HECS debt to slash by 20% 🎓

G’day.  

Welcome back to Point Blank – here’s the latest to kick off your week. 👇

 💼 Practice Points

• In a scheme of arrangement, the NSW Supreme Court stresses the importance of disclosing all shareholder communications before the first court hearing to the Court, so that the Court can assess whether the communications could affect the integrity of the scheme and influence shareholders' reactions to the scheme booklet.

• The ATO is ramping up its efforts to enforce tax compliance among large and multinational corporations in response to declining compliance rates, which will include adopting a more aggressive approach to audits and litigation, especially through its Tax Avoidance Taskforce.

• Calling all banking lawyers. Heads up—there are some important updates to Australia’s Banking Code of Practice coming in February 2025. Here’s what you need to know:

  • The small business threshold is increasing from $3m to $5m in borrowings, meaning more businesses can access protections.

  • Banks will need to offer clearer information about the risks for loan guarantors.

  • The definition of vulnerable customers has been expanded to cover things like language barriers, disability and financial difficulty.

 📢 Talking Points

• Thanks to a defence budget that’s all talk and no cash, Albo is set to scrap a $7bn military satellite project that was aimed at creating an unhackable data network for fighter jets, naval assets and ground troops.

• With Americans voting tomorrow in what’s shaping up to be a coin-flip election, Australia’s foreign and defence ministers scramble to cosy up to Trump’s former diplomat, Mike Pompeo, in an effort to bolster Australia’s ties. Meanwhile, with US authorities rolling out unprecedented security measures—think de-escalation training and bulletproof glass —election day begins to look more like a fortified bunker than a democratic exercise. Trump has also begun alleging electoral fraud in Pennsylvania, a key state, setting the stage for potential unrest—deja vu, anyone?

• It’s no fun finishing your law degree just to stare down a mountain of HECS debt. Here’s a silver lining: Labor promises to cut those debts by 20% if they’re re-elected. The measure looks the slash $16bn in HECS debt for 3 million Australians. That’s a $5,520 cut of an average loan of $27,600.

• The Sydney Marathon gets an uplift. Australia’s biggest marathon will join the ranks of New York, London and Tokyo as it enters the Abbot World Marathon Majors running series. This year’s event saw 5,000 more finishers than the previous year, making it the largest marathon ever held in Australia.

 🏦 The Treasury

• The RBA is poised to keep rates at the 13-year high at tomorrow’s meeting. Economists predict the Reserve Bank will even hold rates steady up until at least February.

 🤝 Deal Room

• Rio Tinto is racing against the clock to integrate copper-rich tenements owned by Entree Resources into its Oyu Tolgoi mine in Mongolia. This move is crucial to maintain copper production levels, as the mine is projected to become a major copper producer by 2030.

• The European Commission requires US chipmaker Nvidia to seek competition clearance for its $700m acquisition of AI startup Run:ai, reflecting heightened scrutiny of tech deals by regulators on both sides of the Atlantic.

• APA shares took a hit after talk of its $2bn bid for Zenith Energy, with investors still sceptical after its $1.8bn Alinta deal, which has yet to deliver meaningful returns.

• Doubts are creeping in about Yancoal’s bid for Anglo American’s coal assets as the Chinese government, which controls Yancoal’s majority shareholder, is yet to give its final approval.

• Neoen is finalising the sale of its Victorian portfolio to HMC Capital, using Iberdrola as a price gauge to help HMC hit the seller's target. Unlike Iberdrola, HMC isn’t held back by FIRB approvals, giving it an edge in sealing the deal.

🧠 Word Guess

Document revealing the law, perhaps in code (7)

🏗 Sector Specific

Diggers

• The MinRes saga continues as the AFR reports that founder Chris Ellison and other executives charged 70% above market rates for industrial properties that were leased to the mining group since 2006. Some estimate that the group may have overpaid by up to $10m for properties leased back to Board members through a series of trusts. Well karma has come this morning, as MinRes announce that Chris Ellison will pay $8.8m in penalties and Chairman James McClements will step down in 2025. The Board also looks to replace Ellison within the next 12-18 months.

• Centennial Coal’s decision to cash in on lucrative international coal sales instead of supplying Australia’s Eraring power station sparked the 2022 winter energy crisis and left Origin and households feeling the pinch.

• A crackdown on big bad oil and gas has led to a record $11.6bn in tax revenue for 2022-23, up from just $1.5bn in 2021-22. While mining giants like Rio Tinto and BHP dominate the tax contributions, many tech companies pay little, and Qantas reported $402m in taxable income but paid no tax at all.

• Meeting Australia’s goal of generating 82% of its power from renewables by 2030 demands an astonishing scale of development: 40 new wind turbines monthly, 22,000 solar panels daily and 6 gigawatts of new renewable energy per year.

• Chevron inks initial gas deal for WA ammonia project. The project aims to produce 600,00 tonnes a year of clean ammonia, which would be used to replace coal power in Asia and fuel oil and diesel in shipping.

Fin

• Macquarie shares took a 4% hit after a lacklustre earnings report that revealed a profit miss and a dividend cut. Despite this, CEO Shemara Wikramanayake is keeping her chin up, pointing to a rebound in deal activity. She also reassured ASIC chairman of the bank’s commitment to its regulatory duties, following a record $5m fine for not stopping some suss energy futures trades.

• Adding fuel to the fire, ASIC’s investigation into ANZ's bond traders has now expanded to include claims that the bank inflated its trading figures by $54bn—likely giving it a leg up to win lucrative mandates.

Tech

• Even with the debut of Apple’s gen-AI, "Apple Intelligence," investors remain uneasy about AI competition from Google and Microsoft, leading to a 1.5% dip in shares, despite Apple's strong quarterly results. Moreover, investor legend Warren Buffett’s Berkshire Hathaway continues to sell down its holding in the tech behemoth, with a ~25% reduction in holding since the start of the year.

🏘️ Word on the Street 

• Forget the stereotypes—British lawyers are trading in their cautious ways for a more US-style "rainmaker" approach, where running in a client's inner circle is key. Meanwhile, the influx of high-paying US firms in London has driven up UK law firms' charge-out rates by nearly 40% in five years.

• Global law firm Ashurst adds nabs new Chief Information Officer to its London office from rival firm Norton Rose Fulbright. Kevin Harris joins the new role will an extensive background in technology, strategy cyber security and technology innovation.