AUSTRALIA Law and Practice Contributed by: Joachim Delaney and Ranjani Sundar, HFW
The “officers” who may request the information outlined above include a member or employee of the Australian Police Force, the Integrity Com - missioner, Chief Executive Officer of the Aus - tralian Crime Commission, and staff member of the Australian Crime Commission (Proceeds of Crime Act 2002 (Cth) Section 213(3)). Furthermore, under Section 40 of the Anti-Mon - ey Laundering and Counter-Terrorism Financing Act 2006 (Cth), “reporting entity” must report any suspicious matter to the CEO of the Aus - tralian Transaction Reports and Analysis Cen - tre (AUSTRAC). Section 62 of the Banking Act 1959 (Cth) also requires an Authorised Deposit- Taking Institution (ADI) to provide information to the Australian Prudential Regulatory Authority (APRA) in respect of the ADI or any member of a group of bodies corporate of which the ADI is a member. Additionally, ASIC may require a bank to produce specified books relating to the affairs of the bank under Section 30 of the Aus - tralian Securities and Investments Commission Act 2001 (Cth). Under Section 77A of the Bank - ruptcy Act 1966 (Cth), a trustee in bankruptcy may require a banker to provide to the trustee (or another), specified accounts, deeds or docu - mentation. 7.3 Crypto-Assets Classification as “Property” There has yet to be an Australian court deci - sion that classifies crypto-assets as constitut - ing “property” . Nonetheless, crypto-assets are legally recognised under Australian taxation laws and company laws. For instance, ASIC considers that the legal status of cryptocur - rency is influenced by the structure of the Initial Coin Offering (ICO), and the rights that attach to the tokens. Consequently, tokens of cryptocur - rency may be regarded as “financial product(s)” under the Corporations Act 2001 (Cth), such as
in the form of managed investment schemes, securities and derivatives. The implications of this classification are that the cryptocurrency will be subject to disclosure, registration, licensing and conduct obligations as required under the Corporations Act. For income tax purposes, the Australian Tax Office views Bitcoin and analogous cryptocur - rencies as assets, which can be held or traded. For instance, an isolated transaction involving the sale of cryptocurrency may result in the cryp - tocurrency being treated as a capital gains tax asset. Meanwhile, a state district court has held that a cryptocurrency investment account is suffi - ciently secure to constitute an investment for the purposes of security for legal costs (Hague v Cordiner (No 2) [2020] NSWDC 23). This court considered that the volatility of cryptocurrency could be addressed by requiring the claimant to notify the defendant’s solicitors of any drop below the secured amount. This decision sug - gests that Australian laws are moving towards regarding cryptocurrency as property in the future. Freezing Orders Australian courts have granted freezing orders in respect of cryptocurrency, where there is a real risk that the cryptocurrency may be destroyed, resulting in the diminution of its value. For instance, in Chen v Blockchain Global Ltd; Abel v Blockchain Global Limited (2022) VSC 92, the court referred to freezing orders having been made over all the defendant’s assets, including a digital wallet holding bitcoin. In granting the freezing order, the court considered that there was a serious question to be tried in relation to whether or not the defendant had defrauded the plaintiffs. Additionally, the court considered that
34 CHAMBERS.COM
Powered by FlippingBook