Australia

How to successfully implement legal tech into in-house legal teams


The Legal Tech industry is steadily following in the footsteps of its sibling FinTech, generating worldwide revenue of over 17.3 billion USD in 2019 alone. The pandemic has only further contributed to this trend, acting as a huge catalyst in its growth. In-house legal teams have a lot to gain from experimentation in the field, with many Legal Tech projects focussing on simplifying the core legal processes that in-house teams complete every day. 

However, this also means that in-house teams have much to lose during the implementation process. Their smaller scale relative to their company’s chosen counsel, combined with their more selective focus on the core and everyday legal issues faced by the company, means that the imposition of any new process or tool will significantly impact the team, its workload, and its efficiency. 

No in-house legal team, but still interested in the benefits of legal tech?

That’s where Zegal comes in! With tools such as contract automation, contract lifecycle management, and approval workflows, Zegal brings legal tech tools directly to over 20,000 businesses. 

Ensuring legal tech success within in-house teams

With over three-quarters of in-house legal professionals having experienced at least one failed tech adoption project, it is clear that the in-house legal industry has a lot to learn about how to best craft the user experience of the process. 

So how do you ensure success when integrating legal tech into an in-house legal team?T here are three key areas to consider:

  • Selection
  • Implementation
  • Continued support

Selecting the right legal tech

1 in 4 in-house legal professionals cited employee resistance as a barrier to the future adoption of legal tech. Given that 1 in 3 also cited it as a reason why legal tech projects fail, it is clear to see how a dangerous cycle appears. Once an employee has suffered one failed legal tech implementation, they are more likely to be resistant to trialing another, resulting in a lower chance of success for future projects. 

To help combat this resistance, getting employees of all levels involved in the selection process is critical. The most successful legal tech projects are often those that aid the most mundane of processes because these processes usually take the most time cumulatively and ultimately present little financial return for the company.

Engaging with employees to discover these processes and how they are currently conducted will mean they are more likely to advocate the legal tech. Successful adoption of legal tech tools could boost team morale, further improving productivity and employee retention. 

Implementation

While most tools will aim to be somewhat self-explanatory, and employees will be able to pick them up as they work, it is often the case that tools won’t be used to their full potential unless adequate training is given.

Training also presents a further opportunity for employee engagement, especially where custom-built tools are being implemented. 

Continued support and development

Gone are the days when a company could upgrade to the newest version of Windows before breathing a sigh of relief that they were sorted for the next several years. Technology is now patched, developed, and upgraded far more often, and legal tech is no exception. 

Asking what more the tool could do or how it could do what it is currently doing better will help shape future development goals. 

Now is a great time to turn to legal tech

While there are risks of failed legal tech integration, the potential benefits are far greater. Equally, as the field grows, adoption will become imperative.

Considering the process of how to implement legal tech, before embarking on it, will help to ensure success.

 

How to successfully implement legal tech into in-house legal teams


The Legal Tech industry is steadily following in the footsteps of its sibling FinTech, generating worldwide revenue of over 17.3 billion USD in 2019 alone. The pandemic has only further contributed to this trend, acting as a huge catalyst in its growth. In-house legal teams have a lot to gain from experimentation in the field, with many Legal Tech projects focussing on simplifying the core legal processes that in-house teams complete every day. 

However, this also means that in-house teams have much to lose during the implementation process. Their smaller scale relative to their company’s chosen counsel, combined with their more selective focus on the core and everyday legal issues faced by the company, means that the imposition of any new process or tool will significantly impact the team, its workload, and its efficiency. 

No in-house legal team, but still interested in the benefits of legal tech?

That’s where Zegal comes in! With tools such as contract automation, contract lifecycle management, and approval workflows, Zegal brings legal tech tools directly to over 20,000 businesses. 

Ensuring legal tech success within in-house teams

With over three-quarters of in-house legal professionals having experienced at least one failed tech adoption project, it is clear that the in-house legal industry has a lot to learn about how to best craft the user experience of the process. 

So how do you ensure success when integrating legal tech into an in-house legal team?T here are three key areas to consider:

  • Selection
  • Implementation
  • Continued support

Selecting the right legal tech

1 in 4 in-house legal professionals cited employee resistance as a barrier to the future adoption of legal tech. Given that 1 in 3 also cited it as a reason why legal tech projects fail, it is clear to see how a dangerous cycle appears. Once an employee has suffered one failed legal tech implementation, they are more likely to be resistant to trialing another, resulting in a lower chance of success for future projects. 

To help combat this resistance, getting employees of all levels involved in the selection process is critical. The most successful legal tech projects are often those that aid the most mundane of processes because these processes usually take the most time cumulatively and ultimately present little financial return for the company.

Engaging with employees to discover these processes and how they are currently conducted will mean they are more likely to advocate the legal tech. Successful adoption of legal tech tools could boost team morale, further improving productivity and employee retention. 

Implementation

While most tools will aim to be somewhat self-explanatory, and employees will be able to pick them up as they work, it is often the case that tools won’t be used to their full potential unless adequate training is given.

Training also presents a further opportunity for employee engagement, especially where custom-built tools are being implemented. 

Continued support and development

Gone are the days when a company could upgrade to the newest version of Windows before breathing a sigh of relief that they were sorted for the next several years. Technology is now patched, developed, and upgraded far more often, and legal tech is no exception. 

Asking what more the tool could do or how it could do what it is currently doing better will help shape future development goals. 

Now is a great time to turn to legal tech

While there are risks of failed legal tech integration, the potential benefits are far greater. Equally, as the field grows, adoption will become imperative.

Considering the process of how to implement legal tech, before embarking on it, will help to ensure success.

 

How to successfully implement legal tech into in-house legal teams


The Legal Tech industry is steadily following in the footsteps of its sibling FinTech, generating worldwide revenue of over 17.3 billion USD in 2019 alone. The pandemic has only further contributed to this trend, acting as a huge catalyst in its growth. In-house legal teams have a lot to gain from experimentation in the field, with many Legal Tech projects focussing on simplifying the core legal processes that in-house teams complete every day. 

However, this also means that in-house teams have much to lose during the implementation process. Their smaller scale relative to their company’s chosen counsel, combined with their more selective focus on the core and everyday legal issues faced by the company, means that the imposition of any new process or tool will significantly impact the team, its workload, and its efficiency. 

No in-house legal team, but still interested in the benefits of legal tech?

That’s where Zegal comes in! With tools such as contract automation, contract lifecycle management, and approval workflows, Zegal brings legal tech tools directly to over 20,000 businesses. 

Ensuring legal tech success within in-house teams

With over three-quarters of in-house legal professionals having experienced at least one failed tech adoption project, it is clear that the in-house legal industry has a lot to learn about how to best craft the user experience of the process. 

So how do you ensure success when integrating legal tech into an in-house legal team?T here are three key areas to consider:

  • Selection
  • Implementation
  • Continued support

Selecting the right legal tech

1 in 4 in-house legal professionals cited employee resistance as a barrier to the future adoption of legal tech. Given that 1 in 3 also cited it as a reason why legal tech projects fail, it is clear to see how a dangerous cycle appears. Once an employee has suffered one failed legal tech implementation, they are more likely to be resistant to trialing another, resulting in a lower chance of success for future projects. 

To help combat this resistance, getting employees of all levels involved in the selection process is critical. The most successful legal tech projects are often those that aid the most mundane of processes because these processes usually take the most time cumulatively and ultimately present little financial return for the company.

Engaging with employees to discover these processes and how they are currently conducted will mean they are more likely to advocate the legal tech. Successful adoption of legal tech tools could boost team morale, further improving productivity and employee retention. 

Implementation

While most tools will aim to be somewhat self-explanatory, and employees will be able to pick them up as they work, it is often the case that tools won’t be used to their full potential unless adequate training is given.

Training also presents a further opportunity for employee engagement, especially where custom-built tools are being implemented. 

Continued support and development

Gone are the days when a company could upgrade to the newest version of Windows before breathing a sigh of relief that they were sorted for the next several years. Technology is now patched, developed, and upgraded far more often, and legal tech is no exception. 

Asking what more the tool could do or how it could do what it is currently doing better will help shape future development goals. 

Now is a great time to turn to legal tech

While there are risks of failed legal tech integration, the potential benefits are far greater. Equally, as the field grows, adoption will become imperative.

Considering the process of how to implement legal tech, before embarking on it, will help to ensure success.

 

How to successfully implement legal tech into in-house legal teams


The Legal Tech industry is steadily following in the footsteps of its sibling FinTech, generating worldwide revenue of over 17.3 billion USD in 2019 alone. The pandemic has only further contributed to this trend, acting as a huge catalyst in its growth. In-house legal teams have a lot to gain from experimentation in the field, with many Legal Tech projects focussing on simplifying the core legal processes that in-house teams complete every day. 

However, this also means that in-house teams have much to lose during the implementation process. Their smaller scale relative to their company’s chosen counsel, combined with their more selective focus on the core and everyday legal issues faced by the company, means that the imposition of any new process or tool will significantly impact the team, its workload, and its efficiency. 

No in-house legal team, but still interested in the benefits of legal tech?

That’s where Zegal comes in! With tools such as contract automation, contract lifecycle management, and approval workflows, Zegal brings legal tech tools directly to over 20,000 businesses. 

Ensuring legal tech success within in-house teams

With over three-quarters of in-house legal professionals having experienced at least one failed tech adoption project, it is clear that the in-house legal industry has a lot to learn about how to best craft the user experience of the process. 

So how do you ensure success when integrating legal tech into an in-house legal team?T here are three key areas to consider:

  • Selection
  • Implementation
  • Continued support

Selecting the right legal tech

1 in 4 in-house legal professionals cited employee resistance as a barrier to the future adoption of legal tech. Given that 1 in 3 also cited it as a reason why legal tech projects fail, it is clear to see how a dangerous cycle appears. Once an employee has suffered one failed legal tech implementation, they are more likely to be resistant to trialing another, resulting in a lower chance of success for future projects. 

To help combat this resistance, getting employees of all levels involved in the selection process is critical. The most successful legal tech projects are often those that aid the most mundane of processes because these processes usually take the most time cumulatively and ultimately present little financial return for the company.

Engaging with employees to discover these processes and how they are currently conducted will mean they are more likely to advocate the legal tech. Successful adoption of legal tech tools could boost team morale, further improving productivity and employee retention. 

Implementation

While most tools will aim to be somewhat self-explanatory, and employees will be able to pick them up as they work, it is often the case that tools won’t be used to their full potential unless adequate training is given.

Training also presents a further opportunity for employee engagement, especially where custom-built tools are being implemented. 

Continued support and development

Gone are the days when a company could upgrade to the newest version of Windows before breathing a sigh of relief that they were sorted for the next several years. Technology is now patched, developed, and upgraded far more often, and legal tech is no exception. 

Asking what more the tool could do or how it could do what it is currently doing better will help shape future development goals. 

Now is a great time to turn to legal tech

While there are risks of failed legal tech integration, the potential benefits are far greater. Equally, as the field grows, adoption will become imperative.

Considering the process of how to implement legal tech, before embarking on it, will help to ensure success.

 

How to successfully implement legal tech into in-house legal teams


The Legal Tech industry is steadily following in the footsteps of its sibling FinTech, generating worldwide revenue of over 17.3 billion USD in 2019 alone. The pandemic has only further contributed to this trend, acting as a huge catalyst in its growth. In-house legal teams have a lot to gain from experimentation in the field, with many Legal Tech projects focussing on simplifying the core legal processes that in-house teams complete every day. 

However, this also means that in-house teams have much to lose during the implementation process. Their smaller scale relative to their company’s chosen counsel, combined with their more selective focus on the core and everyday legal issues faced by the company, means that the imposition of any new process or tool will significantly impact the team, its workload, and its efficiency. 

No in-house legal team, but still interested in the benefits of legal tech?

That’s where Zegal comes in! With tools such as contract automation, contract lifecycle management, and approval workflows, Zegal brings legal tech tools directly to over 20,000 businesses. 

Ensuring legal tech success within in-house teams

With over three-quarters of in-house legal professionals having experienced at least one failed tech adoption project, it is clear that the in-house legal industry has a lot to learn about how to best craft the user experience of the process. 

So how do you ensure success when integrating legal tech into an in-house legal team?T here are three key areas to consider:

  • Selection
  • Implementation
  • Continued support

Selecting the right legal tech

1 in 4 in-house legal professionals cited employee resistance as a barrier to the future adoption of legal tech. Given that 1 in 3 also cited it as a reason why legal tech projects fail, it is clear to see how a dangerous cycle appears. Once an employee has suffered one failed legal tech implementation, they are more likely to be resistant to trialing another, resulting in a lower chance of success for future projects. 

To help combat this resistance, getting employees of all levels involved in the selection process is critical. The most successful legal tech projects are often those that aid the most mundane of processes because these processes usually take the most time cumulatively and ultimately present little financial return for the company.

Engaging with employees to discover these processes and how they are currently conducted will mean they are more likely to advocate the legal tech. Successful adoption of legal tech tools could boost team morale, further improving productivity and employee retention. 

Implementation

While most tools will aim to be somewhat self-explanatory, and employees will be able to pick them up as they work, it is often the case that tools won’t be used to their full potential unless adequate training is given.

Training also presents a further opportunity for employee engagement, especially where custom-built tools are being implemented. 

Continued support and development

Gone are the days when a company could upgrade to the newest version of Windows before breathing a sigh of relief that they were sorted for the next several years. Technology is now patched, developed, and upgraded far more often, and legal tech is no exception. 

Asking what more the tool could do or how it could do what it is currently doing better will help shape future development goals. 

Now is a great time to turn to legal tech

While there are risks of failed legal tech integration, the potential benefits are far greater. Equally, as the field grows, adoption will become imperative.

Considering the process of how to implement legal tech, before embarking on it, will help to ensure success.

 

How to successfully implement legal tech into in-house legal teams


The Legal Tech industry is steadily following in the footsteps of its sibling FinTech, generating worldwide revenue of over 17.3 billion USD in 2019 alone. The pandemic has only further contributed to this trend, acting as a huge catalyst in its growth. In-house legal teams have a lot to gain from experimentation in the field, with many Legal Tech projects focussing on simplifying the core legal processes that in-house teams complete every day. 

However, this also means that in-house teams have much to lose during the implementation process. Their smaller scale relative to their company’s chosen counsel, combined with their more selective focus on the core and everyday legal issues faced by the company, means that the imposition of any new process or tool will significantly impact the team, its workload, and its efficiency. 

No in-house legal team, but still interested in the benefits of legal tech?

That’s where Zegal comes in! With tools such as contract automation, contract lifecycle management, and approval workflows, Zegal brings legal tech tools directly to over 20,000 businesses. 

Ensuring legal tech success within in-house teams

With over three-quarters of in-house legal professionals having experienced at least one failed tech adoption project, it is clear that the in-house legal industry has a lot to learn about how to best craft the user experience of the process. 

So how do you ensure success when integrating legal tech into an in-house legal team?T here are three key areas to consider:

  • Selection
  • Implementation
  • Continued support

Selecting the right legal tech

1 in 4 in-house legal professionals cited employee resistance as a barrier to the future adoption of legal tech. Given that 1 in 3 also cited it as a reason why legal tech projects fail, it is clear to see how a dangerous cycle appears. Once an employee has suffered one failed legal tech implementation, they are more likely to be resistant to trialing another, resulting in a lower chance of success for future projects. 

To help combat this resistance, getting employees of all levels involved in the selection process is critical. The most successful legal tech projects are often those that aid the most mundane of processes because these processes usually take the most time cumulatively and ultimately present little financial return for the company.

Engaging with employees to discover these processes and how they are currently conducted will mean they are more likely to advocate the legal tech. Successful adoption of legal tech tools could boost team morale, further improving productivity and employee retention. 

Implementation

While most tools will aim to be somewhat self-explanatory, and employees will be able to pick them up as they work, it is often the case that tools won’t be used to their full potential unless adequate training is given.

Training also presents a further opportunity for employee engagement, especially where custom-built tools are being implemented. 

Continued support and development

Gone are the days when a company could upgrade to the newest version of Windows before breathing a sigh of relief that they were sorted for the next several years. Technology is now patched, developed, and upgraded far more often, and legal tech is no exception. 

Asking what more the tool could do or how it could do what it is currently doing better will help shape future development goals. 

Now is a great time to turn to legal tech

While there are risks of failed legal tech integration, the potential benefits are far greater. Equally, as the field grows, adoption will become imperative.

Considering the process of how to implement legal tech, before embarking on it, will help to ensure success.

 

How does Share Vesting work?


If you’re here, you’re likely wondering how share vesting works. In a nutshell, share vesting is the process by which a company gives its equity to its employees or consultants as a means to keep them with the company for a period of time and incentivize them to reach certain established performance goals.

Share vesting is often used when a senior employee or an important advisor or consultant comes on board.

What exactly does share vesting mean?

Share vesting means the company gives its shares to an individual upfront and the shares are subject to the company’s right to buy them back. These shares are known as “unvested shares”. The buyback right extinguishes over time (or upon fulfillment of certain conditions).

The shares that are released from the buyback right are known as “vested shares”. This mechanism is sometimes known as “reverse vesting”, as opposed to the grant of a share option which is “forward vesting” (check out how a Share Option Plan works by clicking here).

Share vesting enables a senior employee or an important advisor to have equity immediately upon coming on board, but the company still retains control over those shares by way of a right to buy back and, in this way, the company keeps the employee or advisor on board until the end of the vesting period. This is how share vesting works.

share vesting

How Share Vesting works

Step 1: Check your company’s Articles of Association/Constitution

Check if the constitutional document of the company restricts the buyback of its own shares. If it does, you may build in some appropriate mechanisms in your Share Vesting Agreement, or you may consider another form of rewarding your team (for example a Share Option Plan).

Step 2: Create a Share Vesting Agreement

Create and sign the Share Vesting Agreement. After signing, the following will take place:

  1. The employee/consultant pays for the shares on the “Purchase Date” that you set in the agreement;

  2. On the Purchase Date, the company secretary issues share certificates in the name of the employee/consultant and he then becomes a shareholder of the company. The numbers of the share certificates and the number of shares covered by each certificate should match the vesting schedule;

  3. The employee/consultant signs a document known as a “Share Power” and delivers this document to the company secretary;

  4. The company secretary keeps the share certificates in the name of the employee/consultant and the Share Power in escrow; and

  5. When shares are vested (i.e. released from the company’s right to buy back) according to the terms of the Share Vesting Agreement, the share certificate in respect of that part of the shares will be delivered by the company secretary to the employee/consultant.

What is a Share Power?

A Share Power is a document in which the employee/consultant gives his authorization to transfer his shares to the company. It is only used if and when the company exercises the buyback right (which may or may not happen). Some information in the Share Power has to be left blank and can only be filled in by the company when it exercises the buyback right.

share vesting

Step 3: The share recipient pays for the shares and signs the Share Power Agreement

The employee/consultant pays for the shares on the “Purchase Date” that you set in the agreement.

In addition, the employee/consultant signs a document known as a “Share Power” and delivers this document to the company secretary.

Step 4: The company secretary issues and holds on to the share certificates

Also on the Purchase Date, the company secretary issues share certificates in the name of the employee/consultant who then becomes a shareholder of the company. The number of share certificates and the number of shares covered by each certificate should match the vesting schedule.

The company secretary keeps the share certificates in the name of the employee/consultant and the Share Power in escrow.

This is how share vesting works. However, there are a few more options available.

Optional: Exercise of the buyback right

If the employee/consultant leaves the company, any unvested shares will be subject to the company’s right to buyback. (Note that the vested shares are not subject to buyback but may be subject to the call option. See Step 4 below.)

The company may exercise its buyback right for three months from the date the employee/consultant leaves the company. The buyback right is deemed to be automatically exercised by the company upon the expiry of the three-month period. This is unless the company notifies the employee/consultant that it does not intend to exercise the buyback right.

If and when the company exercises the buyback right, the company needs to pay the buyback price for the shares (which is the same price that the employee/consultant paid for the shares in the first place) to the employee/consultant. Following this, the company secretary takes the necessary steps to make the transfer effective.

After the buyback, under Hong Kong and Singapore law, those shares will be regarded as canceled. Make sure the company secretary makes the necessary filing with the Companies Registry/ACRA within the applicable statutory timeframe after the share buyback.

Optional: Exercise of the call option

When creating the Share Vesting Agreement, you may opt for a “call option” to be put in place. This call option enables the company to do one of two things:

  1. Buyback all vested shares at fair value; or

  2. Convert all vested shares to non-voting shares (i.e. the employee/consultant, being the holder of the vested shares, can still receive dividends from the company but has no say in the decision-making of the company).

The company may exercise the call option for six months from the date when the employee/consultant leaves the company.

The fair value of the shares is determined by the auditors of the company or an independent firm of accountants.

Conclusion

Now you know how share vesting works. All you need to do is get yourself a share vesting agreement, some solid employees to vest shares to, and you’re good to go.

This article does not constitute legal advice.

The opinions expressed in the column above represent the author’s own.

Start managing your legal needs with Zegal today

BECOME A ZEGAL REFERRAL PARTNER

ABOUT ZEGAL

Zegal is the end-to-end platform for the legal smaller companies need.

Our story

Zegal was founded in 2014 by lawyer friends Daniel Walker and Jake Fisch. Having been a part of the system that preserves quality legal advice only for those that can afford it, the two were determined to build a model that delivers the ‘corporate law firm’ experience to small businesses.

Today Zegal is the world’s only end-to-end platform for smaller companies to create, negotiate, and sign both the simple, and complex contracts they need to run their business, with expert legal advice, 100% online every step of the way. Since our launch, we have helped more than 20,000 companies close commercial contracts, run leaner HR teams, and enter new markets. You can use Zegal for your company in the UK, Australia, and across Asia. Make your legals simple.

READ MORE: UK Startups: Essential Legal Documents

FURTHER READING: Vest Shares to an Employee or Consultant

DOCUMENT: Share Power

Cutomer Story: Minerra, Analytics Solutions


 

Minerra, Analytics Solutions

1-10 Employees

Managing Consultant, Edgar Kautzner

Discover how Minerra has overhauled their contracts using Zegal to create a streamlined system that takes minutes to execute.  

Minerra Melbourne

Minerra is an analytics solution that uses data to help companies make better decisions. Based out of Australia, Minerra’s analytics provides an organisational capability that combines people, culture and the best technology to enable businesses to succeed.

What Minerra Does

Managing Consultant, Edgar Kautzner of Minerra says, “We do data, training and consulting. Everything we do is to help people use data more effectively —that could be running training courses to improve data literacy or helping people use various types of tools to analyze data, but it could also take the form of consultation. So, data strategy, different types of analytics consulting, and building dashboard data integration.”

A professional and streamlined system for legals

Edgar says, “We have two directors running the business and we’ve started scaling up and employing more people recently, but for a period of time, it was just the two of us. That meant we needed to be really efficient in the way that we go about our agreements. 

Generally, for us, the first step after the initial discussion is to get an NDA in place so we can start discussing their situation in more detail. When we were doing it manually, it was cumbersome and awkward. We started using Zegal and we found two main benefits, one is around the mechanics of it:

It’s really easy to shoot out an NDA to somebody, get it signed, and then you can see when everyone’s countersigned the document. It’s all in one place, which is nice and neat.  We have a decent amount of contracts that go through the system, and we’re no longer storing the emails on our shared drive somewhere. 

And then the other side is around the templates. Because we often have different types of agreements that we need to put together, doing those from scratch is a lot of effort. To have templates to start with makes things a lot easier for us. And it’s really flexible with the ability to use a document for different purposes. 

Sometimes we have a partner with who we’re looking at doing a venture that’s a little bit different to the core business. The fact that there are shareholders agreements and agreements for the initial stages of a startup, all those things are really useful to have so we’re not sorting through the minefield of Google. The fact that it’s all there on Zegal, we find it really useful.

Problem-free operations across different jurisdictions

Another reason Minerra decided on Zegal for their legals, Edgar explains, “One of the considerations, when we chose Zegal, was that we’re operating in different jurisdictions. So it needed to need to apply across different jurisdictions, which is the case with Zegal. And in terms of the legal prose being sound and solid. Also, the ability to make changes to the documents —because we often have scenarios where we need to go in and edit things— and then we can keep reusing existing contracts that we’ve done. There’s also the ability to upload a document that we’ve created and put them into the system.

I like the document builder on Zegal because it allows me to get a contract out so quickly. Recently we’ve had three different contractors that we’ve used and it’s important for us to get them to sign an NDA and I was able to get those done, I would say within five minutes on Zegal. I do not want to be spending half an hour, or an hour, of my time, putting a contract together —it’s just not a good use of my time.”

Compliance made quick and easy

Edgar says, “We’re now compliant with our own processes. An NDA or supplies of supply of services agreement can be in place for every engagement. Before Zegal, we may have had an NDA signed down the track a little bit, and that’s not really good practice. Now we’re quite rigid on the initial call that we do the NDA, and that we have the supply of services agreement all e-signed, as opposed to just doing work without having an official agreement in place, which we used to do quite a bit.

With Zegal, it shows that we’re professional and we use a proper document management system. I think many companies our size might just do things the manual way, but we prefer to work smarter rather than harder. We might be a smaller company, but it gives us the operational efficiencies that I think we get back many times over.

The only reason we didn’t do it, to begin with, was that it was hard work, and now it’s not hard work. It’s much easier to get those agreements in place really quickly. It would take me much longer before. And even the sort of the facilitation of multiple signatures, it’s just easy because it’s all handled on the platform. And a pretty serious benefit of the written agreements is knowing how much we’re going to be paid, and we all know what the scope of work is. That peace of mind is really important.”

Visit Minerra here.

This article does not constitute legal advice.

The opinions expressed in the column above represent the author’s own.

Start managing your legal needs with Zegal today

ZEGAL SEES HUGE CUSTOMER GROWTH IN THE UK


small business

Zegal, the end-to-end legal platform for small businesses, launched in Australasia, sees tremendous growth in the UK. 

LONDON, UK, 20 June, 2021 —Increasing small business demand for online end-to-end legal services in the UK has Zegal rapidly expanding its team and product range. 

Small businesses in the UK, well-versed in using cloud accounting services like Xero with their accountants, are demanding the same and more from their legal advisors.  Enter Zegal.  The Zegal platform, which is used across Australia and Asia by more than 20,000 smaller companies and their legal advisors, has seen tremendous growth in the UK as businesses adapt to work-from-home offices.

Zegal is designed to be end-to-end—enabling companies to do legal work that is more complex. Zegal’s sophisticated software is the core of the experience, providing the technology for businesses to work alone; or together with good old fashioned real-life lawyers, working virtually through the platform, whenever needed.  The result is streamlined and affordable legals.

As a global Software as a Service (SaaS) company, Zegal was built for the cloud and is an example of how technology companies are providing significant opportunities to small businesses the world over by leveraging the benefits of scale and leveling the playing field.  Zegal recently announced a collaboration with British leading virtual law firm 360 Business Law, selected by Zegal to deliver legal advice to its UK clients. Clients using Zegal’s contract management application can now access a free 30-minute consultation with a lawyer at 360 Business Law.

Daniel Walker, Zegal Founder says, ‘The transition we’ve seen from office to remote working has driven a huge demand in the UK market for virtual legal counsel and platform solutions. We are seeing the strongest demand within the mid-market space, which is a very exciting opportunity.’  

For more information and/or interview requests please contact Alicia Walker at alicia.walker@zegal.com 

 

Linkedin | Facebook | www.zegal.com 

ABOUT ZEGAL

Zegal is the end-to-end platform for the legals smaller companies need. 

Our story

Zegal was founded in 2014 by lawyer friends Daniel Walker and Jake Fisch. Having been a part of the system that preserves quality legal advice only for those that can afford it, the two were determined to build a model that delivers the ‘corporate law firm’ experience to small business.

Today Zegal is the world’s only end-to-end platform for smaller companies to create, negotiate, and sign both the simple, and complex contracts they need to run their business, with expert legal advice, 100% online every step of the way. Since our launch, we have helped more than 20,000 companies close commercial contracts, run leaner HR teams, and enter new markets. You can use Zegal for your company in the UK, Australia and across Asia. Make your legals simple.

 

This article does not constitute legal advice.

The opinions expressed in the column above represent the author’s own.

Start managing your legal needs with Zegal today

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READ MORE: UK Startups: Essential Legal Documents

READ MORE: New April 2020 tax rules in UK and how to comply with IR35

Pitfalls of Setting Up Business in Australia


australia ayers rock

There are always pitfalls to any location you may be considering for your business. Australia has some downsides to look at before you decide to set up shop. 

For business owners looking to start their business on the shores of Australia, the country does have many incentives that make it attractive. Australia ranks 3rd in overall business competitiveness within the Asia Pacific region. However, for every ying, there must be a yang.  A commissioned survey by the Australian Chamber of Commerce and Industry (ACCI) concluded that 4 out of 5 businesses are concerned about taxes. It is always good to take note and be prepared for business challenges. Thus, here are some of the main challenges that businesses face in Australia. 

Construction Permits 

Under Australian laws, businesses that require construction services are required to complete 11 different procedures pertaining to construction permits. The procedures also include local authorities’ approval and inspections wherever required. These procedures might seem daunting and tedious at first glance. Essentially, taking a total of 112 days from start to end before the permits required are obtained. However, in comparison to other OECD countries, Australia’s process is rather streamlined and cost-efficient.

For businesses requiring construction permits, it is highly advisable to plan in advance. To start,  allocate the necessary documentation, resources, time, and costs for a smooth application process. 

Utilities Access 

When setting up a physical business address in Australia, not only do you have to apply for construction permits, you are required to apply for utilities usage. 

There are a number of procedures under Australian laws that must be adhered to before utilities are workable. These procedures should be done and processed at the stage of incorporation.

Similarly, business owners need to plan properly to account for the estimated 75 days needed to get the paperwork completed for utilities access. 

Taxation Procedures

Taxation procedures are important for every business, regardless of the country of operation. It is important to make sure all your taxation processes and systems are set up. Necessarily, you should put these in place at the initial stage to facilitate a smooth payment process. 

For first time Australian business owners, your business must be registered with the Australian Taxation Office at the stage of incorporation. Additionally, the superannuation levy is important to take note of. Business owners should familiarise themselves with the process and payment procedure with regards to the superannuation levy. 

The superannuation levy is the money paid by the employer for his employees’ retirement. This levy is imposed on every income above AUD$450 (before taxes) that is payable by the employer to his employees. This levy is applicable to income payments for full-time, part-time and casual employees. The minimum levy payable, also known as super guarantee (SG), is at 9.5% of the employee’s base earnings. To read more about superannuation levy, you can visit the Australian Taxation Office (ATO) here.

waterfall australia
Pitfalls and waterfalls

Importing and Exporting in Australia

Globalisation opens up a plethora of opportunities for businesses to trade, export and import. However, before doing so, Australian businesses are required to have the necessary documentation, approved by the Australian government. Although there is a sizable amount of paperwork to be done, the process takes place for a short period of time. Thus, making it an easy and time-efficient process if the business has already prepared all its necessary documentation. 

For importation documentation, there is no requirement for importers to have in possession an import license to import goods into Australia. However, for certain types of goods, importers might need to obtain permits to clear customs for their imported goods. There is also a list of fees and charges imposed on import entry. Further in-depth information can be found here.

For exportation documentation, the types and nature of goods being exported from Australian businesses determine the type of documentation required. Permission must be sought from the official Australian authorities, the Australian Border Force (ABF). To finish, more information can be found here.

Culture

Australia is known for its international presence, having multiple transnational companies setting up shop in the land. Therefore, with regard to work culture and ethics, it is rather easy to assimilate into Australian culture due to the globalisation the business environment has experienced. 

sydney opera house

Process of Incorporating a Business  

Being a developed country with a capable government, Australia’s business incorporation process is highly efficient and streamlined. A study by the World Bank and International Finance Corporation (IFC) ranked Australia 2nd globally with regard to the ease of setting up a business. For more information on incorporating a business in Australia, you can read on here.

In a nutshell, Australia has a robust and efficient business incorporation system in place. In order to make your business incorporation and operations smoother, having all necessary documentation ready will make application for permits and licenses a breeze. Australia’s government websites also provide a slew of information that answers many questions, increasing transparency of their processes. To sum up, there aren’t many pitfalls to setting up shop in Australia. Generally, The Lucky Country makes it pretty easy if you know what you’re in for. 

This article does not constitute legal advice.

The opinions expressed in the column above represent the author’s own.

Start managing your legal needs with Zegal today

READ MORE: A Guide to Singapore’s Taxation System

FURTHER READING: A Guide to Australia’s Taxation System

E-sign Laws: Australia


Part 13: Signing in to the digital age

E-signatures are used around the globe and Australia is no different. With a resilient economy and fast urbanisation of infrastructure, Australia is an attractive country to conduct business in. It has also been ranked 18th in the 2018 World Economic Forum’s Global Competitiveness Report, proving the competency of Australia’s economic landscape.

Australia’s uninterrupted strong Gross Domestic Product growth in the past two decades indicates the potential for increasing growth, enticing international businesses to enter the Australian market.

E-signatures Australia

With international business activities, there is a demand for convenience which entails electronic signatures as part and parcel of business transactions. Therefore, it is important to keep yourself updated with Australia’s regulations with regards to e-signatures. 

The Electronic Transactions Act was introduced in 1999 and adopts an open legal framework.

Read on to learn more about the legal compliance for electronic signatures in Australia specifically and watch out for more in this series on Southeast Asia, Hong Kong, China, New Zealand, Australia, UK, Cayman Islands, and BVI.

The Rules on e-signatures in Australia

Requirement for signature

(1)  If, under a law of the Commonwealth, the signature of a person is required, that requirement is taken to have been met in relation to an electronic communication if:

(a)  in all cases—a method is used to identify the person and to indicate the person’s intention in respect of the information communicated; and

 (b)  in all cases—the method used was either:

(i)  as reliable as appropriate for the purpose for which the electronic communication was generated or communicated, in the light of all the circumstances, including any relevant agreement; or

(ii)  proven in fact to have fulfilled the functions described in paragraph (a), by itself or together with further evidence; 

Applicability of an Electronic Signature 

(i)  as reliable as appropriate for the purpose for which the electronic communication was generated or communicated, in the light of all the circumstances, including any relevant agreement; or

(ii)  proven in fact to have fulfilled the functions described in paragraph (a), by itself or together with further evidence; and

(c)  if the signature is required to be given to a Commonwealth entity, or to a person acting on behalf of a Commonwealth entity, and the entity requires that the method used as mentioned in paragraph (a) be in accordance with particular information technology requirements—the entity’s requirement has been met; and

(d)  if the signature is required to be given to a person who is neither a Commonwealth entity nor a person acting on behalf of a Commonwealth entity—the person to whom the signature is required to be given consents to that requirement being met by way of the use of the method mentioned in paragraph (a).

With the international landscape, it is of more importance to understand the legal implications that come along with convenience. Here are some examples of when e-signatures are applicable in Australia:

Use Cases for E-sign

Instances where electronic signatures are generally considered appropriate:

  • HR documents, such as new employee onboarding processes including employment contracts, non-disclosure agreements, employee invention agreements, privacy notices, and benefits paperwork 
  • licenses for intellectual property
  • commercial agreements between corporate entities, including non-disclosure agreements, invoices, purchase orders, sales agreements and service agreements
  • consumer agreements
  • residential and commercial lease agreements

Use Cases Requiring Physical Signature

There are some cases where a handwritten signature will be necessary. These include:

  • official Commonwealth documents such as passports
  • statutory declarations requiring a witness (excluded from ETA)
  • powers of attorney in certain States/Territories (Powers of Attorney Act 2014 (Vic) s 33)
  • wills, codicils and other testamentary instruments (excluded from ETA and notarization required by Succession Act 2006 (NSW))
  • bills of exchange
  • the signature, lodgement, service and filing of documents in connection with legal proceedings in certain States/Territories
  • certain documents under legislation relating to health insurance, life insurance and general insurance
  • certain documents, notices, and consents used in connection with the provision of credit related services under the National Consumer Credit Protection Act 2009 (Cth)
  • transfers of intangible property, such as intellectual property

This article does not constitute legal advice.

The opinions expressed in the column above represent the author’s own.

Start managing your legal needs with Zegal today

More from the E-Signature Series:
Part 7: Vietnam
Part 6: Indonesia
Part 5: Macau
Part 4: China
Part 3: Japan
Part 2: Singapore
Part 1: Hong Kong

READ MORE: Is e-signing legally binding? 

EBOOK: E-signatures

A Guide to Australia’s Taxation System


australia taxation system

Australia’s taxation system has been recently revised. Overseen by the Australian Tax Office (ATO), before doing business in Australia, it is important to know the general business and personal tax rates in order to ensure a smooth financial process for you and your business.

Read on to find out the types of taxes and Australia’s taxation system.

For the filing of personal and corporate income taxes, Australia’s system follows the financial year calendar, beginning on 1st July and ending on 30th June the following year. Additionally, corporations can choose to follow the classic calendar year from 1st January to 31st December instead. The taxation rates under the Australian tax systems are applicable for both Australians and foreign residents working in Australia. 

Corporate Tax Rates 

CORPORATE INCOME RANGE

TAX RATE

All Australian Companies*

Federal tax rate of 30%

*Small Business Companies (with an annual turnover below AUD 50 million) 

27.5%

 

Personal Income Tax Rates

PERSONAL INCOME RANGE

TAX RATE

Up to AUD 18,200

0%

AUD 18,200 to AUD 37,000

19%

AUD 37,001 to AUD 90,000

32.5%

AUD 90,001 to AUD 180,000

37%

AUD 180,001 and above

45%

Medicare levy and surcharge

Most people pay a Medicare levy, which is 2% of your taxable income. The levy is charged as part of your yearly income tax assessment. If you’re on a lower income, this may be reduced, or you may not have to pay it at all. If you’re on a high income, you may have also to pay a  surcharge of between 1.0 and 1.5% of your taxable income. This depends on your level of private health insurance and how much you earn.

Taxable income

Your taxable income is the income you need to pay tax on, minus your tax deductions and offsets.

Income that is taxable

Income that you must pay tax on includes money from:

  • employment
  • pensions and annuities
  • most government payments
  • investments
  • capital gains
  • income from trusts, partnerships or businesses
  • foreign income

Non-taxable Income 

You do not have to pay tax on:

  • lottery winnings and other prizes
  • small gifts or birthday presents
  • some government payments
  • child support
  • the tax-free portion of your redundancy payment
  • government super co-contributions

Tax deductions

Tax deductions reduce your taxable income.

Common tax deductions include:

  • work-related expenses
  • self-education expenses
  • charitable donations
  • accountant fees

Tax offsets

Also known as rebates, tax offsets directly reduce the amount of tax payable. They are applied after the tax has been calculated.

Common tax offsets include offsets for:

  • low-income and middle-income earners
  • taxpayers with a invalid relative
  • pensioners and senior Australians
  • the taxable portion of a superannuation income stream

Salary packaging

Salary packaging is when you ‘package’ your income into salary and benefits. For example, you may arrange to receive less salary in exchange for superannuation or car payments.

If you package  your salary, you can reduce your taxable income.

This article does not constitute legal advice.

The opinions expressed in the column above represent the author’s own.

Start managing your legal needs with Zegal today

READ MORE: A Guide to Singapore’s Taxation System

FURTHER READING: E-sign laws Singapore

Australian Corporations Act: What are Replaceable Rules?


Photo by Holger Link on Unsplash

When incorporating a company in Australia, the Australian Corporations Act contains a section that allows companies to choose to adopt replaceable rules for their internal governance structure.

Now, we’ll tell you just what they are:

What are replaceable rules?

Section 141 of the Act consists of the replaceable rules that act as a basic guide to help company owners better manage their company. 

There are a total of 39 replaceable rules in the Act encompassing issues concerning directors, conduct of board meetings, company secretary, and shares and dividends. It is important to note that some rules are specific to either a public or private company.

The main difference between a company constitution and replaceable rules is that with replaceable rules, minority shareholders are able to protect their interests against decisions that negatively impact them. 

In-depth information can be found on the Australian Securities & Investments Commission website here.

When do replaceable rules apply?

Both public and private companies are able to apply replaceable rules. However, such rules cannot be applied to one-person companies where the sole director is also the sole shareholder. 

Replaceable rules can be easily applied for all companies registered after 1st July 1998. However, for companies that registered before that, the replaceable rules are only applicable if:

  • The company had a constitution and it was repealed before 1st July 1998
    *If it was not repealed, the additional replaceable rules can still be applied alongside the old Corporations Law
  • The company does not possess a constitution 

How do replaceable rules work?

The replaceable rules applied to a company’s internal governance structure, serve as a contract between the company and each member/director/company secretary as well as between one company member and another company member. 

A breach of the replaceable rules does not mean a breach of the Corporations Act. But, the shareholders of the company are required to comply with any replaceable rules implemented into the company’s internal governance structure. This is because the Court allows members to seek compensation or compliance to the replaceable rules, otherwise, the Court will seek other means of remedies outside of breach of Corporations Act. 

Benefits of applying replaceable rules

  • Time & Cost Efficient: in the early stages of starting your business, funds and time might not be on your side. Therefore, applying the replaceable rules is an easy and basic framework that helps you establish the basics of a company in the short run. 
  • Easy switch to a Company Constitution: in the event that your business decides to adopt a company constitution, it is a rather easy process and requires only a special resolution to be passed. There must be 28 days of notice for public companies and 21 days of notice for private companies. 

 

Pitfalls of applying replaceable rules

  • Difficult to navigate: unlike the company constitution, replaceable rules are not published and thus, might be difficult for shareholders and members to locate for reference. 
  • Lack of comprehension: replaceable rules are unable to cover as many issues concerning running a company as compared to a company constitution. A company constitution is best suited for the company individually as it is easily customisable to the needs of the company specifically. 
  • In general, a company constitution is able to cover more in-depth and consistent rules and guidelines of the company and allows the company to have increased control over its share capital.

In a nutshell, replaceable rules are good to have in the short run, especially when you are first starting your business in Australia. However, it is good to constantly revise the need for replaceable rules in comparison to a company’s constitution over the long run. 

This article does not constitute legal advice.

The opinions expressed in the column above represent the author’s own.

Start managing your legal needs with Zegal today

READ MORE: Company Incorporation Step by Step: Australia

Company Incorporation Step by Step: Australia


Photo by Dan Freeman on Unsplash

 

This article covers what you need to know in order to get your new business registered  in Australia. Read on for details on Australia’s requirements, procedures, and the estimated timeline to register a company. 

Minimum Setup Requirements to Register a Company in Australia

For a proprietary company:

  • Director (must reside in Australia) – 1
  • Shareholders (crowd-sourced funded, majority must reside in Australia) – 2 

For a public company:

  • Director (majority must reside in Australia) – 3 
  • Company Secretary (must reside in Australia) – 1 

A company director is able to appoint someone else to act as an ‘alternate director’ for a fixed period of time. The ‘alternate director’ may have the full rights or selected rights of a director, he/she can also act as the ‘alternate director’ for more than one director.

Get Started: Company Incorporation Documents

Registration Process 

The Australian Securities and Investment Commission (ASIC) oversees the business incorporation process in compliance with the Australian Government. The Business Registration Service has streamlined and simplified the  incorporation process so it’s a breeze to do online here

*Every registered company in Australia must have an Australian Business Number (ABN) – a unique 11 digit number that is the official and legal identification for your business to the public. (See more below)

The Business Registration Services is a one-stop platform for anybody keen on starting their own business in Australia. The following are the required documents that must be applied and approved in order for the company to be registered.

  • Australian Business Number (ABN)
  • Business Name
  • Tax Registration
  • Licences and Permits
  • Company Governance Structure 

Step 1: Decide on your business structure 

The first step after deciding to start your own business is to decide and declare the type of business structure that is the best fit for your business. The most common types of business structures are:

  • Sole Trader
  • Partnership
  • Joint venture
  • Trust
  • Company

More information on the different types of business structure in Australia can be found here.

Step 2: Establish internal governance structure 

Having a good and strong internal governance structure helps to minimise the risks and streamline the process for making business decisions. However, proprietary companies consisting of only one director and shareholder need not establish an internal governance structure. 

The internal governance structure must encompass the following processes:

  • Procedures for director and member meetings
  • Share structure & transfers 
  • Director appointment and removal 

The business can be governed by either replaceable rules or its own constitution. It can also be a mixture of both.

Replaceable rules are a basic set of rules that can be found in the Corporations Act and is an easier method to govern your business.

A written constitution works hand in hand with a shareholders agreement.

Step 3: Appointment of key officeholders 

Officeholders must be made aware of their legal responsibilities and duties when being appointed officially into their roles. Therefore, it is important to obtain written consent from the parties that have been appointed to office positions. Although the consent is not officially required as a document by ASIC, it is important to have it in the company’s records. 

Step 4: Registering your business with the ASIC

Registering the company will entail submission of a completed ASIC Form 201 Application and the payment of a registration fee (dependent on the type of business structure) of between AUD$408 – AUD$495.

Once the application has been approved, ASIC will issue the ABN and a certificate of registration which must be displayed at all times at the place of business.

The most important identity for a company in Australia is the Australian Business Number (ABN). Having an ABN makes your business identifiable on its own and is used for official and legal purposes as well. Application for an ABN is free for everyone, but not all are entitled to an ABN.

A company requires an ABN if:

  • The company is conducting/ starting a business in Australia 
  • Producing supplies connected with Australia’s indirect tax zone 
  • A Corporations Act company
Reserving a business name 

The business name for the company must follow a fixed set of requirements in order for it to qualify as a company name. You can check if the business name intended has been registered already by searching it on the Australian Securities & Investments Commission (ASIC) website. The cost of registering a business name is AUD$36 (for 1 year) or AUD$85 (for 3 years). The online application process takes roughly 12 minutes to complete, and the approval, if successful, happens within 2-5 working days

*Note: it is optional to reserve and select a business name. Businesses in Australia are officially identified by their Australian Business Number (ABN).

Step 5: Tax registration and compliance

Businesses must also make sure they are fully compliant with the Australian taxation payment system. Therefore, the business must have the required tax registrations like a Tax File Number and the required exemption documents (if needed). 

Registering a foreign company in Australia

According to the Corporations Act, a company is listed as a ‘foreign company’ when it is a company registered outside of Australia. In this case, the company must be registered with ASIC in order to practice business in Australia. 

The steps to register are generally the same as for a local company. However, there are additional documents for registration. 

Documents required:

  • Form 402 Application 
  • Present certified copy of entity’s certificate of incorporation/registration
  • Present certified copy of the entity’s constitution
  • Memorandum of appointment of the local agent or power of attorney (in favour of the local agent) – Form 418 
  • Memorandum stating the powers and rights of certain directors 
Accounting

All transactions relating to the business’s tax and superannuation issues, as well as tax returns and reports, must be kept in the company’s records. For companies with more than AUD$10 million annual turnover, all accounts and returns must be submitted by 15th January after the tax year ends. For companies with less than AUD$10 million annual turnover, all accounts and returns must be submitted by 28th February after the tax year ends.

Annual General Meeting

All companies must convene its annual general meeting within 18 months of initial incorporation and subsequently, within five months of the end of every financial year. 

Corporate Tax

All “small business” companies are required to pay a corporate tax rate of 27.5%, unless their annual turnover does not hit the minimum of AUD$50 million. All other companies are subjected to the full 30% on their taxable income.

Annual filing

All businesses operating in Australia must submit financial reports with ASIC and this is done usually towards the end of the financial year. Annual financial reports must be submitted for auditing as well. 

This article does not constitute legal advice.

The opinions expressed in the column above represent the author’s own.

Start managing your legal needs with Zegal today

MORE IN THIS SERIES: Company Incorporation: Hong Kong, Singapore, Japan, New Zealand, Australia,Taiwan, Macau, China, Philippines, BVI, Vietnam,Thailand, Indonesia, Cayman Islands, United Kingdom

READ MORE: Documents required when incorporating your business

FURTHER READING: Company Incorporation Step by Step: Singapore

 

Defamation Laws in Australia – The Proposed Changes


 

2020 marks a year of significant changes to Australia’s defamation laws. These laws haven’t been reformed for 15 years and haven’t had serious modifications since the invention of the internet. 

What is defamation?

The Defamation Act of 2005 got rid of the distinction between libel and slander. Now both are referred to as defamation.

Defamation law applies to communication in all forms. This includes a conversation held in person, email communication, online publication, a Facebook status update, as well as newspaper and magazine publication, among others.

Defamation laws seek to find a fair balance between reputation and freedom of speech. 

Current Libel Laws 

Australia has been dubbed the “defamation capital of the world”. With well under half the population of the UK, New South Wales has double the number of libel cases.

In the past year, there have also been a large number of high profile defamation suits with enormous payouts. One by the actor Rebel Wilson, which saw her win a record payout of $4.7 million from Woman’s Day. Another saw actor Geoffrey Rush win $2.9 million from The Daily Telegraph. 

 

The Problem

With no legislation specifically for defamation on the internet, the laws aren’t keeping up with the advancements in technology.  Currently, every time something considered defamatory is downloaded off the internet it can be brought before the court multiple times. The last changes to Australian defamation laws were made in 2005 when things like Facebook were still in their infancy. 

Many current cases are now based on defamatory social media posts. Many of the cases in court are now between individuals, instead of media outlets.

Also, experts have suggested Australia’s current laws have muzzled reporting on allegations of sexual misconduct as part of the #MeToo movement.
 

Currently the principal award in a defamation suit is for damages, which is problematic in itself.  Many people who have been defamed would consider the costs and embarrassment of suing as undesirable. Alternative remedies should be proposed like retractions an declarations of falsity as well as take-down orders rather than only monetary remedies.

The principal problem is how to ensure free speech is maintained without the devastating effects defamation can unfairly have on reputation. The balance between supporting responsible journalism in a time of fake news and online trolling is not going to be an easy one to address. Ensuring that trivial cases are not the ones consuming the courts time is another enormous issue. 

What could change? 

There are many other countries looking to make appropriate changes for the age of the internet. Canada, Scotland,and Ireland are a few that are examining their respective defamation laws.

The biggest changes should naturally be for online news articles. Currently, any time an article is viewed it is considered a new publication. This means publishers have indefinite liability each time an article is clicked. Introducing a once-only defamation rule for pieces published online makes sense and will enforce a stricter time limit on internet content.

A new public interest defence is built on a model from New Zealand of “responsible communication in the public interest”, which protects certain communications by requiring the wronged party to first prove that the matter is of public interest. It’s a defence similar to qualified privilege. 

A threshold of serious harm is another proposed reform borrowed from UK laws that states that a person can’t sue unless they have actually suffered serious harm. 

Changes to the cap on damages is another proposed change. 

This article does not constitute legal advice.

The opinions expressed in the column above represent the author’s own.

Start managing your legal needs with Zegal today

READ MORE: Australia’s R&D Tax Incentives

FURTHER READING: Labour Hire Licencing Act Australia

Australia’s New Whistleblower Laws: What Employers Need To Do


Here’s what employers need to know

As of 1 July 2019, Australia’s new whistleblower laws apply. Following more than 12 months in Parliament, the new Federal whistleblower protection regime was enacted covering the corporate, financial and tax sectors. The new laws aim to expose corporate (and in some cases, personal) misbehaviour.

The Whistleblower Laws introduced:

  • expanded whistleblower protections for all Australian companies;
  • a requirement for larger Australian companies to introduce a Whistleblower Policy; and
  • new significant penalties for breaches of whistleblower protections, ranging up to $10.5million.

Who can make whistleblower disclosures?

The category has now expanded to include employees, officers and suppliers of companies as well as their family members.

Disclosures made anonymously are still protected by the laws.

What classifies as a protected disclosure?

Protected disclosures include where a person has reasonable grounds to suspect that:

  • there has been misconduct or an “improper state of affairs or circumstances” regarding any of the entities covered by the laws or their related bodies corporate;
  • conduct that breaches the Corporations Act 2001 or conduct that breaches the ASIC Act or a range of specified insurance, life insurance and superannuation statutes;
  • conduct that relates to an offence against any law of the Commonwealth which is punishable by imprisonment for 12 months or more; or
  • presents a danger to the public or the financial system.

It’s important to note that disclosures about personal work-related matters are not generally protected by the laws. This includes: 

  • employment matters that impact upon the employee personally;
  • interpersonal conflict with another employee;
  • decisions regarding promotions, demotions, terms and conditions of employment; and
  • in regards to disciplinary action against the discloser.

Who can protected disclosures be made to?

Protected disclosures can be made to:

  • officers of a company;
  • senior managers;
  • auditors of a company;
  • actuaries of a company; and
  • trustee’s of a superannuation entity.

In certain circumstances, if a discloser has taken the prescribed steps yet has reasonable grounds to believe action is not being taken corresponding to the issue, there is also protection towards disclosing to a journalist or member of Parliament.

Penalties 

If the confidentiality of a whistleblower’s identity is breached, fines of up to $1.05m apply to individuals and up to $10.5m apply to companies involved in the breach.

If a whistleblower is threatened or victimised, fines of up to $1.05m apply to individuals and up to $10.5m apply to companies involved in the.

New Requirements

The laws require all public companies to introduce a Whistleblower Policy.

This also applies to companies with:

  • consolidated ‘Group’ revenue in excess of $50m;
  • consolidated gross assets of more than $25m or more; or
  • 100 or more employees at the end of the financial year.
The Whistleblower Policy must be in place by 1 January 2020. A company that fails to comply may face fines of up to $12,600.

Employers Need To:

  • Implement a whistleblower policy. The policy must set out information regarding:
      1. the protection available to whistleblowers;
      2. the person/organisations to whom protected disclosures may be made, and how they can be made;
      3. how the company will support whistleblowers and protect them;
      4. how the company will investigate protected disclosures;
      5. how the company will ensure fair treatment of employees mentioned in protected disclosures, or to whom such disclosures relate;
      6. how the policy is to be made available to officers and employees of the company
  • Train staff. Employers must train senior managers and those to whom protected disclosures may be made know how to identify a whistleblower report, and the steps they must take if they receive one. It is important to adequately cover the importance of protecting the whistleblower’s right to anonymity from the outset. Employers must also train all staff to know how the whistleblower regime works under the Act. They must also provide training detailing the protections provided to eligible whistleblowers.

  • Assess procedures. The new regime requires analysis of any existing whistleblower procedures. Companies should also ensure procedures to protect whistleblowers’ information will be secure and comply with privacy laws. 

 

READ MORE: The Hong Kong Australia Free Trade Pact Outcomes

 

 

How to Start a Business in Australia as a Foreigner


How To Set Up A Business As a Foreigner In Australia

As one of the larger economies in the world with a large middle and upper-middle class citizenship, Australia has always been an attractive market for business expansions. There are also other considerations that help make it even more attractive. These include the strong trade agreements between Latin America and Australia, the vibrancy of its natural resources and mining sectors, and the shaky political and economic climates of countries such as USA, UK, and China.

Aside from the above, a vital consideration for foreign entrepreneurs is Australia’s ease of market entry.

Here’s a brief introduction to how foreign entrepreneurs could set up their businesses Down Under:

READ MORE: Hong Kong Australia Free Trade Pact Outcomes

Deciding On Your Business Structure

Naturally, the first step is deciding how your business is to be set up:

Sole trader: an individual trading in his own name;

Partnership: an association of people or entities conducting a business together (not as a company);

Trust: an entity standing as a fiduciary entity holding property or income for the benefit of its trustees;

Company: a separate legal entity distinct from its owners / shareholders. Companies in Australia must be registered with the Australian Securities and Investments Commission (“ASIC”). Or alternatively, one may also consider registering a business as a foreign company, or acquiring an existing Australian company. 

The business structure adopted will have a bearing on factors such as:

Required licenses and paperwork to be submitted;

Taxation; and

Potential liability and control over business.

Luckily, the business structure adopted is not something that is fixed. As the business develops, investors are free to change the structure anytime they like to suit the business’ needs.

set up a business in Australia

Australian Business Number (“ABN”)

The ABN Is a unique number by which the business would be identified by other businesses or the Australian government. It also enables a business to register a domain name ending with .au or .net.au. The registration is a simple process that may be completed online.

Business Name and Intellectual Property

Businesses should then proceed to decide on the name under which they will be trading. This may also be done online via the ASIC website, on which one may search the business names register to determine the desired name’s availability. Registration of available names can then be done at the Business Registration Service site.

As registration of business names do not necessarily grant the owner complete legal protection. Businesses should also consider protecting their trademarks and domain names. 

DOCUMENT: Trademark Licence Agreement

Licences

Depending on the business’ nature, location and industry, different licences may be required for its lawful operation. The Australian government’s website is very comprehensive, listing every licence and how to obtain them. 

Taxes

The paying of taxes are, of course, a given, and life will be infinitely easier for a business to have a clear system organised right from the business’ inception.

The Australian Taxation Office issues a unique Tax File Number (“TFN”) to all individuals and entities in Australia. This is a mandatory requirement. Sole traders and proprietors operating under their own names may use their own TFNs for taxation purposes. Partnerships, companies and trusts will however have to apply for one.

As in many other countries, there are different taxes to be paid depending on the business. Some examples include:

Goods and Services Tax (“GST”)

GST is payable under different circumstances. The most relevant ones would be where a business operates in the Goods and Services industry and has a turnover of $75,000 or more. Or if you’re a business importing services or digital goods individually worth less than $1,000 and make more than $75,000 annually.

Pay as You Go Withholding Tax (“PAYG”)

A business will have to apply for PAYG withholding tax if it is required to withhold tax from payments to workers, or other entities (i.e. employees, directors, contractors etc.) Businesses must first register for PAYG before the first occasion it is required to withhold tax.

Fringes Benefit Tax (“FBT”)

If the business provides some type of fringe benefits to its employees, such as work cars, payment of expenses like educational fees or health insurance costs, the business will first have to register for FBT.

Grants

Amongst the abundant support provided by the Australian government, one of the benefits of doing business in Oz are the numerous funds and grants. This again depends on the location and nature of the business. For instance, start-ups in Adelaide may be entitled to a $20,000 Small Business Development Fund. New businesses should pay attention to the potentially very useful tools and grants they may be entitled to.

set up a business in Australia

Visas

Foreign entrepreneurs wishing to set up a business in Australia may be entitled to apply for Business Innovation and Investment Visas if they have been nominated by a state or territorial government. Such nominations may be applied for online.

One may also be eligible for a Business Talent Visa if one

wholly or partially own an overseas business, have net business and personal assets of $1.5 million plus, and has an annual business turnover of at least 3 million;

or has obtained at least $1 million in venture capital funding in Australia for a high-value business idea.

Setting up a business is always a risky venture, especially when you’re setting one up in a foreign country. This risk however may be calculated and controlled if enough planning and careful consideration is invested beforehand.

 

This article does not constitute legal advice.

Start managing your legal needs with Zegal today

 

READ MORE: 5 Reasons to Start a Business in Australia

READ MORE: What is Common Seal in Australia?

READ MORE: How To Start A Business In New Zealand

What is a Common Seal?


What is common seal ?

A common seal, also called company seal or corporate seal is physical illustration emboss with company name and Business number of association or business.

Common seal was historically used to seal contracts, deeds and share certificates, to make them valid.

A company in Australia may have Common seal with company’s name and Australia company number (ACN).

Execution of Common seal in Australia

The Act does not prescribe how documents must be executed by companies without a seal. However, Section 127(1) of the Act provides that a company may execute a document without using a common seal if the document is signed by:

  • two directors of the company;
  • a director and secretary of the company; and
  • for a proprietary company that has a sole director who is also the sole company secretary – that director.

Common uses of company seals include

  • Significant contracts (i.e. not the purchase of a roll of stamps)
  • Real (landed) property transfers and land contracts
  • Loan documents, mortgages and guarantees
  • Occasions where its use is required by a third party

Is common seal or company seal mandatory in Australia?

Prior 1988, common seals were mandatory in Australia, Only documents/ deeds with common seal were considered valid. So in a sense it was compulsory then. The Company law Review ACT 1988 abolished common seal.

Regardless, companies today still use common seal as it give more legitimacy to document for people unfamiliar with the Australian way of document execution.

Read: Incorporating company in Australia  

What Federal Registration of legislation says about Company seal ?

Company may have common seal

         (1)  A company may have a common seal. If a company does have a common seal, the company must set out on it:

                 (a)  for a company that has its ACN in its name—the company’s name; or

                 (b)  otherwise—the company’s name and either:

                          (i)  the expression “Australian Company Number” and the company’s ACN; or

                         (ii)  if the last 9 digits of the company’s ABN are the same, and in the same order, as the last 9 digits of its ACN—the expression “Australian Business Number” and the company’s ABN.

Note 1:    A company may make contracts and execute documents without using a seal (see sections 126 and 127).

Note 2:    For abbreviations that can be used on a seal, see section 149.

         (2)  A company may have a duplicate common seal. The duplicate must be a copy of the common seal with the words “duplicate seal”, “share seal” or “certificate seal” added.

         (3)  A person must not use, or authorise the use of, a seal that purports to be the common seal of a company or a duplicate if the seal does not comply with the requirements set out in subsection (1) or (2).

         (4)  An offence based on subsection (3) is an offence of strict liability.

Note:       For strict liability, see section 6.1 of the Criminal Code.

This article does not constitute legal advice.

Related Posts:
Australia Company Incorporation Guide
Australia’s R&D Tax Incentive
Australia’s Corporation Act: Replaceable Rules
New Whistleblower Laws in Australia

Reasons to start a business in Australia


Aside from its breathtaking beauty, Australia has plenty to offer in the world of business and startups for giving reasons to start a business in Australia. Ranked 19th on the 2016 Global Innovation Index, the land down under is home to one the most flexible economies in the world. The business environment is well regulated and transparency is high. The political landscape is stable and a strong framework of regulations gives investors ample confidence to put their money into promising ventures.

liveability index

Source: The Economist

The cities of Melbourne, Adelaide and Perth were ranked among the world’s top 10 most liveable cities in 2016. All in all, Australia is recognised as one of the easiest places in the world to start a business.  Australian government also have different kinds of  grants for businesses.

If you are thinking about becoming your own boss, here are some reasons to start a business in Australia.

1. You’ll be part of a growing startup ecosystem thanks to strong government support

The growing startup culture in Australia has meant greater support from various stakeholders such as the Australian government and fellow entrepreneurs. The Australian government has invested heavily in Research and Development. The research & development (R&D) tax incentive helps businesses stay one step ahead through a tax offset that promotes innovation in even the smallest companies. One of the big products that originated from Australia is the anti-hacking software kernel seL4 which regulates access to a computer’s hardware and is able to distinguish between trusted and untrusted software, thereby protecting secure data from hackers.

In addition, the Entrepreneurs’ Programme was introduced to increase the productivity and competitiveness of businesses by providing funding and access to a national network of private sector advisors and enablers. The Entrepreneurs’ Programme offers funding support for incubators that help startups enter global markets.

2. You will have access to the resources to succeed given the availability of funding

Access to funds is a key factor that drives innovation as it allows entrepreneurs to develop and commercialise their ideas. The tax incentives for eligible investors that came into place on 1 July 2016 to encourage support for innovative, high-growth potential startups include the following:

  • A 20 per cent non-refundable carry-forward tax offset on investment, capped at $200,000 per investor, per year.
  •  A 10 year capital gains tax exemption for qualifying investments held for at least twelve months.

Venture Capital Limited Partnerships (VCLP) were introduced to draw in foreign investors to Australia with the purpose of boosting the local VC market with multiple tax benefits. The investments must be toward businesses that have total assets valued under $250 million, with 50% of assets and employees located in Australia.

In particular, there has been growing investment in the fintech sub-sector, with the industry expected to be worth $4.2 billion by 2020 based on its current trajectory. In 2016, Australia was ranked the sixth most attractive place for investors in venture capital and private equity in the Venture Capital & Private Equity Country Attractiveness Index.

3. Australia’s strong trade relations with other countries sets the stage for expanding your business abroad

trading partners

Source: Austrade

With strong trading ties with major economies across Asia, Europe and North America, Australia is a good base for expanding the reach of your business abroad. In 2015-16, two-way trade in goods and services totalled A$661 billion, making up 40% of Australia’s nominal GDP. Australia maintains strong trade relations with Asia-Pacific Economic Cooperation (APEC) countries, while the ASEAN region is a significant market. If you are eager to grow their business, Australia’s strong trade relations will stand you in good stead as you get access to cheaper resources and overseas markets.

Learn: Minimum wages in Australia 

4. Australia’s strong talent pool allows you to build a solid team

Australia boasts of a high literacy rate at 99 percent as it has a thorough educational and training system. You will have a ready supply of tertiary-educated workers given that more than 40% of Australian workers hold a tertiary qualification.

workforce literacy

Source: Austrade

If you’re looking for technical talent for your startup, you’re in luck. According to a report by startup rating platform Oddup, 20,000 new technical professionals have relocated to Melbourne over the last five years. The overall workforce are skilled and educated possessing diverse language skills. A cultural melting pot with people from all over, Australia is also the place for you to build a diverse team with members each bringing different perspectives and experiences that will help make your business more robust.

5. Innovation is rewarded with strong intellectual property (IP) laws

Australia has a strong record of innovation, with its R&D spending placing it among the world’s leading innovative countries such as the USA, Japan, Sweden and South Korea. Accordingly, there are strong IP laws in place to protect your trademarks, patents, copyrights, designs and so on. This is crucial as intellectual property is a core asset of a business.

Ranked 12th on the International Property Rights Index in 2016, Australia administers IP legislation via IP Australia. Access the eServices site to apply, register, renew and pay for IP rights. Make the most of the Australian jurisdiction’s strong IP legislation to give your business a competitive advantage over the rest.

Are you an entrepreneur in Australia with more reasons to start a business in Australia and why your mates should join you in starting up down under?

Let us know in the comments below!

Your favourite online legal software – now available in Australia


From Zero to One to Five

The idea for Zegal started in 2012 as two ambitious lawyers who dreamt about revolutionising the way businesses perceived and managed legal.

Daniel Walker and Jake Fisch, Co-Founders of Zegal (2012). Read the story

We’re stoked to announce today that Zegal, the business that was born out of Daniel’s living room, has launched into our fifth country, Australia, with a suite of 44 documents designed for startups to use.

Claim your free trial. Start drafting legal documents with Zegal today.

 

Your favourite online legal software – now available in Australia
Zegal now available for 4 countries: Hong Kong, SingaporeNew Zealand, and Australia

 

The launch of our Startup Plan in Australia promises Australian startups a suite of 44 documents they will need through the phases of Pre-Startup, Startup, Growth, and Maturity. Subscribers pay a one fixed price upfront for a personalised on-boarding session, and a monthly subscription to get unlimited access to the document library to create, store, and organise their documents.

 

Sign-up Today

To celebrate our launch, we will waive the on-boarding fee (worth AUD 1,100) for all users who sign up for a Startup Plan in Australia or New Zealand for the month of February.


Register an Australia Account     Register a New Zealand Account

 

 

By signing up for a free trial, you also get to upload and e-sign your documents for free. No more bulky attachments and unnecessary printing and scanning!

GIF - Upload & Sign
Upload and sign your own documents with a FREE Zegal account. Sign up now – no minimum commitment, no credit card required.

 

The availability of multiple user accounts also lets you share documents and set permissions and workflow. This means your team managers can be empowered to create documents or access legal help whenever they need – cutting out unnecessary back-and-forth administrative processes.

Zegal Startup Plan
Zegal’s for Startups. View 44 documents for Australia

 

What sets Zegal apart is most notably the availability of expertise and support from our Client Service team. While the idea of legal self-service sounds appealing; we understand if you still have questions! Help is just a click away within your Zegal app.

What’s next for Zegal in Australia and New Zealand?

Keep an eye out for increased Dragon activity in ANZ – we’ll have Dragons on the ground who will play a huge role in developing the startup ecosystems in Australia and New Zealand, especially with our signature Legal Academy series of events.

Ready to try everyone’s favourite online legal service?

Start Zegal free trial

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