Corrs Global Network


UK & Europe

Corrs works with Europe-based entities and represents the interests of foreign investors in the European region, through frequent travel to the UK and Europe, as well as our global network relationships. In line with the strong historical ties between our two countries, UK firms feature heavily in our global secondment program and include Slaughter and May and Macfarlanes, as well as European firms including Uria Menéndez and Hengeler Mueller.

As challenging trading and investment conditions continue to affect the UK and the Eurozone, our expertise in all areas of cross-border restructuring and disputes is particularly sought after. For example, Corrs is managing the global team advising Ferrier Hodgson as receivers and managers of Allco Group. This includes the sale of the Allco aviation assets with an estimated market value in excess of US$3 billion.

We have been advising a leading Asia-based financial institution in its bid to acquire a multi-AU$ billion loan portfolio from a leading UK institution. And have also been working on a range of UK/European mandates for leading superannuation funds over the past year, including the Private Capital Group, a consortium of Australian superannuation funds and other institutional investors.

The firm’s sector strengths in telecoms, media & technology, financial services and energy & natural resources are also of substantial benefit to clients with European operations. For example, Corrs has been advising ENI, the Italy-based global energy & natural resources giant, on its acquisition of a 32.5 per cent stake in the offshore Evans Shoal gas field. Our highly experienced media team also advises one of the world’s leading media groups in a wide range of major mandates, including significant corporate/M&A transactions between the UK/Europe and Australia.

Contact our team to learn more about the firms we work with across the region and how we can assist.

Our Thinking

Germany - Australia's gateway to Europe

What opportunities are there for Australian companies doing business in Germany?

It will be 25 years this month since the fall of the Berlin Wall. While millions of people are commemorating this momentous occasion, it’s also an excellent opportunity to reflect upon the opportunities Germany offers Australian companies and Australia generally.

Just as the fall of the Wall reunited East and West Berlin, the digital age has broken down the distance barriers between Australia and Europe, making it relatively easy for Australian companies to operate in Germany.

When Australians think of doing business in Europe, many naturally think of the United Kingdom. But Germany should not be ignored. As the fourth-largest economy in the world and Europe’s largest economy, Germany offers enormous scope for Australian companies doing business in Europe.


German immigration to Australia dates back to the mid-19th century, and Germany and Australia’s cultural and trading relationship has flourished ever since. Australian companies that have had operations in Germany for some time include Brambles, Sonic Healthcare and Hochtief, just to name a few.

The two countries marked the 60th anniversary of Australian-German bilateral relations in 2012 by signing a Strategic Partnership to further strengthen ties. Under the Partnership, the two countries have committed to facilitating connections between German business and Australian business, particularly in the areas of climate, renewable energy and resources.

Significantly, Germany’s Chancellor, Angela Merkel, is scheduled to attend the G20 Leader’s Summit in Brisbane on 15-16 November 2014 as a guest of the Australian government. This is the first such visit since 1997.


Germany has the largest economy in Europe

Germany’s GDP is 22% of the entire Eurozone’s GDP. It is one of the world’s largest exporters, with approximately AUD$1.46 trillion worth of exports each year and a current account balance of around US$215 billion. It is Australia’s tenth largest trading partner. Further, around two-thirds of the world’s key international trade fairs are held in Germany.

Shared interest in key industries

Underpinning Germany’s strong economy is a history of investing in priority industries. Many of its key industries are also priorities for Australia, which makes the two countries natural trading and economic partners.

There are already over 300 partnerships and co-operation agreements between Australian and German universities. There is also great potential for co-operation in the supply of Australian raw materials to Germany and German investment in Australia‘s resources and biotechnology sectors.

Germany’s key industries include:

Information and communications technology - Germany's ICT industry is Europe’s largest and it was one of the reasons the German economy weathered the global financial crisis as well as it did.

Renewable energy and environment technology - Germany is a global leader in renewable energy and environmental technology and is home to:

  • The world’s largest photovoltaic market;
  • Europe’s largest solar thermal market; and
  • Europe’s largest wind energy market and one of the largest wind industries worldwide.

Medical technology - Germany is Europe's leading location for medical technology and the second largest medical technology producer and medical services provider worldwide.

Germany is the gateway to Europe

Germany shares borders with every major economy in central Europe and provides access to both established markets in western Europe and emerging markets in central and eastern Europe. Germany's exceptional infrastructure is set up to transport both passengers and goods quickly and efficiently by air, land or sea. 

Further, given the Single European Market of the Eurozone, goods, services, persons and capital can move freely within this market. As a result, imported goods sold in Germany are exempt from customs duties and procedures if the goods originated in a member state of the European Union or the goods were previously imported into another member state of the European Union before moving on to Germany.

With a number of shared priorities and many Australian companies already having successful operations in Germany, there is a great deal of scope to further strengthen existing relationships and build new alliances.  

Germany is about much more than bratwurst and beer: its economic might and open market offer Australian companies excellent opportunities to thrive in the European market.

Haley Aprile is a Senior Associate currently seconded to one of Germany’s leading law firms, Hengeler Mueller as a Foreign Lawyer. More information on Hengeler Mueller is available from its website.

Will reforms in Europe influence telecoms regulation in Australia?

Telecoms operators in Australia should be closely watching the telecommunications reform agenda unfolding in Europe.

On 12 September, the European Commission (EC) released a package of proposed changes to telecommunications regulations. The reforms aim to create a single market for telecommunications across the EU and include reducing roaming charges to consumers, harmonising rules applicable to telecom operators and introducing an EU wide protection of net neutrality. 

Alongside the legislative changes, the EC has also published a Recommendation to harmonise costs that incumbent operators can charge other operators for the access to their copper networks.  The Recommendation is intended to provide certainty to investors with the aim of fostering the development of next generation broadband services.

Many of the changes proposed by the EC are also ‘live issues’ in Australia and the debate over the European reforms will no doubt be closely watched by our own regulators and operators.


1. Harmonise and simplify rules for telecom operators

There are currently 28 separate national telecommunication markets across the EU, each of them with different players and different regulations. 

In order to create a single telecoms market, the EC considers it is essential to harmonise the legal requirements imposed on operators.

The main reform proposed in this regard is the creation of a single authorisation system for the entire EU.  Other measures include introducing a demanding threshold for regulating telecoms sub-markets, which is likely to reduce the number of regulated markets, and further harmonising the regulation for accessing competitive services.

The legislative reform package also reinforces EC powers to ensure uniform application of telecom regulations by National Regulatory Authorities (NRAs).

2. Harmonise consumer protection by eliminating mobile roaming and international call surcharges

The proposal is to reduce certain prices charged to consumers by the telecom operators. In particular:

  • Roaming charges will be banned from 1 July 2014: and
  • Premium operators charges for international calls will be prohibited.

This proposal has sparked controversy as it means eliminating a lucrative revenue stream for telecom operators. Some commentators have even suggested it will affect operators’ abilities to invest in new infrastructure.

3. Improve coordination of wireless-frequency auctions

The EC considers that differences in timing, conditions and cost of acquiring radio frequency spectrum make it hard to develop integrated wireless networks between countries.
The reforms aim to deliver more timely and predictable spectrum availability for operators active in the EU.  
Spectrum is also a hot issue in Australia given ongoing concerns about availability and pricing. 

4. Safeguard net neutrality and set common criteria for wholesale broadband access rules

The EC proposes to explicitly recognise the right of users to full access to the open internet regardless of the cost or speed of their internet subscription. This measure, which favours consumers and portal operators such as Google but arguably harms carriers, has also been controversial.

The EC has justified the measure on the basis that several of its jurisdictions were already considering passing laws on this issue.

However, net neutrality is likely to be intensely debated in the EU Parliament as several lawmakers have expressed opposing positions.

5. Increase certainty for investors

As a complement to the legislative changes, the EC also published a Recommendation to harmonise costs that incumbent operators can charge other operators for the access to their copper networks.

It is intended to provide long-term stability for copper access prices, ensure equal access and set the conditions under which price regulation is no longer warranted.  The ACCC are considering very similar issues as part of its Fixed Services Review.

As a general rule, recommendations adopted by the EC are not formally binding.  Nevertheless, as the proposed regulation foresees to confer the EC veto powers over the decisions of the NRAs, in practice, the Recommendation would be binding.


If adopted, the telecommunications legislative package will be a significant step towards achieving an integrated telecoms market within the EU.  It may also encourage consolidation to create EU-wide operators that would be better placed to compete globally. 

Some of the issues addressed in the reforms, namely the elimination of roaming charges, the spectrum and access to copper networks pricing along with the explicit recognition of the net neutrality are topics currently being discussed in other jurisdictions including Australia. 

Both the ACCC and the ACMA have in the past referred to the EU legislative developments in their assessments. For this reason, the position finally adopted by the EU in these matters may influence future decisions of the ACCC and the ACMA in the telecoms sector.

Linking the Australian and EU carbon markets - An overview of how, when and what this means for business

A one-way link between Australia’s CPM and the EU's emissions trading scheme has now been legislated. Is this good news for business?

On 26 November 2012, the Government passed legislation that implements an interim link between Australia’s carbon pricing mechanism (CPM) and the European Union Emissions Trading Scheme (EU ETS) and facilitates linkages to other international carbon trading schemes in the future.  In addition, as expected, the $15 price floor for Australian carbon units was removed.

The proposal to link the CPM to the EU ETS was announced on 28 August 2012 by the Australian Government and the European Commission.  Initially the link will only be one-way, allowing European Unit Allowances (EUAs)[i] to be used to meet obligations under the CPM in Australia from the commencement of the flexible price period (1 July 2015). However, the parties are intending to conclude a formal agreement on a full link by mid-2015, which is to commence no later than 1 July 2018.

In this article we provide an overview of how the interim link will work and comment on the opportunities and challenges for business.  If you are not familiar with the CPM, you may like to read our general summary first.

Overview of the Link

Implementing the Link

The Link has been implemented by bringing EUAs and Australian Issued International Units (AIIUs) (a new kind of unit) within the definition of “eligible international emissions unit” in the Clean Energy Act 2011 (Cth).  

Although EUAs are now eligible international emissions units, it is not currently possible to transfer EUAs directly into the  Australian National Registry of Emissions Units (the Australian Registry).  In these circumstances, there are two ways to enable the transfer of EUAs to Australia – either the Clean Energy Regulator could issue AIIUs to “shadow” EUAs in the EU ETS Registry (AIIUs can be held in the Australian Registry) or the EU ETS Registry could be prescribed as a “foreign registry” in the Australian National Registry of Emissions Units Regulations 2011.

The Australian Government has issued draft regulations which adopt the first of these options up until the commencement of the full link.  This would mean that a liable entity would be able to transfer EUAs to Australia (as AIIUs) from the beginning of the flexible price period on 1 July 2015 and surrender them to partially satisfy its obligations under the CPM.  These regulations are expected to be introduced by 1 June 2013.

When the full link commences, the Government intends make the necessary regulatory changes to enable EUAs to be directly held in the Australian Registry.  At this time, it is intended that all AIIUs will be automatically cancelled and equivalent EUAs held in the Australian Registry will be provided in their place.

Draft Registry Linking Arrangements

In March 2013, the EU Commission and the Australian Government issued a joint consultation paper on Registry options to facilitate linking of emission trading systems, and the Australian Government issued draft regulations.

Under the proposed arrangements, the holder of the EU ETS Registry account where the relevant EUAs are being held will start the transfer of those EUAs by issuing the appropriate instructions to the EU ETS Registry, including nominating an Australian Registry Account to which the equivalent AIIUs will be issued.  Behind the scenes the transfer will be validated by both registries and the relevant EUAs will then be transferred into the Australian Government Account in the EU ETS Registry.  When this process is complete, the Clean Energy Regulator will issue equivalent AIIUs to the nominated Australian Registry Account.

It will be possible to “swap back”  AIIUs held in Australia for the underlying EUAs in the EU ETS Registry via a similar process operating in reverse.

The cancellation or surrender of AIIUs in Australia will require the Australian Government to arrange for equivalent EUAs to be deleted in the EU ETS Registry.

Limits on the use of international units

A liable entity is only entitled to surrender “eligible international emissions units” to satisfy up to 50% of its obligation under the CPM and this limit will still apply until 30 June 2020.

However, the Government may now introduce (by regulation) sub-limits for classes of eligible international emissions units.  The first sub-limit to be introduced is a 12.5% limit on the number of Kyoto units[ii] that can be surrendered.

The purpose of sub-limits is to protect the price of Australian carbon units (ACUs) from an influx of cheap international units and to ensure that the demand for EUAs in Australia is not undercut by the availability of cheaper units under the Kyoto Protocol.

To give business certainty, the sub-limit on Kyoto units cannot be modified until at least 1 July 2020. The Government must also provide at least two years’ prior notice of the introduction of a new sub-limit.  Less notice (one year) may be given if a sub-limit is required by an international agreement.

In addition, the Government is proposing to restrict the type of Kyoto units that may be surrendered under the CPM, as set out in recently released draft Regulations that restrict the use of Kyoto units arising from the destruction of trifluoromethane, destruction of nitrous oxide from adipic acid plants, nuclear projects and large scale hydroelectric projects that are inconsistent with EU criteria.

Scrapping the $15 price floor

Previously, auctions of ACUs were subject to a $15 reserve and the surrender of international units in Australia was subject to a surcharge to bring their effective cost up to the reserve.

Although both of these provisions have now been repealed, the Minister still has the power to set a reserve price for each auction of ACUs and to decide how the reserve price will be determined.  A determination of the reserve price will be a legislative instrument and can be disallowed by Parliament.

The explanatory memorandum accompanying the recent legislative amendments indicates that the purpose of this power is to enhance price discovery and to ensure that the auction price of ACUs does not significantly diverge from the secondary market price.  It may also be used to set a starting price in auctions of ACUs to increase their speed and efficiency.

Changes to the calculation of the equivalent carbon price

The availability of cheaper international units and removal of the price floor means that the effective compliance cost for businesses under the CPM may be less than the average auction price of ACUs.

To ensure that the equivalent carbon price on liquid fuels and synthetic greenhouse gases reflects a lower effective compliance cost, the legislative amendments provide for a “per–tonne carbon price equivalent”  to be calculated which takes into account the availability of cheaper international units. This is used in determining the equivalent carbon price imposed on liquid fuels and synthetic greenhouse gases.

Implications for business

The introduction of the link provides new lower cost compliance opportunities for liable entities, which is undoubtedly good news for business.  These new compliance opportunities and the likely impact on the price of ACUs are the key implications of the link for business.

Other significant benefits of the link for business are the possibility that those receiving support under the Jobs and Competitiveness program will receive a higher effective rate of assistance and the potential to use the “per-tonne carbon price equivalent” in commercial agreements.

On the other hand, the key potential downside of the link is the impact of price uncertainty on investment in domestic abatement projects.

We explore these implications in more detail below.

New lower cost compliance opportunities

As both the EU ETS and the CPM allow banking of units, it is possible to purchase EUAs in Europe now with the intention of using them to meet obligations under the CPM in the future.  With the prices of EUAs currently at record lows, this is potentially a significant opportunity for business particularly if its commercial preference is to manage carbon price exposure a number of years ahead of liability under the CPM actually accruing. 

Further, the EU ETS is a more established market with a well developed long-term pricing structure (including a futures market) which could help businesses manage long-term price risk and, if the CPM is repealed in the future, EUAs purchased now could be on-sold in the EU if they cannot be used in Australia.

However, this strategy is not without risk.  Some of the matters to consider when deciding whether to purchase EUAs now are:

  • the future price of EUAs (which is likely to remain volatile due to continued uncertainty regarding whether and when the European Commission’s proposal  to “backload” the auction of surplus EUAs to 2019-20 will be implemented) and future exchange rates;
  • whether to transfer EUAs to Australia as AIIUs as soon as the link is established or wait until just before units must be surrendered. This is a consideration because the transfer and issue of AIIUs is implemented through regulations, which could be disallowed by Parliament following a change of government, potentially stranding AIIUs in Australia. ; 
  • the risk that a sub-limit may be introduced on EUAs or AIIUs; and
  • the likelihood and price impact on ACUs if the CPM is linked to another foreign emissions trading scheme before the flexible price period commences.

Impact on the price of ACUs

Under the previous arrangements, some predicted that the availability of very low cost Kyoto units would cause the price of ACUs in the flexible price period to immediately fall to the $15 price floor.  Although the price floor has been removed, the introduction of the 12.5% sub-limit on Kyoto units will lessen the impact of low cost Kyoto units on the price of ACUs. 

Under the new arrangements, the supply of and demand for units in both Europe and Australia will be the primary factors influencing the price of ACUs. This will be influenced by both economic and political factors, including:

  1. the nature of any medium term measures taken by the European Commission to prop up the price of EUAs (e.g. “backloading” proposals), and if any further measures are taken to permanently reduce the number of EUAs (noting that structural changes would require amendment to the EU ETS Directive, which is currently unlikely to occur due to the opposition of countries, such as Poland, that would be significantly affected by an increase in the price of EUAs);
  2. economic growth rates in both the EU and Australia; and
  3. the emissions reductions required by the carbon pollution caps under both the EU ETS and CPM, which will be heavily influenced by the success or failure of negotiations for the second commitment period of the Kyoto Protocol (note that the Climate Change Authority’s review of emissions caps under the CPM is due in draft in the 4th quarter of 2013 and must be completed before 28 February 2014).

The Department of Climate Change and Energy Efficiency has acknowledged that the larger size of the EU ETS market means that:
... decisions about the parameters of the European emissions trading scheme will have more influence on the overall price than decisions about the parameters of the Australian emissions trading scheme.[iii]

The Department also expects that the carbon price that will apply in Australia will be consistent with the carbon price applying in the EU ETS[iv].  This means that it is important for businesses participating in the CPM to keep abreast of political and economic events in Europe which affect the EU ETS and the price of EUAs.

A higher effective rate of assistance under the Jobs and Competitiveness Program

If the price of ACUs is higher than the price of EUAs and other eligible international units, Emissions Intensive Trade Exposed businesses could receive a higher effective rate of assistance under the Jobs and Competitiveness Program.

This could be achieved by purchasing and surrendering cheaper eligible international units (Kyoto units and EUAs) and then on-selling free ACUs allocated under the Jobs and Competitiveness Program at the market price.

Use of “per-tonne carbon price equivalent” as an estimate of carbon compliance costs in commercial agreements

In commercial supply agreements between a liable entity and its customers, a liable entity may seek to pass through its CPM compliance costs before those costs have actually been incurred.  In these situations, it is likely to be important to the parties that the costs are calculated as accurately as possible.   The variety of different units which can be used to discharge CPM liability, and their differences in price, make these calculations challenging.

An advantage of the new arrangements is that there is now a formula for calculating a “per-tonne carbon price equivalent”  which takes into account the availability of cheaper international units.   The Clean Energy Regulator will use this formula to calculate the “per-tonne carbon price equivalent” every 6 months and this figure could potentially be used as a reference for CPM compliance costs in commercial agreements.

Less certainty for investment in domestic abatement

The $15 price floor on ACUs during the flexible price period provided a clear “bottom-line” return on investment in domestic carbon abatement measures (e.g. under the Carbon Farming Initiative). 

The scrapping of the price floor will mean that the price of ACUs (and hence the return on investment in domestic abatement) will be strongly influenced by the price of EUAs, which is currently lower than $15. This exposes investments in domestic abatement to the uncertainties surrounding the future price of EUAs set out above.  However, the limits on the use of eligible international units and the likelihood that the price of EUAs will rise in the future will mitigate this risk for domestic abatement investors.

What next?

It is likely that there will be further linkages between the CPM and foreign carbon trading schemes in the future.  Potential candidates include New Zealand, where a carbon trading scheme was introduced in 2008; and California, whose scheme is to commence at the beginning of 2013 following the initial auctions of permits this year. 

Other potential candidates include Japan’s regional carbon trading schemes, such as the Tokyo ETS which started in April 2010;  South Korea, where legislation was recently passed to establish a carbon trading scheme starting in January 2015; and China, where pilot schemes are currently being established in a number of provinces and cities (some of which are starting next year) and a nationwide carbon market is to be established by 2015.  

Australia’s decision to link the CPM first with the EU ETS, the longest running, largest and most established emissions trading scheme in the world, was a good move.  The experience will provide valuable lessons that will inform the consideration, negotiation and implementation of links to other trading schemes in the future.

Now that the link with the EU ETS is in place, the most important consequence for business is that Australia’s carbon market will be impacted by events in Europe and changes in the European carbon market.  Successful management of carbon liabilities under the CPM will now require a comprehensive understanding of what is happening in Europe.

  [i] EUAs issued for aviation activities are excluded and will not be able to be used to acquit liability under the CPM.

  [ii] Kyoto Protocol units which can be used in Australia include Certified Emissions Reductions (CERs), Emission Reduction Units (ERUs),  Assigned Amount Units (AAUs), and Removal Units (RUs).

  [iii] Commonwealth Senate Economics Legislation Committee, Report on the Clean Energy Amendment (International Emissions Trading and Other Measures) Bill 2012 [Provisions] and related bills, October 2012, paragraph 3.44.

  [iv] Commonwealth Department of Climate Change and Energy Efficiency, Regulatory Impact Statement on Interim Partial (One-Way) Link Between the Australian Emissions Trading Scheme (ETS) And The European Union Emissions Trading System (EU ETS), 3 September 2012, page 6.

Our Experts


Philip Catania

Partner & United Kingdom Focus Group Co-chair Location Melbourne Profile
Rod website grey MOCK thumb

Rod Dann

Partner & United Kingdom Focus Group Co-chair Location Brisbane Profile
Sandy Mak.jpg

Sandy Mak

Partner Location Sydney Profile
Stephen Stern.jpg

Stephen Stern

Partner & Chair of Europe Focus Group Location Melbourne Profile

Secondments in UK & Europe

Corrs has secondment arrangements in place with leading independent firms in this market.

Recent News

Corrs teams up with Austrade to encourage European technology investment in Australia

The Corrs European Business Group continues to focus on opportunities for European companies to invest in Australia, with seminars in Munich, Germany and Madrid, Spain.

Corrs partners Stephen Stern and Jonathan Farrer highlighted the opportunities for investment in Australia and the importance of protection of technology at a series of events in Germany and Spain recently with Austrade.

Stephen and Jonathan emphasised that while many German companies had been established in Australia for some time, there was still opportunity for technological investment and M&A.

Similarly, Spanish inbound investment in the Australian market was increasing, particularly in the infrastructure sector and there were new opportunities available in Australia for Spanish construction firms and companies in related industries.

German–Australian Business and Technology Forum 2014, Munich

Austrade’s inaugural Technology Forum was recently held in Germany’s technology hub, Munich, for German companies, wishing to bring their technology to Australia or to develop their technology in Australia’s world-class technological environment.

Representing Corrs’ European Business Group, Stephen educated German businesses on the way in which Australia’s IP laws can assist companies in protecting their technology in Australia, and Jonathan gave insight into Australian M&A activity, recent Australia/Germany cross-border M&A transactions and upcoming opportunities.

Australian Ambassador to Germany, Switzerland and Liechtenstein, His Excellency David Ritchie, AO opened the Forum. Mr Ritchie discussed the importance of trade relations between the two countries and stressed that while there were many German companies who had been operating in Australia for some time, there was still a great deal of scope to further develop and strengthen those ties. Jeff Connolly, Chairman and CEO of Siemens Australia & New Zealand gave the keynote address.

Corrs was delighted to partner with The German-Australian Business and Technology Forum as a sponsor.  

Spanish Investment in the Asia-Pacific Region, Madrid

In collaboration with Austrade and the Spanish law firm Uría Menéndez, Corrs discussed the future opportunities for investment in Australia, legal strategies for investments and the protection of technology at a Spanish Investment in the Asia-Pacific Seminar in Madrid.

Joining Partners Stephen Stern and Jonathan Farrer, the other presenters at the seminar were Her Excellency Jane Hardy, Australian Ambassador to Spain; David Campbell, Senior Trade and Investment Commissioner, Western Europe – Austrade; Auriol Seaton, Austrade Investment Manager; and Uría Menéndez partner Guillermo Canalejo.