Chevron's cliff warning

PRACTICE POINTS

ACCC sues City Beach

• The ACCC has launched Federal Court proceedings against surf retailer City Beach, alleging it sold 57k+ non-compliant products containing button batteries. Products included keyrings, light-up Jibbitz and other toys. Despite warnings from state regulators, City Beach allegedly failed to meet mandatory safety and info standards—putting kids at risk with products that lacked proper warnings or child-resistant battery compartments. The ACCC is seeking penalties, declarations and injunctive relief.

• Hydrogen tax breaks are here—but only if it’s green. The Future Made in Australia Act 2025 has landed, locking in a $2/kg refundable tax offset (HPTI) for qualifying green hydrogen projects from 1 July 2027–30 June 2040. But it’s no free-for-all: projects must hit a 10MW capacity, pass the Guarantee of Origin scheme, and deliver community benefits. The HPTI won’t apply to blue hydrogen or any project using fossil fuels, even with carbon capture: KWM

• High Court tightens the screws on 'understanding' under Australian competition law. In a new decision, the High Court ruled that to prove an “understanding”, there must be real communication and a commitment (or reciprocity)—examining the one party’s conduct isn’t enough. A number of prohibitions under the Consumer Act rely on establishing that a “contract, arrangement or understanding”. The decision could shape ongoing cases like BlueScope and Delta: G+T

WORD ON THE STREET

HSF seals US merger

• Herbert Smith Freehills partners “overwhelmingly” backed a merger with Kramer Levin, adding $700m in revenue and 100+ partners. The tie-up makes HSF the first major Aussie-founded firm with serious US reach.

• Consulting firms now lobbying for themselves. With Canberra still cold on the big four, EY’s hired ex-Liberal minister Richard Alston’s lobbying shop to get back in the government’s good books. PwC’s using Labor-linked lobbyists, KPMG’s doing it in-house, and Deloitte’s using lobbyists to push its clients’ agendas: AFR

• Sparke Helmore has merged with Woods Prince Lawyers, doubling its corporate and commercial team in Queensland. 22 new arrivals, including two senior partners and a slew of lawyers and support staff, will now fly under the Sparke banner. The move supercharges Sparke’s Sunshine State footprint to nearly 140 lawyers and 18 partners: Lawyers Weekly

• ASIC and the ATO debate pursuing action against Luke Sayers, former CEO of PwC, after his testimony to parliamentary committees was deemed implausible. Sayers’ statements regarding his knowledge of confidentiality breaches were questioned, with ASIC considering potential discrepancies in his evidence. This comes after the Senate found his testimony at odds with other witnesses, raising concerns over his credibility: The Australian

TALKING POINTS

China slaps 34% tariffs

• China hits back with 34% tariffs on US goods, escalating its trade war with President Trump and sparking a global market rout. JP Morgan now tips a 60% chance of global recession, with Wall Street shedding US$2.4tn in a day. This tit-for-tat is just getting started: Mining Weekly

• ASX tanks as Trump tariffs ripple globally – the ASX 200 dropped 2.44%, with energy (down 7%) leading the slide. Oil giants Woodside and Santos fell by 8%. Now, we’re in “Black Monday” territory. ASX futures point to a further 4% plunge, with hedge fund legend Bill Ackman predicting a “economic nuclear winter” unless the tariffs end. In other bad news, the Australian dollar had its worst drop since 2008: Capital Brief, AFR

• Now, 29 out of 40 economists say the RBA will likely cut interest rates by 0.25% to 3.85% in May, with further cuts anticipated this year in response to Trump’s aggressive tariffs. The global trade tensions have led economists to bring forward their rate-cut predictions. But not everyone agreed. Chief Economist at Judo Bank said inflation was the immediate threat to tariffs, pushing rates back up: AFR.

• Dutton U-turns on work-from-home ban. After backlash from female voters and Trump comparisons, the Coalition has scrapped plans to mandate 5-day office weeks for public servants. WFH rights will stay untouched. While 41k public service jobs cuts are still on the cards, it'll happen gradually over 5 years through a hiring freeze and natural attrition—not forced sackings: AFR

TREASURY

DEAL ROOM

McLaren goes electric

• McLaren will pivot to all-electric luxury models after merging with EV startup Forseven under new owner CYVN Holdings. The merger forms McLaren Group Holdings, which now includes CYVN’s non-controlling stake in McLaren Racing, the current F1 World Champions: The Independent

• TikTok’s US spin-off deal stalls, as China refuses to approve the plan following Trump’s fresh 34% tariff hike. The deal—giving US investors control of TikTok’s US ops—was nearly done, but Beijing pushed back. Trump responded by extending the sell-or-ban deadline by 75 days, now set for mid-June, keeping the app alive—for now: Reuters

• Allegro Funds has locked in its first exit of 2025, selling its majority stake in Questas to Five V Capital at a $375m valuation. The hydraulics and water services group has tripled in size under Allegro, and the firm is said to have notched a 4x return: AFR

• PGIM Real Estate has successfully raised $2bn for its Global Data Center Fund, targeting investments in hyperscale data centers across North America, Asia Pacific, and Europe. The fund aims to deliver opportunistic returns through a build-fill-sell strategy, focusing on supply-constrained markets and incorporating ESG considerations in each investment: COMO

SECTOR SPECIFIC

Cybercriminals steal $500k

🚜 DIGGERS

• Chevron warns Australia’s losing its edge, with outgoing MD Mark Hatfield flagging growing investor unease. He says policy flip-flops and regulatory uncertainty are chipping away at Australia's long-held reputation as a stable place to invest. Japan’s already looking offshore, and even Woodside is eyeing the US: The Australian

• Despite its copper push, BHP predicts iron ore prices will stay above $80/tonne, bolstered by strong demand from machinery and electric vehicles. While concerns remain over the Chinese property sector, BHP’s Rag Udd believes China’s steel production will remain resilient, driven by new industries. He sees Simandou's supply as manageable, with depletion of older mines supporting price stability: AFR

🏦 FIN

• Cyber criminals hit Aussie supers, with AustralianSuper, ART, Hostplus, Rest and Insignia all targeted in a co-ordinated attack. Around 9,000+ accounts were affected, with $500k stolen from four AusSuper members. No funds lost at others. Albo has tried to downplay the attack, saying attacks happen “every six minutes”: The Australian

• Global spending on financial market data reached $44.3bn in 2024, growing at a slower rate of 6.4%, compared to the previous year's 12.4%. Key areas of growth included news products and institutional trading, while retail wealth management saw a slower growth of 3.9%. Major players like Bloomberg still dominate, but smaller providers are gaining traction with customised data: Finextra

🏡 RETAIL & REAL ESTATE

• One in five Aussie property deals last year involved Japanese investors, making up 14 out of 72 deals. $3bn in real estate flowed in, matching the previous 22 years combined, as firms like Mitsui Fudosan and Sumitomo Forestry chase stable rents and growth in a geopolitically steady market: AFR

• Star Entertainment faces a critical moment, with the NSW government and Bally’s Corp rescue efforts falling through. The company has been forced to explore voluntary administration options this week. With $250m in loans expiring soon, Star must secure asset swaps and refinancing or face collapse: The Australian

📱 TECH & START UP

• Microsoft hits pause on global data centre rollout, delaying or scrapping projects in Australia, the UK, and parts of the US, amid a possible AI ambition reset. But Microsoft still plans to drop US$80bn on AI data centres in FY25: Quartz

• Meanwhile, Meta plans to spend US$65bn on AI this year, dropping AI models Llama 4 Scout and Maverick. Both models are open source and Microsoft says they’re “most advanced” and fully multimodal AI models yet—handling text, video, images and audio: Reuters