The last two decades have seen the emergence of share buy-backs/repurchases as a global phenomenon. The objective of this article is to compare and contrast the previous and current Australian buy-back requirements with that of selected countries. This comparison is especially pertinent given that the Australian legislation underwent a major simplification process in December 1995. Moreover the simplification was undertaken with a view to reducing the complexity of the previous requirements and making them more comparable with overseas counterparts. The comparison reveals that some pre-simplification legislative procedures were not distinct to the Australian environment. In fact, the old requirements were similar to that of the United Kingdom and Hong Kong. However, the existing Australian buy-back requirements are now closer in concept with the more liberal New Zealand approach. Accordingly, emphasis centers on aspects concerning the disclosure of any items of a material/relevant nature and satisfaction of solvency conditions.That said, existing Australian buy-backs requirements still do not allow for the same ease of implementation as that of their NZ and US counterparts. As a consequence it is argued that legislative reform in permitting the use of treasury shares will provide increased incentives for buy-backs, as well as enhancing flexibility, control and improve efficiency in the flow of capital.Furthermore, the disclosure of any relevant director’s or related party’s interest in the repurchase together with their intention concerning the potential sale of shares is recommended as this information is useful for the market.
|Journal||Australian Journal of Corporate Law|
|Publication status||Published - 2001|