Defining an 'artificial price' under s 1041A of the 'Corporations Act: Director of Public Prosecutions (Cth) v JM' (2013) 298 ALR 615
Peter Scott
What the paper says
In Director of Public Prosecutions (Cth) v JM ('JM') the High Court considered the market manipulation provision in s l041A of Corporations Act 2001 (Cth) ('the Act') for the first time. Specifically, the High Court considered the meaning of 'artificial price' and 'creating (or maintaining) an artificial price for trading.' In their decision, the High Court adopted reasoning consistent with the interpretation of the lower courts, flowing from the decision of North v Marra Developments ('North'), that had persevered up until the Victorian Supreme Court of Appeal ('VSCA') adopted a narrow approach in Director of Public Prosecutions (Cth) v JM ('JM (VSCA)'). The High Court held that an 'artificial price' for the purposes of s l041A is a 'price that results from a transaction in which one party has the sole or dominant purpose of setting or maintaining the price at a particular level [and does not reflect] the forces of genuine supply and demand in an open, informed and efficient market., The High Court rejected the narrow construction given to s l041A by the VSCA, which was heavily influenced by the US jurisprudence, exemplified by the decision in Cargill, Inc v Hardin ('Cargill'). Additionally the Court reiterated the independent application of the provisions in Div 2 of Pt 7.10 of the Act, in contrast with the 'watertight compartment' approach posited by the VSCA.
Evidence weight
Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40
| F · citation impact | 0.00 × 0.4 = 0.00 |
| M · momentum | 0.20 × 0.15 = 0.03 |
| V · venue signal | 0.50 × 0.05 = 0.03 |
| R · text relevance † | 0.50 × 0.4 = 0.20 |
† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.