“I have looked in horror at the process [of passing the bill],” Dreyfus said Friday, speaking on a panel run by Shine Lawyers and the Commercial Law Association.

“The pandemic was used by this government not to do literally dozens of national projects…and then bang, we get these literally out of the blue changes in respect of continuous disclosure directed at shareholder class actions and these managed investment scheme changes.”

Dreyfus criticised the decision to require funded class actions be registered as managed investment schemes when the Australian Law Reform Commission had specifically recommended against this.

“Since the introduction of the managed investment scheme rules, no one has said they are fit for purpose,” said Dreyfus.

“The government has shown no sign of fixing it up…it is not the right way to approach this.”

Dreyfus said if Labor wins the upcoming federal election it will dismantle the managed investment scheme arrangement because “it hasn’t worked and wasn’t required in the first place”.

Instead, a Labor government would implement the ALRC’s 2019 proposals, Dreyfus said, criticising the Morrison government for failing to act on those recommendations.

“It has 24 modest and pretty practical suggestions not one of which has been implemented,” said Dreyfus.

Dreyfus said he was “extraordinarily disappointed” in the class action reforms the Morrison government has pushed through since 2020, including regulations targeting litigation funders and weakening the continuous disclosure regime.

He also expressed concerns about the Corporations Amendment (Improving Outcomes for Litigation Funding Participants) Act, introduced into Parliament in October, which would cap law firm and litigation funder returns at 30 per cent and require that group members register for a litigation funding scheme.

Dreyfus said the bill was “not thought-through, not based on any research, not based on any consultation” and against the ALRC’s advice.

“Most people looking at this, including members of the Australian Parliament, scratched their heads and thought ‘what’s going on here?’” Dreyfus said.

Dreyfus criticised the lightning speed progress of the legislation, which included a one-week public consultation period.

“It’s no way to proceed with regulation in a complex area. There ought to have been a regulation impact statement, proper research put in and most of all there ought to have been consultation.”

Dreyfus said the bill, which would limit the court’s discretion “for no coherent reason”, will not become law because it would lapse during the proroguing of the House of Parliament.

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