Greetings, and welcome to the first Elevate Legal newsletter.
It’s hard to believe we’re two years old this month . Over that time we’ve been honoured to work with more than 40 clients, from the earliest of start ups through to listed companies; as well as providing pro-bono support to two local charities having a global impacts.
We hope you enjoy this short newsletter. If there are things you’d like us to cover in future editions please let us know at firstname.lastname@example.org.
What’s keeping us busy
Here’s a selection of things we’re helping our clients with. If you’re looking for similar solutions please let us know.
- Helping researchers spin out their intellectual property (IP) into separate companies: setting up the company, getting a shareholders agreement in place, getting the right IP into the new company ready for commercialisation.
- Guide several clients through the requirements of the European Union data privacy laws – GDPR – which came into effect in May 2018. Also helping some clients navigate through the local Australian law on mandatory reporting of data breaches.
- Early preparation for an IPO (ASX listing) or other exit event. Helping the board and management team get a company ‘IPO Ready’ in a measured way over 6 months – rather than trying to do it in the last month before listing – saves a whole lot of money (and anguish).
- Capital raisings – both public (Offer Information Statement, Prospectus) and private (Information Memorandum, subscription agreements).
- Advice on corporate governance matters: Board and Management disputes; drafting, amending and implementing shareholders agreements; managing a sell-down by some shareholders to other existing shareholders; getting Board committees set up; putting in place an Advisory Board.
- Employee equity plans – getting the rules in place and making offers.
Managing our clients’ share registers – including staff equity – online at www.registrydirect.com.au – a subscription based service which replaces manual spreadsheets and paper share certificates.
- Drafting and reviewing lots of commercial contracts: NDAs, MoUs, product and service contracts, software licences, software-as-a-service (SaaS) terms, reseller and distribution agreements, collaboration agreements…
Each newsletter we’ll profile one of our clients doing amazing things.
First up is Pollinate Energy Limited, an Australian based charity having a global impact.
In May this year Pollinate completed a merger with U.S.-based social enterprise Empower Generation.
The merged group brings life-changing products to people living in city slums and remote villages facing economic and energy poverty. Their long-lasting solutions include products such as solar lights, clean cookstoves, medicated mosquito nets and more – all aimed at improving the health, safety, quality of life, and immediate environment of families in poverty. Pollinate distributes these products through a diverse network of ‘Pollinators’ – door-to-door sales agents, women-owned shops and franchises. They empower Pollinators with the skills, knowledge and confidence necessary to sell and service products on affordable payment plans. Women in the network earn significant incomes and are promoted to positions of leadership while gaining power in their household and community.
To date, Pollinate and Empower have recruited, trained and empowered more than 500 people across India and Nepal, providing them the with business skills and self-confidence to deliver high-quality products to benefit more than 450,000 people. The group aims to train and support over 1,000 women to join the network and positively impact 1 million people by 2020.
Elevate Legal is proud to be supporting Pollinate with pro-bono company secretary and legal support. For more details or to donate please visit https://pollinateenergy.org/.
GDPR – EU privacy laws can impact you
No doubt you’ve already heard a lot about the European Union’s General Data Protection Regulation (GDPR). It’s a significant change to Europe’s data protection laws, which came into effect on 25 May 2018.
You may need to comply if you have an establishment in the EU, if you offer goods and services in the EU, or if you monitor the behaviour of individuals in the EU. If you collect or use personal information from EU subjects (e.g. on your mailing list, CRM system or subscriber list) then you should certainly be aware of the GDPR requirements.
While some concepts of GDPR are similar to the Australian privacy laws, other aspects are different; for example the ‘right to be forgotten’ and the concepts of ‘data controllers’ vs ‘data processors’.
Australian Privacy Laws – mandatory reporting of data breaches
Meanwhile, Australian privacy laws also kicked up a gear, with it becoming mandatory (from February 2018) for organisations to report (some) data breaches. This applies to organisations that are covered by the Privacy Act, which, generally, means: government agencies; contractors that provide services under a Commonwealth contract; businesses with revenue over $3m; businesses trading in personal information or health service providers.
If these organisations suffer a data breach (meaning when personal information is lost or wrongly used or disclosed) and the breach is likely to result in serious harm, then they must notify the individuals at risk, plus the OAIC (Privacy Commissioner) as soon as practicable. There are large penalties for not complying, plus the increasing risk of lawsuits – including class actions – from people affected by the breach.
The OAIC releases quarterly reports on the notified breaches. The number of breaches notified has increased each month (from 55 in March to 90 in June 2018). Malicious or criminal attack was the cause of 59% of the breaches, with human error accounting for 36%.
We recommend putting in place a data security procedure, so you have clear internal guidelines on how to respond to a data breach quickly and appropriately. You don’t want to be making it up on the fly.
The OAIC has lots of helpful guidance notes and templates on its website – here.
Unfair contract terms
From November 2016, the Australian consumer protection laws extend protection against ‘unfair contracts’ to small businesses (less than 20 staff). The laws regulate standard form contracts which have an up-front value of less than $300,000.
The ACCC has now secured two Court decisions against larger companies that imposed unfair standard contracts on small businesses.
Terms which are particularly vulnerable are those that give one party (but not the other) the ability to: avoid or limit their obligations under the contract; terminate the contract or vary the terms (including re-pricing); and one-sided indemnity and liability terms. Clauses which automatically renew the term of the contract can also be questionable (e.g. where the customer forgets to cancel a subscription service in time and it automatically re-sets for another year).
If you ask small businesses to sign your standard form contracts, you should check that the terms are still reasonable and enforceable.
More information on ACCC’s website – click here.
Congratulations to Elevate Legal team member Roxie Adam, who in June became a fully qualified lawyer, after being admitted to practice in a formal ceremony in the Supreme Court of Victoria. This is an important milestone in a lawyer’s early career and a testament to Roxie’s hard work over many years.
Distractions we’re enjoying at the moment:
- The Rise of Theodore Roosevelt and Theodore Rex, by Edmund Morris. Teddy Roosevelt, the youngest ever US President and a larger than life character, leaps off the pages of these outstanding biographies.
- Slow Burn (Season 1) – a podcast about Watergate and the slow motion but inexorable collapse of the Nixon Presidency. Highly recommended listening for those who are shocked by President Trump’s current entanglements.
- A16z Podcast, from the folk at VC firm Andreesen Horowitz. Some episodes can be a bit ‘Silicon Valley bubble and froth’ but this one from 19 July has some useful insights on scaling companies (and technologies) beyond start up.
- Finally – the Tigers ruling at the top of the AFL ladder leading into finals. My goodness it’s 1980 all over again.