About 2,000 hectares of investors’ trees are believed to be currently managed by Forestry Tasmania (FT) on behalf of investors pursuant to prospectuses issued by various Tasmania Trees Trusts.
See page 15 of http://www.twff.com.au/documents/research/pftpt1.pdf
Senator Bob Brown asked a Question in the Senate in 2001 about FT’s MISs:
http://parlinfo.aph.gov.au/parlInfo/genpdf/chamber/hansards/2001-08-21/0106/hansard_frag.pdf;fileType%3Dapplication%2Fpdf *
The answer reveals information that is particularly relevant today.
FT as a GBE is not regulated by ASIC.
In fact it doesn’t appear to be regulated by anyone.
This became apparent when the Treasurer Michael Aird recently revealed that he provided a Letter of Comfort to FT’s lender because of loan covenant breaches.
The downside, of trading whilst insolvent, didn’t appear to be of major concern to Mr Aird as that was a statutory requirement of no particular concern to FT which was essentially regulated by the State GBE Acts.
The recent Letter of Comfort from the Treasurer essentially guaranteeing FTs debts has suggested to investors a carte blanche method to recover losses from the State Government.
Despite the over abundance of silviculture talent amongst the FT staff, most investors will be lucky to achieve a return in excess of their outlay many moons ago.
Is the possible class action another liability that will require the deep pockets of the Federal Government?
Is this why the forest contractors haven’t been paid?
Will the class action prevent FT from completing the purchase of the Triabunna Mill?
Has FT enough cash?
Or will it have to use more of the TCFA grants?
There’s nothing class action lawyers like better than pursuing prey with no cash, with the full knowledge that there is a third party in the wings that will pay the bills.
It’s called a lawyer’s picnic.
Elsewhere on Tasmanian Times:
John Lawrence has written extensively on Forestry and its flimsy financial status, HERE
*If it doesn’t work, here’s the transcript:
THE SENATE
QUESTIONS ON NOTICE
Forestry Tasmania Trees Trust
QUESTION
3615
Tuesday, 21 August 2001
BY AUTHORITY OF THE SENATE
Tuesday, 21 August 2001 THE SENATE 26278
CHAMBER
QUESTION
Date Tuesday, 21 August 2001 Source Senate
Page 26278 Proof No
Questioner Brown, Sen Bob Responder Kemp, Sen Rod
Speaker Question No. 3615
Forestry Tasmania Trees Trust
Senator Brown (Tasmania) asked the Minister representing the Treasurer, upon notice, on 14 June 2001:
(1)Is Forestry Tasmania Trees Trust immune from the Commonwealth Corporations Law because the Crown operates it.
(2)(a) Does the Trees Trust 2001 offer forecast real returns after 10 years equivalent to 10.5 per cent to 12.9 per cent per year;
and (b) does the Minister consider this to be justified given that the Australian Securities and Investment Commission (ASIC) forced Australian Plantation Timber to issue a supplementary prospectus clarifying assumptions about timber prices and the sector generally is in financial disarray.
(3) (a) What action will be taken to ensure that potential investors are warned about the risks of investing in Forestry Tasmania Trees Trust 2001; and
(b) What action will be taken to ensure that potential investors are aware the offer is immune from the protection of the Commonwealth Corporations Law.
(4) Could the Government’s endorsement of the 2020 Vision contribute to unrealistic forecasts and expectations for plantation investments.
(5) (a) What action will be taken if and when the forecast returns in the Trees Trust 2001 offer are not realised; and (b) what recourse will investors have given that it is outside the jurisdiction of the ASIC.
Senator Kemp (Victoria—Assistant Treasurer)—The Treasurer has provided the following answer to the
honourable senator’s question:
(1) To date the Tasmanian Government has not moved to remove crown immunity applying to its business entities. Therefore, as a Tasmanian State government entity the fundraising provisions of the Corporations Law do not apply to Forestry Tasmania Trees Trust 2001 and the Trust is not subject to oversight by the Australian Corporations and Securities Commission (ASIC).
(2) (a) Yes.
(b) As indicated in answer to question (1) above, any offer document produced by the Trust is not subject to regulation under the Corporations Law. As the content of the relevant offer document is not subject to regulation by the Commonwealth it would not be appropriate to comment on it.
(3) (a) As the relevant offer document is not subject to regulation under the Corporations Law, the Commonwealth corporate regulator, ASIC has no statutory role in oversighting its content.
(b) The document contained the following information: “ASIC Forestry Tasmania is not a corporation under the Corporations Law and is not subject to Corporations Law. Consequently, the fundraising provisions of part 6D.2 of the Corporations Law do not apply to Forestry Tasmania in respect of this offer document.
This offer document is not a prospectus and is not required to be lodged with the Australian Securities and Investments Commission (ASIC). Similarly, the Trust Deed is not an “Approved Deed” or a “Constitution” under the Corporations Law and is not required to be lodged with, or registered by, ASIC and the Scheme is not a “managed investment scheme” for the purposes of Chapter 5C. Consequently, ASIC is not able to register the Offer Document or Trust Deed for the Forestry Tasmania Tree Trust. ASIC takes no responsibility for the contents of this Offer Document or the Trust Deed. Although the Offer Document is not a prospectus which can be lodged with ASIC, Forestry Tasmania has taken the usual steps in exercising care and due diligence in preparing the Offer Document. We aim to ensure that its contents are accurate and that potential growers have all the information they would reasonably require to make an informed assessment of whether or not to apply to become growers in Tassie Trees 2001.
Prospective growers should note, however, that the Offer Document has not been prepared to comply with Chapter 5C of the Corporations Law and the structure and conduct of this offer will not be managed with reference to the requirements of Chapter 5C.”
(4) No.
(5) (a) As a result of the Tasmanian Government’s decision not to remove crown immunity applying to its business entities, the relevant offer document is not subject to regulation under the Corporations Law. Consequently ASIC has no statutory role, powers or jurisdiction to address any deficiency with respect to its content.
(b) Investors would be need to seek legal advice on remedies available to them under the Civil or Criminal Justice Regimes in the State of Tasmania.
ABC Online:
‘Desperate’ loggers want answer on rescue package
The Federal Government is refusing to reveal when it will deliver its $20 million rescue package for Tasmania’s forest industry.
It has been six weeks since the Forestry Minister, Joe Ludwig, visited the state and promised the money would be distributed within weeks.
Ed Vincent from the Tasmanian Forest Contractors’ Association says it is still unclear when the financial assistance will arrive.
“Contractors were promised by Minister Ludwig that they wouldn’t lose their homes, in the meetings that we had with him in September,” Mr Vincent said.
“But we also know that a number of contractors have their homes at financial risk. So there is a very real sense of frustration.”
Mr Vincent says the plight of logging contractors is getting more dire every day.
“It’s extremely frustrating. Our members are desperate. I was told yesterday that there have been several counsellors intervening in near-suicide situations. It’s extremely desperate stakes.”
He says some contractors are planning a protest outside Parliament House in Canberra.
And,
First published: 2010-11-05 05:47 AM
