Misconduct decriminalised: are the civil sanctions in the corporations law effective?

Criminology Research Council grant ; (16/97-8)

The Australian Federal Parliament introduced civil penalties into company law in 1993, with the expectation that there would be more effective enforcement of directors' duties. However, in the six years since civil penalties were introduced, the Australian Securities and Investments Commission (ASIC) has commenced only fourteen civil penalty actions. The research undertaken by the authors reveals that civil penalties are perceived by ASIC as serving only a limited deterrent function. The factors that have caused this include ASIC's resource constraints, including financial and resource constraints; its relationships with other regulatory agencies; its recourse to alternative sanctions; and its concerns about the limited utility of civil penalties and the unclear nature of the civil penalty regime and its regulatory praxis.