We have identified an apparent gap in Post-Hayne Report Reforms.
As part of the Hayne Report Reforms, changes are to be made to the jurisdiction of the Australian Financial Complaints Authority (AFCA) from 1 July 2019 to extend the normal 6-year limitation period to commence litigation by permitting AFCA to deal with matters arising after 1 January 2008.
This extension in the jurisdiction of AFCA is however limited to Credit Facilities not exceeding $5m.
We have raised this matter with the Department of Treasury which is dealing with this area of Post-Hayne Reforms and they have advised that they are considering whether and how they will deal with this gap.
Our view is that, as a matter of common sense, it would be inconsistent to not implement an extension of the normal 6-year limitation period similar to the extensions of time in relation to Credit Facilities under $5m under the AFCA.
Aggrieved businesses and farmers with facilities over $5m are likely to have suffered greater losses. They may well now be in a worse financial position than parties with Credit Facilities under $5m who are able to seek compensation through AFCA. It would appear to be inconsistent and inequitable to not provide a similar extension to these businesses and farmers. Additionally, these parties would need to fund their own actions so that there would be no cost to Government.
We think this matter needs to be raised with politicians by aggrieved farmers and on their behalf by bodies such as the National Farmers Federation (NFF) to ensure this unfair and unjust gap is closed. We have notified the NFF of this issue of concern.