Cunliffe David: Third Readings 
Cunliffe David: Third Readings 
[Volume:616;Page:12423] 
Hon DAVID CUNLIFFE (Minister of State) 
 on behalf of the 
 Minister of Commerce 
: I move  
That the Building Societies Amendment Bill the Commerce Amendment Bill (No 2) the Companies Amendment Bill (No 2) the Co-operative Companies Amendment Bill the Distress and Replevin Amendment Bill the Financial Reporting Amendment Bill the Friendly Societies and Credit Unions Amendment Bill the Life Insurance Amendment Bill the Personal Property Securities Amendment Bill the Securities Amendment Bill (No 2) the Securities Markets Amendment Bill (No 2) the Superannuation Schemes Amendment Bill and the Unit Trusts Amendment Bill be now read a third time 
. 
The key public policy objective of this legislation is to ensure that the law affecting business operation is clear efficient and effective. The amendments are part of a programme of regular incremental reforms to improve our business law. When taken together these amendments have a significant and positive impact on the body of law under which businesses must operate. In particular they remove unnecessary compliance costs provide business—especially small and medium enterprises—with easier access to capital clarify and update various statutory provisions and achieve consistency between different legislative requirements. 
The legislation resulted from close and ongoing consultation with the business community. It addressed what that community indicated as being some of its concerns with business-related legislation. These are generally the cumulative costs of complying with legislation and the difficulties in reconciling different legislative requirements. The amendments reduce some of those costs and promote the efficient use of economic resources enterprise and innovation in the economy. One example of a compliance cost reduction contained in the legislation is the extension of the exemption from the prospectus requirements of the Securities Act from small employer superannuation schemes to all employer superannuation schemes. This will not only lower compliance costs but support the broader and widely held economic objective of providing for workers in their retirement and increasing the national savings rate. 
A number of submitters at the select committee said that complying with the disclosure requirements of the Securities Act imposes significant compliance costs on employer-based schemes and these costs have to be passed on to members. Extending the exemption will reduce those costs and remove a disincentive to the starting of new schemes. 
Another of the legislation’s key aims was to improve the clarity of our existing commercial law statutes in order to allow both businesses and regulators to proceed with certainty. Many examples of clarification were contained in the original bill two of which I will mention briefly. The first amends section 196(1)(a) of the Companies Act of 1993. This section provides that at each annual general meeting a company must appoint an auditor to hold office until the end of the next annual general meeting. It is not clear in the statute whether an auditor may resign before then. The bill contains a clause clarifying that of course an auditor can resign between annual general meetings. The second example is contained in amendments to the Superannuation Schemes Act of 1989. The amendments allow prospective members to look at or receive certain information. An obligation is placed on the scheme’s trustees to ensure the provision of information to prospective members. For consistency and clarification the trustees’ obligation extends to the provision of information to existing members. 
The legislation aims to remove anomalies in the law that have emerged over time. These inconsistencies can result in for example similar investment products being treated differently when there is no sound reason to do so. This inconsistency is seen in the Securities Act. Section 53E of the Act provides that issuers of equity securities debt securities life insurance policies unit trusts and superannuation schemes must have their financial statements audited annually by a qualified auditor. In the case of participatory securities annual audits are carried out only if the statutory supervisor so requires. The Securities Amendment Bill (No 2) contains a clause requiring that all arrangements or schemes to which participatory securities relate should be audited annually to remove that inconsistency. 
Another inconsistency in the law was found in the Superannuation Schemes Act. The Act confers on members the right to look at certain documents yet this right is not supported by any penalty provision and was therefore not enforceable. To correct this anomaly an amendment has been made to the Act’s offence provisions so that a penalty attaches if the member is denied the right to look at the documents. 
Lastly the legislation aims to update the law—a necessity in a rapidly changing business environment. Up to date statutory provisions allow businesses and regulators to take full advantage of technology and there are many examples of that. The Commerce Amendment Bill (No 2) contains an amendment that will allow the Commerce Commission to take advantage of technology to convene meetings. 
In conclusion I commend the third readings to the House of the various bills that have been split from the Business Law Reform Bill that came before the House. I am commending the various bills in this legislation because it helps to ensure the law affecting business operation is clear efficient and effective. In particular I want to thank the Commerce Committee and other members for the contribution they have made to the passage of these bills.