stock. Nonetheless, the beneficial ownership of over 38% of the issued capital of a listed company is a matter of considerable importance to an informed market. The policy underlying Part 6.8 of the Corporations Law strongly suggests that contraventions relating to such significant shareholdings should not lightly be excused. In this connection, Mr Conti submitted that the market was adequately informed, despite the failure of Leumi and EBC to comply with the secondary notices, because of the take-over offers made by Fobiti and Arklow. But the fact that these offers have been made, following the contraventions of s.722, does not necessarily demonstrate that the market is fully informed. Nor, to the extent that the market is better informed, do the take-over offers show that Leumi or EBC are responsible for the improvement. The market for OAP shares includes persons who are contemplating or might contemplate making further offers. They still do not know who controls the shares held by Leumi and EBC. Furthermore, the evidence does not suggest any connection between Leumi and EBC and the take-over offers. The fortuitous advent of those offers, although perhaps having considerable importance for the form of relief, does not diminish the significance of the contraventions of s.722 having regard to the policy underlying Part 6.8 of the Corporations Law. Secondly, although this is not a case of bad faith, I do not regard Leumi and EBC as being placed in a predicament that is wholly beyond their own control. Under Swiss law it was open to Leumi and EBC, if they chose, to acquire shares in Australian stocks, only on behalf of persons or corporations prepared to waive the secrecy provisions. The point has been made in American cases that art.47 of the Swiss Banking Law and art.273 of the Swiss Penal Code are intended primarily to protect rights of commercial privacy rather than some broader public interest (Minpeco v Conticommodity at 525). The cases also suggest that hardship to Swiss corporations could be avoided if they obtained waivers prior to trading for customers' accounts: Minpeco v Conticommodity, at 527. Neither Leumi nor EBC adduced evidence to explain why such a course was not feasible or appropriate. I appreciate that, as I have found, compliance with the secondary notices exposes Leumi and EBC to a risk of prosecution for aiding and abetting the ASC's breach of Swiss law by serving the notices in Switzerland. However, I have also found that the risk of a successful prosecution on this ground is small. Thirdly, the fact that a contravention of Part 6.8 is not excused does not necessarily mean that a foreign corporation should be subjected to an order under s.742(2)(e) directing it to do an act in contravention of Swiss law. The appropriate course may be (and, in the present case, for reasons I will give, is) to limit the relief available to the ASC, so that neither Leumi nor EBC is compelled by a court order to provide the information sought in the secondary notices. Limiting the relief in these proceedings does not alter the fact that the foreign corporation has contravened Part 6.8. Nor does it prevent consequences flowing from the corporation's contravention of Part 6.8. It does, however, avoid the result that an Australian court directs a Swiss corporation to act in breach or possible breach of Swiss law. A fourth factor affects only EBC's submission that its contravention of s.722 should be excused under s.743 of the Corporations Law. I have found that EBC would not be at appreciable risk of a successful prosecution under art.273 of the Swiss Penal Code if it chose to reveal the beneficial shareholdings of non-Swiss domiciliaries in OAP. It has made no offer to do so. (Leumi's position in relation to art.273 is the same as EBC's. However, Leumi, unlike EBC, is subject to art.47 of the Swiss Banking Law.) I should add two further comments on this aspect of the case. First, I think that Mr Conti is correct in submitting that attention should be focussed on the conduct and position of Leumi and EBC, as the recipients of the secondary notices, rather than on what Mr Lindsay described as the deliberate conduct of the beneficial owners of the shares. I do not know what motivated those shareholders to refuse to waive the secrecy requirements of Swiss law. I am not prepared to find that their refusal stems from any desire to avoid Australian laws. Even so, for the reasons I have given, the contravention by Leumi and EBC of Part 6.8 of the Corporations Law should not be excused. Secondly, I do not think that EBC should be excused for its contravention of s.709(1). The factors I have identified in relation to the contraventions of s.722 apply to its failure to lodge substantial shareholder notices. XIII WHAT RELIEF SHOULD BE GRANTED? The Submissions The ASC, as I have previously noted, seeks declaratory relief and orders that Leumi and EBC comply with the secondary notices and that the shares held for them be vested in the ASC. Some of the submissions were directed to the proposition that to vest the shares in the ASC absolutely would amount to the confiscation of shares worth many millions of dollars for a contravention that carries a penalty of a fine of $2,500 and/or imprisonment for six months: Corporations Law, s.1311(3); Schedule 3. However, Mr Lindsay made it plain that the ASC is not seeking orders that deprive the beneficial owners of their entitlement to the shares or to the proceeds of sale of the shares. Rather, the ASC seeks orders limiting the entitlement of Leumi and EBC to deal with or obtain the benefit of the shares, unless and until each remedies its failure to comply with ss.722 and 723 of the Corporations Law. As I understood him, Mr Lindsay relied on ss.742(2) and 613(e) as the source of the power to make orders of this kind. Mr White, on behalf of Leumi, pointed out that in May 1995 Leumi had offered to agree to an order that would enable the shares to be disposed of in the market over a period of about six months. Given the take over offers made by Fobiti and Arklow, Mr White contended that, on an appropriate undertaking by Leumi to instruct ANZ Nominees to sell the shares pursuant to a current or future take-over offer, no remedial orders should be made. Mr White again stressed the need to take into account considerations of international comity and the co-operative actions of Leumi, within the constraints imposed by Swiss law. He also argued that, if the shares were vested in the ASC without any directions that they be disposed of, there could well be "unfair prejudice" (within the meaning of s.742(2)) to other shareholders of OAP. This was because the unavailability of 38% of the shares to an offeror might reduce the price the offeror was prepared to pay. Mr White further suggested that the offerors would be unfairly prejudiced if they were prevented from acquiring 100% of the shares in OAP. Mr Conti, for EBC, adopted Mr White's submissions on this issue. As I followed him, Mr Conti also argued that orders conditioning release of the shares or the proceeds of their sale upon EBC disclosing the information sought in the secondary notices, would constitute unfair prejudice to the officers and agents of EBC, who would be exposed to the risk of prosecution under Swiss law. Mr Oakes, on behalf of OAP, submitted that, since there were now two competing bids for the shares in the company, the overriding objective should be to ensure that the market is "efficient". Mr Oakes said that one purpose of the take-over provisions now contained in Chapter 6, is to ensure "that the acquisition of shares in a company takes place in an efficient, competitive and informed market": Gjergja v Cooper [1987] VR 167 (S.Ct. Vic/FC), at 215, per Ormiston J. The uncertainty created by the freezing orders or by vesting the shares in the ASC, without directing their disposal, was inimical to an efficient market. For this purpose Mr Oakes relied on an opinion given, without challenge, by the Chief Executive Officer of OAP, Mr Anstee. Mr Anstee expressed the view that the injunctions restraining sale of shares held by Leumi and EBC were inhibiting the operation of an efficient market. Mr Anstee also said that uncertainty surrounding the frozen shares could have a depressing effect on the share price, although he expressed this opinion before Arklow's take-over offer of 14 November 1995 and Fobiti's revised offer of 17 November 1995. Mr Oakes contended that OAP was unfairly prejudiced by the freezing orders and the orders proposed by the ASC because it had an interest in the take-over activity being conducted quickly and without uncertainty. Mr Muddle, for Arklow, submitted that it was inconsistent with the maintenance of an informed market that uncertainty should surround 38% of OAP's share capital. Any orders should therefore facilitate the sale of the shares to the highest bidder, but, if otherwise appropriate, quarantine the proceeds of sale by requiring payment to be made to the ASC. Mr Muddle argued that any order which prevented or hindered sale of the shares to the highest bidder would be unfairly prejudicial to Arklow, since it would be deprived of its ability to achieve its stated intention of acquiring all shares in OAP. There was evidence, which I accept, that Fobiti also wished to acquire 100% of the shares in OAP and would be prevented from doing so if the shares were not available to the market. Accordingly, Mr Muddle submitted that Fobiti would also be unfairly prejudiced if the shares were not available to the market. The Relief The relief granted in the circumstances of the present case must take into account several matters. First, s.744(2) provides that an order cannot be made under s.742 if the Court is satisfied that the order would unfairly prejudice any person. This is a statutory directive which must be followed. Secondly, the orders should advance the principal objective of Part 6.8, namely, to create and maintain an informed market for shares in listed Australian companies. Thirdly, the orders should intrude to the least extent feasible upon principles of international comity, including the principle that a foreign corporation and its officers and agents should not be required, by orders made by an Australian court, to perform acts that would or might infringe foreign law. Section 744(2) of the Corporations Law uses the term "unfair prejudice". The fact that a person is prejudiced by an order does not establish, of itself, that the order is unfair: Waldron v M.G. Securities (Australasia) Ltd [1975] VR 508 (S.Ct.Vic./Pape J.), at 532; Gjergja v Cooper, at 173-174, per McGarvie J., at 218-219, per Ormiston J. It is also not necessarily the case that if an "innocent person" is prejudiced by an order, that prejudice is unfair: Gjergja v Cooper, at 174. Whether it is or not may depend upon whether the order is essential to give effect to the relevant legislative policy and whether evidence is presented as to the precise nature of the prejudice said to have been suffered. In the present case, I consider that each of the competing bidders for shares in OAP would suffer unfair prejudice if orders were made under s.742 preventing the shares presently held by Leumi and EBC from being available for sale to the highest bidder. This would be the case, for example, if the shares were vested in the ASC, to be held by it until disclosure was made by Leumi and EBC of the information sought in the secondary notices. On the evidence there is nothing to suggest other than that the offers have been made in good faith and for genuine commercial motives. No suggestion has been, or could be, made that either of the offerors holds shares in OAP, other than those disclosed in their Part C Statements. Neither is responsible for the fact that 38% of the company's share capital is held by Swiss corporations, or that the beneficial shareholders refuse to consent to those corporations providing information to the ASC. The offerors each wish, for their own valid commercial reasons, to acquire 100% of the share capital in OAP. It is true that both Fobiti and Arklow were aware at the time they made their respective offers that the shares in OAP had been the subject of injunctions and that the ASC was seeking orders, inter alia, that the shares be vested in it. But Fobiti and Arklow and, for that matter, any other bidder, are entitled to expect that they can operate in a market unimpeded by orders that might lock up a substantial proportion of OAP's share capital for a considerable period. If the orders sought by the ASC were made, without ensuring that the shares are available to the market, the shares could be effectively frozen for a considerable period. Accordingly, I think that any order made under s.742 which fails to facilitate the sale of the shares held by Leumi and EBC to the highest bidder, would unfairly prejudice Fobiti and Arklow. Such an order therefore cannot be made. Mr Lindsay did not press for an order directing Leumi and EBC to comply with the secondary notices. To comply with such an order would expose the corporations and their officers to the risk of prosecution under Swiss law. In my view, any relief should be confined to declaratory relief and to orders affecting the shares or the proceeds of their sale. The shares, for the purposes of international law, are located within Australia. The next question is whether it is sufficient to make orders that have the effect of ensuring that the shares will be sold, or whether the shares and the proceeds of sale should be vested in the ASC (or, in the case of the proceeds, paid into court) until the information sought in the secondary notices is provided. Had the takeover offers not been made by Fobiti and Arklow, there would have been much to have been said for the latter course of action. The market remains less than fully informed if the identity of the beneficial owners of the shares held by Leumi and EBC is not known. The value of the shares is such that freezing them or the proceeds of their sale would be very likely to produce the information sought in the secondary notices. Moreover, the information might be provided in a way that does not infringe Swiss law. This would be the case, for example, if the beneficial owners of the shares instructed Leumi and EBC to comply with the secondary notices. Of course, in determining whether the shares or the proceeds of sale should be frozen until the information was provided, it would be necessary to take into account the open offer from Leumi and EBC, on the instructions of their clients, to sell the shares. The present case is, however, unusual because of the competing take over offers and the strong likelihood that one of these two bidders, or some other bidder who chooses to enter the fray, will succeed in obtaining control of the company if the Leumi and EBC shares are made available for purchase by the highest bidder. The availability of those shares to the bidders, although not establishing a perfectly informed market (since the identity of the beneficial shareholders is not known to the market), would remove the major source of uncertainty in the market and clarify what is to happen to the 38% of shares held by Leumi and EBC. Making those shares available for purchase by the highest bidder is likely as a practical matter to lead to the best price being realised for shareholders and to overcome any unfair prejudice that otherwise would be experienced by bidders for the company. To vest the shares in the ASC indefinitely, pending disclosure of the information sought in the secondary notices, would continue uncertainty and create a risk of further unfair prejudice to the bidders and, indeed, to other shareholders seeking the best price for their shares. An alternative is to allow the shares to be sold and to freeze the proceeds of sale until the identity of the beneficial shareholders is made known. This would not be an entirely futile exercise, since it would emphasise the importance of compliance with the disclosure provisions in Part 6.8 of the Corporations Law. But care must be taken not to make orders designed to punish those who, rightly or wrongly, might be suspected of sheltering behind Swiss secrecy laws. That is not a purpose for which the powers conferred by s.742 should be exercised. It is, however, appropriate to take into account the degree of culpability of Leumi and EBC in their contraventions of s.722 of the Corporations Law: Metals Exploration Ltd v Samic Ltd (1994) 181 CLR 109, at 126, per Mason C.J., Gaudron and McHugh JJ. If the proceeds of sale were effectively frozen until disclosure was made, the policy underlying Part 6.8 of the Corporations Law would be vindicated. But the probabilities are that any disclosure would be made after all shares in OAP had been acquired by one or other of the bidders. To my mind this would smack of punishment of the beneficial shareholders rather than pursuing the objectives underlying Part 6.8 of the Corporations Law. I do not think that the degree of culpability of Leumi and EBC is such as to warrant freezing the proceeds of sale. Their actions have been prompted by genuine concerns about the operation of Swiss law. Even though I have found that the predicament they are facing did not entirely arise out of circumstances beyond their control, they have not acted dishonestly or in a manner that can be characterised as reckless. They have raised in these proceedings matters of considerable importance and complexity that have not previously been determined by Australian courts. I have taken into account the finding I have made that EBC has contravened s.709, as well as s.722, of the Corporations Law. However, I do not think that this should result in different orders made in relation to EBC's shareholding than in relation to Leumi's shareholding. The question is which orders best give effect to the statutory objectives, having regard to all other relevant circumstances that should be taken into account in exercising the discretion conferred by s.742(2) of the Corporations Law. In the unusual circumstances of the present case, I think it is appropriate to make orders to the effect of those suggested by Leumi and EBC. The suggested orders are as follows: LEUMI: "That the first respondent instruct the third respondent to sell to the highest bidder on any day up to and including the last remaining date for the acceptance of any offer now current (whether or not subsequently varied or extended) for the shares of the eighth respondent ("the shares") or of any other offer made or announced during the term of any offer now current or any variation or extension thereof ("the relevant date"), any part of the whole of the parcel of the shares held by the third respondent such that by the relevant date the third respondent has disposed of the shares held by it for the first respondent. In this order "any other offer" means an offer for all or part of the shares: (i) whether or not subsequently varied or extended; and (ii)whether by Part A Statement, Part C Statement or by any other kind." EBC: "Order that the Second Respondent instruct each of the Third, Fourth, Fifth, Sixth and Seventh Respondents severally (the "EBC Nominees") to sell to the highest bidder on any day up to and including the last remaining date for the acceptance of any offer now current (whether or not subsequently varied or extended) for the shares of the Eighth Respondent ("the shares") or of any other offer made or announced during the term of any offer now current or any extension or variation thereof ("the relevant date"), any part or the whole of the parcel of the shares held by each of the EBC Nominees respectively such that by the relevant date each of the EBC Nominees has disposed of the shares held by it for the Second Respondent. In this Order "any other offer" means any offer for all or part of the shares: (i) whether or not subsequently varied or extended; and (ii)whether by Part A Statement, Part C Statement or by any other bid." It will be necessary to continue or to make orders to ensure that the shares held by Leumi and EBC are not disposed of, save in accordance with directions of the kind proposed by Leumi and EBC. In addition, the ASC is entitled to appropriate declaratory relief. I direct the ASC to bring in draft minutes of order. I shall hear the parties on costs. I certify that this and the preceding 125 pages are a true copy of the Reasons for Judgment of the Honourable Justice Sackville. Associate: Dated: 14 December, 1995 Heard: 20-21 November, 1995 Place: Sydney Decision: 14 December, 1995 Appearances: Mr G. Lindsay SC, instructed by Mr Peter Stepek, Regional General Counsel of the Australian Securities Commission, appeared for the applicant. Mr R.W. White and Ms P.P. Wines, instructed by Atanaskovic Hartnell, Solicitors, appeared for the first respondent. Mr R.A. Conti QC and Mr F. Kunc, instructed by Freehill Hollingdale & Page, Solicitors, appeared for the second respondent. Mr M. Oakes SC, instructed by Landerer & Company, Solicitors, appeared for the eighth respondent. Mr W.G. Muddle, instructed by Minter Ellison, Solicitors, appeared for the ninth respondent.