Case: Glencore International AG v Takeovers Panel (2005) 54 ACSR 708
Outcome: discussed
The notion that s 657D(2)(a) does not permit the Panel to make orders on the basis of a so-called " en globo " assessment of the likely loss or damages suffered by Rinker shareholders was said by CEMEX to be supported by Emmett J's comments in Glencore International AG v Takeovers Panel (2005) 54 ACSR 708 at 722, where his Honour said: [T]he review panel took no steps to determine whether, and if so, in what manner, any right or interest of any such person was affected by the non-disclosure. While the orders were purportedly made for the purposes of protecting the rights or interests of persons affected by the non-disclosure, the order applied indiscriminately to any person who sold shares on ASX during the relevant period, irrespective of whether any such person would have taken any different course had the relevant disclosure been made. 49 This submission does not take account of the amendments to the Corporations Act made by the Corporations Amendment (Takeovers) Act 2007 (Cth). The Explanatory Memorandum to the corresponding Bill makes it clear that the amendments were designed to respond to the concern that, following Glencore , "it may be open to read the Panel's powers and jurisdiction in the current legislation in way that is too narrowly formulated to enable the Panel to perform effectively the role envisaged for it by Parliament", in particular the power to make orders to protect the rights or interests of persons affected by unacceptable circumstances. In relation to s 657D(2)(a) the Explanatory Memorandum stated: Paragraph 657D(2)(a) of the Act currently allows the Panel to make orders it thinks appropriate to protect the rights or interests of any person affected by the circumstances. The amendment means that this is not confined to rights and interests directly affected by the circumstances. The amendment ensures that the Panel can make any order it thinks appropriate to protect any rights or interests of a person or group of persons, where the Panel is satisfied that their rights or interests have been, are being, will be or are likely to be affected by the unacceptable circumstances. This will allow the Panel to protect the interests of those persons more effectively. The amendment will also ensure that the Panel may make orders which protect the interests of a group of persons whose interests have been affected, rather than requiring it to address the effects person by person. (Emphasis added.) 50 I am satisfied that the Court was entitled to proceed en globo in its assessment of the extent to which shareholder's rights or interests were affected by the unacceptable circumstances. First, as well as being consistent with the express words of s 657D(2)(a) ("if the Panel is satisfied that the rights or interest of any person, or a group of persons ..."), such an approach recognises that the unacceptable circumstances misinformed the market as to the status of CEMEX's offer, thereby affecting the rights and interests of vendors of Rinker shares in that market, as a group. Counsel for ASIC, in my view accurately, summarised the steps taken by the Panel as follows: &#8226; identifying a group of persons, namely those who sold their Rinker shares between 10 April and 7 May 2007; &#8226; identifying the interests of those persons affected by the conduct, being the interest in ensuring that the relevant trading occurred in an efficient and informed market, and the interest in having a reasonable opportunity to participate in the benefits of the improved offer; &#8226; making a finding that the market value of the improved offer consideration was around $0.25; and &#8226; forming the view that an appropriate order was to compensate those persons in that amount.